European Leaders: Here Are Three Predictions To Help You Navigate 2025
Forrester
Europeans feel decidedly grouchy about the region’s economic prospects. And there’s plenty to worry about, including an intense conflict in Ukraine and an escalating war in the Middle East, European labor productivity lagging behind that of the US and China, a deteriorating economic outlook for Germany, and uncertainty about the effects of 2024’s many consequential elections. But despite all that, the economic outlook for Europe in 2025 remains mildly positive; inflation should drop to 2.2%, GDP will grow by 1.5%, and unemployment should remain close to its 20-year low, with a forecast of 6.0%. EU regulators will be busier than ever in 2025; they’ll begin to enforce the relevant portions of the EU AI Act, Corporate Sustainability Reporting Directive (CSRD), and Digital Operational Resilience Act (DORA). To help European business, technology, and marketing leaders navigate this complex environment, here are some of Forrester’s most important predictions for the year ahead:
Satellite interference by a hostile power will cause major disruption.
In 2024, France, Luxembourg, the Netherlands, Sweden, and Ukraine complained to the International Telecommunication Union about interference in satellite networks. Satellite technology is ubiquitous; disruptions interfere with flights, traffic navigation systems, financial systems, TV networks, internet-of-things devices, autonomous systems, and more. The EU recently established a new center for space security, and NATO is also prioritizing the issue. Assess your risk to understand your dependencies — and your suppliers’ dependencies — as well as the potential business continuity.
European firms will piggyback on EU funds to invest €100 million in sovereign cloud.
In December 2023, the European Commission approved the first Important Project of Common European Interest (IPCEI) to create a European value chain for cloud infrastructure and services (CIS). In total, the IPCEI Next Generation Cloud Infrastructure and Services project (IPCEI-CIS) will provide €1.2 billion in public funding, with the EU expecting to unlock an additional €1.4 billion in private sector investments by 2031. Suppliers will seize this opportunity to develop new modular, sustainable, and secure-by-design services and deploy them in places closer to EU consumers. In 2025, service providers will add at least €100 million of their own net-new private investments to the IPCEI-CIS state aid that they receive. Today’s sovereign cloud customers should jump right in. Your organization should look at new opportunities coming from IPCEI-CIS to complement the capabilities of your existing hyperscalers or to meet unsatisfied demands for digital sovereignty or cloud sustainability.
A genAI provider will draw the first EU AI Act fine.
In February 2025, private parties (but not regulators) may begin enforcing the provisions of the EU AI Act against prohibited use cases. In August 2025, regulators, including the European AI Office and the data protection authorities in EU member states, will be permitted to begin enforcement actions against violators of the general-purpose AI (GPAI) model requirements. And we don’t think that regulators will wait long; indeed, Forrester predicts that a GPAI model provider will receive the first fine for violation of the EU AI Act between August and December 2025. While the Act aims GPAI requirements — such as the obligation to disclose training sources and to share results of model evaluations, including adversarial testing — directly at generative AI providers, it links compliance obligations across AI actors, including all the software providers that rely on those models. As a result, your company needs a process for vetting genAI model providers to ensure that they collect the necessary evidence to avoid exposing themselves (and potentially your company) to investigations and fines.
Download the complimentary Predictions guide, which covers more of the top predictions for 2025. Get additional complimentary resources, including webinars, on the Predictions 2025 hub.
This post was written by VP, Group Director Laura Koetzle and it originally appeared here.
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Publish date : 2024-10-25 05:00:00
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