Every data centre is a U.S. military base: The hidden costs of digital dependence

The moment Karim Khan lost access to his Microsoft email address, the International Criminal Court chief prosecutor wasn't just facing a personal inconvenience. He was experiencing a preview of a new form of geopolitical power—one where control over data and digital infrastructure could be wielded as effectively as military force.

When U.S. President Donald Trump sanctioned Khan in February for pursuing charges against Israeli Prime Minister Benjamin Netanyahu over the Gaza conflict, the move had immediate practical consequences. Beyond the frozen bank accounts, Khan found himself cut off from Microsoft's services. The ICC prosecutor was forced to switch to Swiss privacy-focused provider Proton Mail, a move that highlighted both the vulnerability of relying on U.S. tech infrastructure and the existence of alternatives.

The European Wake-Up Call

While this development barely registered in Canadian media, it sent shockwaves through European corridors of power when it became public in May. The revelation that a U.S. company could effectively shut off access to a major international institution's communications infrastructure exposed a critical vulnerability that had previously been theoretical.

Microsoft's response only deepened concerns. The company's spokesperson acknowledged there had been a "disconnection of [the court's] sanctioned official," but the more damning admission came from Microsoft France's director of public and legal affairs. Under oath before the French Senate in June, he stated that Microsoft "cannot guarantee" it would be able to deny requests from the Trump administration for data stored on servers within the European Union.

This testimony crystallized what European lawmakers had begun to suspect: their digital infrastructure was not sovereign territory. Every cloud server, every email system, every collaboration platform run by U.S. companies represented a potential point of control for a foreign government—one that could be activated with a single executive order.

The timing was particularly sensitive. Just a week after Khan's sanctioning, U.S. Vice President JD Vance arrived in Europe to lecture the continent about its values, approach to free speech, and attempts to exclude the neo-Nazi party Alternative for Germany from political power. The juxtaposition was stark: while U.S. officials demanded European governments respect certain political norms, the same U.S. government could simultaneously cut off access to essential digital services.

Canada's Parallel Vulnerability

If Europe's dependence on U.S. tech created vulnerabilities, Canada's situation is arguably more precarious. Geographic proximity and deeper economic integration mean Canadian institutions are even more exposed to U.S. pressure. The difference is that while European leaders have begun speaking openly about these concerns, Canadian policymakers have been more circumspect—until recently.

The pressure on Canada to roll back tech regulations has been persistent but often subtle. While European executives like Meta's Mark Zuckerberg or Apple's Tim Cook frequently complain publicly about European regulations, U.S. tech companies have largely avoided direct confrontation with Canadian authorities. Instead, the opposition is often outsourced to domestic tech leaders and commentators who echo narratives beneficial to U.S. tech giants.

Over the past two years, a coordinated campaign by Canadian tech executives—aligned with the right-wing politics adopted by their Silicon Valley counterparts—began openly pushing a political program in their interests. This often included explicit support for Pierre Poilievre and the Conservative Party. However, since Mark Carney replaced Justin Trudeau as Liberal Party leader, these executives have shifted their allegiance to the former Bank of England governor.

Carney's commitment to attracting investment above all else has made him more receptive to tech industry demands. The results have been swift and significant. Since April, planned AI regulations have been put on ice, along with the Online Harms bill that sought to address harmful behavior in online spaces. This occurred despite concrete evidence of how these platforms are used by bad actors to sow division, particularly during the wildfire crisis that spread across Canada last summer.

The Tax That Trump Killed

Another pillar in the Trudeau government's attempt to regulate the tech industry fell in June when Donald Trump walked away from trade negotiations, stating he would only return once Canada repealed its digital services tax. Executives like Zuckerberg had lobbied Trump to try to kill those taxes in countries around the world, recognizing that such taxes could reduce their profits and set precedents for other nations.

Late on the Sunday night before the tax was supposed to come into effect, Carney and Finance Minister François-Philippe Champagne announced it would be sacrificed so talks could continue. The tax was designed to ensure that large multinational tech companies pay their fair share for the value they extract from Canadian markets, but it became collateral damage in the broader trade dispute.

Months later, a comprehensive deal with the United States remains elusive, but the tax is gone. The message was clear: U.S. pressure, whether from the government or its tech companies, can override Canadian regulatory efforts.

Historical Roots of Dependence

This pressure is not new, nor is it uniquely a product of Trump's return to office. The U.S. government has long recognized the strategic value of ensuring other countries depend on products and services made by companies in its jurisdiction. For years, it has used trade negotiations to insert clauses that limit foreign governments' ability to regulate its tech companies.

The Canada-United States-Mexico Agreement (CUSMA) contains measures that constrain the Canadian government's authority to regulate the tech industry. The agreement limits the ability to regulate cross-border data flows, to force companies to reveal their source code, to discriminate between foreign and domestic tech firms, or to expect them to store data on Canadians within Canadian borders.

These provisions reflect a deliberate strategy that began decades ago. In the late 1980s, then-Senator Al Gore recognized that technology and power were inseparable. In a speech to the Senate, he declared that "the nation which most completely assimilates high-performance computing into its economy will very likely emerge as the dominant intellectual, economic, and technological force in the next century."

Gore and President Bill Clinton were intent on ensuring the United States reaped the gains of the emerging internet. What started as a military and academic project had already begun to be commercialized, and in 1995, they completed the handover of the public infrastructure to the private sector. U.S. companies got a head start on building the businesses that would dominate the digital economy, with easier access to capital to rapidly scale domestically and later internationally.

In those years, the model of the internet was established—and the private sector was firmly in charge. There were debates about carving out a "public lane" on the "information superhighway," but those efforts were ultimately defeated. The U.S. government used its influence to push for telecom deregulation and the removal of trade barriers around the world, aiding its companies to move into international markets.

The Digital Colonization Narrative

Tech advocacy groups assisted in their own way by crafting a narrative that the internet was inherently liberatory and that any attempts by governments to restrict the expansion of digital services, platforms, and the companies that run them was an inherent breach of citizens' rights. Over time, U.S. companies rode the wave to global dominance, and as they took over new markets, domestic competitors were acquired or simply failed in the face of pressure.

This pattern has been particularly evident in Canada. Our dependence on U.S. tech has long been a problem, just one that many people in power did not want to touch because of how it would anger the United States. Even proposing basic tech regulations prompted rebukes from the U.S. government and threatened the prospect of investment from those digital colonizers.

But that dependence left Canada without the tools to get a handle on key avenues for communication and commerce. As U.S. tech companies fought to roll back workers' rights in the gig economy and beyond, allowed false information to spread across social media platforms, decimated the funding model for journalism, and had countless other negative social impacts, the Canadian government was limited in its ability to respond.

All the while, as more Canadians—both individuals and companies—became dependent on U.S. digital services, the profits were siphoned back to the United States, fueling a growing economic divide that has prompted economists to start sounding the alarm.

The Sovereignty Gap

The ICC incident has provided a rare opening to discuss these vulnerabilities openly. For decades, Canadian policymakers have avoided confronting digital dependence because it would anger the United States. But Trump's attacks on Canada have finally given the country space to speak openly and honestly about many of the ways the U.S.-Canada relationship has not been working—and the digital dimension of our lopsided economic integration is a massive part of that.

If Canada is to regain greater autonomy over its affairs and build a better society, it must get serious about reclaiming its digital sovereignty. Since Trump's return to office, governments have been ramping up defense spending to ensure they can defend themselves in a world where the United States is no longer a security guarantor and possibly even a security threat. That same seriousness should be given to digital technology.

As European allies have found firsthand, dependence on U.S. companies for cloud services creates a severe vulnerability, where the U.S. government can request whatever data it wants or can even shut off access at a moment's notice.

Steps Toward Sovereignty

During the election campaign, Carney said he would be reassessing public cloud contracts going to Amazon, Microsoft, Google, and Oracle. More recently, when he announced the first batch of nation-building projects, the prime minister called out the need for a sovereign cloud. He is taking steps in the right direction, but the devil will be in the details.

Our ambition cannot stop there. In far too many cases, our governments, universities, schools, and other public institutions—not to mention private businesses—are run on Microsoft or Google services. Now is the perfect time to get governments off Microsoft 365 and schools off Google Classroom by properly resourcing a new public agency or Crown corporation dedicated to building technology in the public interest.

European state, local, and even departments of national governments are already taking the initiative to move in that direction. There are ample open-source tools already out there that could be adapted to those institutional use cases, with a mandate to work in close collaboration with public institutions to ensure their new suite of digital services properly meets their unique needs.

Governments could even think about bringing tech development closer to communities, building on a model not dissimilar to public libraries. We have an opportunity to think bigger and to challenge those fundamental assumptions that were crafted in the 1990s to convince us digital technology had to be left to the private sector.

For three decades, the goal of tech development has not been to improve our lives or to serve the public good, but rather to maximize shareholder value and to increase the power of the companies that control it. It's that nature of digital technology that is at the root of so many of the social harms that the tech oligopoly have saddled us with in recent years.

We need to recognize that was a choice, and we can choose to take a different path.

The Pitfalls Ahead

But we must also be aware of the pitfalls ahead. Some Canadian tech executives that, until recently, were pushing for a Conservative government are embracing a program of digital sovereignty as well, but it is explicitly not one that centers the public good. Instead, they're pushing the government to continue pulling back on regulations, while deploying billions through public procurement, incentives, and subsidies to flood into their businesses.

They want to hold onto the Silicon Valley model and the harms that it's created, but better cash in on it for themselves. They want to join the digital colonizers rather than bring them down.

This distinction is crucial. Digital sovereignty cannot simply mean replacing U.S. tech giants with Canadian ones while maintaining the same extractive, surveillance-based business models. True sovereignty requires rethinking the fundamental purpose of digital technology—moving from a model that prioritizes profit and control to one that serves public needs and democratic values.

The ICC incident has shown that every data center is, in effect, a potential U.S. military base—a point of control that can be activated when geopolitical interests demand it. The question for Canada and other nations is whether they will continue to accept this vulnerability or whether they will build digital infrastructure that truly belongs to their citizens.

The path forward requires more than just switching cloud providers or developing domestic alternatives. It demands a fundamental reimagining of how we approach digital technology—not as a commodity to be outsourced to the highest bidder, but as essential public infrastructure that should be developed and controlled in the public interest.

This is not a technological challenge but a political one. It requires recognizing that the current model of digital development was a choice, not an inevitability, and that different choices are possible. The question is whether there is the political will to make them.