Sustainable development

Europe risks falling behind without telecom scale, Telefónica says

Telefónica has called for a shift in Europe’s telecommunications policy, arguing that market fragmentation is undermining investment, digital competitiveness, and the continent’s technological sovereignty, according to a new blog post from the company.

In the post, Telefónica says Europe’s emphasis on maximising retail competition has produced a highly fragmented operator landscape. It cites industry data showing the average European operator serves around five million customers, far fewer than peers in the United States or China.

The company argues that this lack of scale explains Europe’s lower per-capita investment in telecoms infrastructure and is slowing the rollout of technologies such as standalone 5G, fibre networks, and sovereign cloud and AI platforms.

Telefónica points to recent reports by Mario Draghi and Enrico Letta as signs of a policy shift, with EU institutions placing greater weight on investment capacity, resilience, and dynamic efficiency alongside traditional competition objectives.

The blog post concludes that Europe faces a strategic choice between preserving fragmented markets or enabling responsible consolidation. Telefónica says carefully regulated mergers could support sustainability, reduce regional digital divides, and strengthen Europe’s digital infrastructure.

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How data centres affect electricity, prices, water consumption and jobs

Data centres have become critical infrastructure for modern economies, supporting services ranging from digital communications and online commerce to emergency response systems and financial transactions.

As AI expands, demand for cloud computing continues to accelerate, increasing the need for additional data centre capacity worldwide.

Concerns about environmental impact often focus on electricity and water use, yet recent data indicate that data centres are not primary drivers of higher power prices and consume far less water than many traditional industries.

Studies show that rising electricity costs are largely linked to grid upgrades, climate-related damage and fuel prices instead of large-scale computing facilities, while water use by data centres remains a small fraction of overall consumption.

Technological improvements have further reduced resource intensity. Operators have significantly improved water efficiency per unit of computing power, adopting closed-loop liquid cooling and advanced energy management systems.

In many regions, water is required only intermittently, with consumption levels lower than those in sectors such as clothing manufacturing, agriculture and automotive services.

Beyond digital services, data centres deliver tangible economic benefits to local communities. Large-scale investments generate construction activity, long-term technical employment and stable tax revenues, while infrastructure upgrades and skills programmes support regional development.

As cloud computing and AI continue to shape everyday life, data centres are increasingly positioned as both economic and technological anchors.

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EU moves to tax low-value e-commerce parcels

The European Commission welcomed the decision by EU Member States to introduce a €3 customs duty on low-value e-commerce parcels arriving from third countries.

A measure, which enters into force in July 2026, that applies to items valued below €150 and aims to restore fair competition instead of allowing online imports to benefit from longstanding exemptions.

The move responds to the rapid growth of cross-border e-commerce shipments and will operate as a temporary solution until the EU Customs Data Hub becomes fully operational in 2028.

Until then, the Council and the Commission will coordinate legal changes and IT systems to ensure smooth implementation and effective customs supervision across the Union.

Once the Customs Data Hub is in place, a permanent customs duty regime will replace the temporary measure, offering authorities a comprehensive view of goods entering and leaving the EU.

The €3 duty applies only to parcels sent directly to consumers and remains separate from ongoing negotiations on a handling fee intended to offset the rising operational costs faced by customs authorities.

The reform builds on earlier Commission proposals to remove duty exemptions for low-value parcels and forms part of the most extensive overhaul of EU customs rules in decades.

European institutions argue that modernised customs controls are essential instead of relying on outdated frameworks, particularly as global e-commerce volumes continue to expand.

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BBVA deepens AI partnership with OpenAI

OpenAI and BBVA have agreed on a multi-year strategic collaboration designed to embed artificial intelligence across the global banking group.

An initiative that will expand the use of ChatGPT Enterprise to all 120,000 BBVA employees, marking one of the largest enterprise deployments of generative AI in the financial sector.

The programme focuses on transforming customer interactions, internal workflows and decision making.

BBVA plans to co-develop AI-driven solutions with OpenAI to support bankers, streamline risk analysis and redesign processes such as software development and productivity support, instead of relying on fragmented digital tools.

The rollout follows earlier deployments that demonstrated strong engagement and measurable efficiency gains, with employees saving hours each week on routine tasks.

ChatGPT Enterprise will be implemented with enterprise grade security and privacy safeguards, ensuring compliance within a highly regulated environment.

Beyond internal operations, BBVA is accelerating its shift toward AI native banking by expanding customer facing services powered by OpenAI models.

The collaboration reflects a broader move among major financial institutions to integrate AI at the core of products, operations and personalised banking experiences.

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Mercedes-Benz nominates new supervisory board members to drive AI and sustainability

Mercedes-Benz Group AG has announced planned changes to its Supervisory Board, proposing the appointment of Katharina Beumelburg and Rashmi Misra at the company’s 2026 Annual General Meeting.

The move is intended to strengthen the board’s expertise in sustainability, industrial transformation, and AI, reflecting the company’s strategic focus on decarbonisation and digital innovation.

Beumelburg brings extensive experience in global sustainability and energy transition from roles at Heidelberg Materials, SLB, and Siemens. At the same time, Misra brings deep expertise in AI and emerging technologies, having held senior positions at Analogue Devices and Microsoft.

They will succeed Dame Polly Courtice and Prof. Dr Helene Svahn, who will step down in April 2026 after contributing to Mercedes-Benz’s strategic development in recent years.

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AI-powered grid pilot aims to cut energy costs in Ottawa

Canada has announced new federal funding to pilot AI tools on the electricity grid, backing a project designed to improve reliability, affordability and efficiency as energy demand grows.

The government of Canada will provide $6 million to Hydro Ottawa under the Ottawa Distributed Energy Resource Accelerator programme. The initiative will utilise AI-enhanced predictive analytics to forecast peak demand and help balance electricity supply and demand in near real-time.

The project will turn customer-owned technologies such as smart thermostats, electric vehicle chargers and home batteries into responsive grid resources. By aggregating them, Hydro Ottawa aims to manage local constraints and reduce costly network upgrades, starting in areas like Kanata North that are experiencing rapid growth.

Officials say the programme will give households more control over energy use while strengthening grid resilience. The pilot is also intended to serve as a model that could be scaled across other neighbourhoods and electricity systems.

The funding comes through the Energy Innovation Program, which supports innovative grid demonstrations and AI-driven energy projects. Ottawa says such initiatives are key to modernising Canada’s electricity system and supporting the transition to a low-carbon economy.

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YouTube offers creators payments in PayPal stablecoin

YouTube has introduced a new payment option for US-based creators, allowing them to receive earnings in PayPal’s stablecoin, PYUSD. The move adds another major tech company experimenting with crypto-linked payments, while simplifying the process for content creators.

PayPal manages the conversion and custody of the stablecoin, meaning YouTube does not directly handle any crypto. The feature uses YouTube’s existing payout system and follows PayPal’s broader PYUSD rollout earlier this year.

Stablecoins have gained attention among tech firms following the signing of the GENIUS Act in July 2025, which provides a federal framework for these assets. Stripe and Google are exploring stablecoins for faster settlements, reflecting rising interest in regulated digital payments.

PYUSD, which reached a market capitalisation of nearly $4 billion, is already integrated into several PayPal products, including Venmo and merchant tools. For now, the payout option is limited to US creators, with no timeline announced for expansion to other regions.

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AI use grows among EU enterprises in 2025

In 2025, one in five EU enterprises with at least ten employees reported using AI technologies, marking a significant rise from 13.5% in 2024. AI adoption has more than doubled since 2021, showing its increasing use in business across the EU.

Nordic countries led the way, with Denmark at 42%, Finland at 37.8%, and Sweden at 35%. In contrast, Romania, Poland, and Bulgaria had the lowest adoption rates, ranging from 5.2% to 8.5%.

Almost all EU member states recorded increases compared with the previous year, with Denmark, Finland, and Lithuania showing the most significant gains.

Enterprises mainly used AI to analyse text, generate multimedia, produce language, and convert speech into machine-readable formats. Analysing written language saw the most significant growth in 2025, followed by content generation, highlighting AI’s expanding role in communication and data processing.

Rising AI adoption is also linked to efficiency gains and innovation across EU businesses. Companies report using AI to streamline operations, support decision-making, and enhance customer engagement, signalling broader economic and technological impacts.

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OpenAI launches GPT‑5.2 for professional knowledge work

OpenAI has introduced GPT‑5.2, its most advanced model series to date, designed to enhance professional knowledge work. Users report significant time savings, with daily reductions of 40-60 minutes and more than 10 hours per week for heavy users.

The new model excels at generating spreadsheets, presentations, and code, while also handling complex, multi-step projects with improved speed and accuracy.

Performance benchmarks show GPT‑5.2 surpasses industry professionals on GDPval tasks across 44 occupations, producing outputs over eleven times faster and at a fraction of the cost.

Coding abilities have also reached a new standard, encompassing debugging, refactoring, front-end UI work, and multi-language software engineering tasks, providing engineers with a more reliable daily assistant.

GPT‑5.2 Thinking improves long-context reasoning, vision, and tool-calling capabilities. It accurately interprets long documents, charts, and graphical interfaces while coordinating multi-agent workflows.

The model also demonstrates enhanced factual accuracy and fewer hallucinations, making it more dependable for research, analysis, and decision-making.

The rollout includes ChatGPT Instant, Thinking, and Pro plans, as well as API access for developers. Early tests show GPT‑5.2 accelerates research, solves complex problems, and improves professional workflows, setting a new benchmark for real-world AI tasks.

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EU supports Germany’s semiconductor expansion

The European Commission has approved €623 million in German support for two first-of-a-kind semiconductor factories in Dresden and Erfurt.

A funding that will help GlobalFoundries expand its site to create new wafer capacity and will assist X-FAB in building an open foundry designed for advanced micro-electromechanical systems.

Both projects aim to increase Europe’s strategic autonomy in chip production, rather than allowing dependence on non-European suppliers to deepen.

The facility planned by GlobalFoundries will adapt technologies developed under the IPCEI Microelectronics and Communication Technologies framework for dual-use needs in aerospace, defence and critical infrastructure.

The manufacturing process will take place entirely within the EU to meet strict security and reliability demands. X-FAB’s project will offer services that European firms, including start-ups and small companies, currently source from abroad.

A new plant that is expected to begin commercial operation by 2029 and will introduce manufacturing capabilities not yet available in Europe.

In return for public support, both companies will pursue innovation programmes, strengthen cross-border cooperation, and apply priority-rated orders during supply shortages, in line with the European Chips Act.

They will also develop training schemes to expand the pool of skilled workers, rather than relying on the limited existing capacity. Each company has committed to seeking recognition for its facilities as Open EU Foundries.

The Commission concluded that the aid packages comply with the EU State aid rules because they encourage essential economic activity, show apparent incentive effects and remain proportionate to funding gaps identified during assessment.

These measures form part of Europe’s broader shift toward a more resilient semiconductor ecosystem and follow earlier decisions supporting similar investments across member states.

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