The two competitive tactics are gaining popularity among European companies as a new era of industrial policy takes off in Europe and the U.S., and both regions re-embrace each other at China’s expense. European firms are either “fighting” large American tech competitors at home, lodging complaints to the European Commission over antitrust or cartel practices, or “fleeing” to the U.S. from Europe or China to take advantage of American industrial policy incentives.  

The Swedish music streaming service Spotify and the German online conference company Alfaview are among those opting for the first tactic in their attempt to gain ground against U.S. competitors. 

In 2019, Spotify filed a complaint with the European Commission accusing Apple of unfairly blocking access to its app, favoring Apple’s own music streaming services instead. 

Last year, Alfaview, a German competitor of Zoom, Teams, and Google Meet deployed the same tactic against Microsoft, alerting the Commission of Microsoft’s bundling of Teams with Office 365. That too resulted in unfair competition, it said.  

The European Commission will conclude the Spotify matter with a €500 million ($539 million) fine against Apple, the Financial Times reported this week. For Spotify, the more important consequence is Apple being forced to change how it deals with competitors such as the Swedish firm. The Alfaview case, meanwhile, is still pending. 

Europe clearly welcomes more European competition in the tech sector. The European Digital Markets Act, which will take effect this spring, is meant to “ensure fair and digital open markets.” It pits U.S. Big Tech against smaller European firms, offering the latter, homegrown firms a new chance to grow and succeed.

In other sectors, the “flight” tactic is more prevalent. As the lure of China fades and Europe’s growth slows, European firms are turning to the U.S. as their next investment destination. The U.S.’s healthy economy and President Joe Biden’s “Build America” agenda sweeten the country’s appeal.

Germany’s industrial multinationals are among the most eager to invest in the U.S. “German firms committed $15.7 billion in capital projects to the U.S. last year, marking a steep rise on 2022’s figure of $5.9 billion,” my colleague Ryan Hogg reported this week, citing an FT analysis. The flip side is that China is no longer Germany’s favorite FDI destination.  

Taken together, these fight-or-flight tactics constitute a fundamental shift in the global strategy of European firms. On their home turf, they’re attacking foreign competition, knowing that the European Commission is eager to rule in their favor. And abroad, they’re turning to the U.S. instead of China to capitalize on the changing geo-economic landscape. 

More news below.

Peter Vanham
peter.vanham@fortune.com
@petervanham

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AROUND THE WATERCOOLER

Telecom giant Deutsche Telekom’s Hungarian arm ditched its 4-day workweek because the benefits weren’t big enough by Prarthana Prakash

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This edition of CEO Weekly Europe was curated by Nicholas Gordon.