"regulate them" has mostly translated to "tax the most successful players in the form of non-compliance fees from byzantine EU regulatory structures".

I don't think the thing holding back Europe's tech market is that the US encourages allies to not allow backdooring proprietary software, or the cries that it's unfair that the US doesn't strangle their own tech market with equally burdensome regulation. The problem Europe's tech industry has faced is that the EU killed it in the crib with regulations, and now there's more fear of "what if there are bad side effects in being successful" than there is fear of never being successful.

Yes, it'd be great if there was a thriving market of mid-sized EU tech companies working in a well-regulated and consumer friendly market. There just isn't, though. I'm generally a fan of Doctorow, but the idea that the EU is just a few hackers reverse-engineering a new client for teams/youtube/whatsapp away from that world is hard for me to see.