The future is on the line
Essay by Tina Klüwer, AI researcher, founder of an AI company, and author
“On the line” was a commonly used phrase when answering a telephone in the early days. A sentence uttered with a sense of pride by a select group who owned one of these machines.
Where did this new technology come from? Most people associate the origins of the telephone with the United States and Alexander Graham Bell. Not many people have heard of Philipp Reis. As early as 1861, this German physics teacher presented his Telephon, a device for transmitting speech modelled on the human ear. Yet no one took him seriously. He received no funding and died of tuberculosis in 1874, never witnessing the breakthrough of telephony.
However, his machines were studied all over the world, including by Alexander Graham Bell. Developing the idea further, Bell was more successful in winning people over. Together with his future father-in-law, an assistant and a financial backer, he founded the Bell Company and patented the telephone in 1876. It marked the beginning of a decades-long success story.
A German invention that is brought to market success in the United States. Is this just a historical example or is it indicative of Germany’s innovation crisis today?
Germany is in recession, even as its research system continues to produce outstanding results. German universities rank highly, and the quality of research publications is excellent. Yet this success rarely translates into economic momentum. While the United States and China build billion-dollar industries from research, Germany often repeats a similar pattern: We invent the things others take to market. The gap is particularly visible in emerging technologies. Software platforms used by billions come from the United States, AI systems are dominated by American and Chinese corporations, and cloud computing was long underestimated in Germany.
Lest we forget that innovation is a central driver of growth and prosperity—as the Nobel Prize in Economics once again demonstrated in 2025. Inventions are the seeds of innovation. Estimates suggest that up to 75 percent of inventions emerging from German research remain unused outside of research. At the same time, Germany’s innovation capacity has been declining for years. In 2025, Germany dropped out of the top ten of the Global Innovation Index for the first time—the ranking that compares the innovative strength of 140 economies worldwide.
Declining prosperity is only one side of the coin. Growing economic dependence also makes Germany and Europe politically and strategically vulnerable. In areas such as digital infrastructure, software, computing and microchips, Europe relies heavily on external suppliers—some from countries with systemic rivalries. A similar dependence is now emerging in AI infrastructure.
And yet the foundations are there: excellent research, a traditionally strong talent base and high-quality education. The next transformative technology could certainly emerge from Germany. But achieving this will require systemic change. What is missing is a reliable bridge between the laboratory and the market. Building that bridge requires not only funding for top-level research but also sufficient capital for new products and business models, stronger support for academic spin-offs, greater mobility of talent instead of silo thinking, tolerance for failure, fewer regulatory barriers, and public procurement that actively enables innovation.
What is needed is a genuine appetite for the new and the willingness to overcome entrenched structures. The strict separation between research and industry has outlived its usefulness. Only when both spheres think and act together—sharing talent, resources and incentives—can knowledge unfold its full impact on society. For a successful transformation, inventing an innovative machine in Germany is not enough. Germany itself must become that innovative machine.
Tina Klüwer is an AI researcher, founder of an AI company, and author of the book Zukunft made in Germany. She supports science-driven start-ups, advises policymakers and companies, and speaks about issues like technological sovereignty, AI and innovation.
Book “Zukunft made in Germany”: https://www.rowohlt.de/buch/tina-kluewer-zukunft-made-in-germany-9783498007607
Tina Klüwer: Expertin für Künstliche Intelligenz und Innovation