American internet companies can address a large, relatively homogeneous market of 300 million people that all speak the same language. This alone is a big competitive advantage over any European company.
Indeed. And not only common language, but ease of doing business with companies across the continent in general. Here in Europe, due to legal/language/cultural differences, and due to laziness, the default mode of operation for small companies in services is to avoid or neglect doing business with strangers from other parts of Europe. It is safe and comfortable, but does not create big multinational juggernauts.
More than that, if a service is created in the US, then it's much more than 300mi people potentially using it.
That is true for customer-facing softwre, but would not be relevant in e.g. semiconductors, compilers, formal verification.
For these B2B applications, it is important to have your potential customers in your network. One can argue that achieving such a network is easier in the US, where most of the potential customers presumably are.