The EU is already home to many OS contributors and companies. I like the Red Hat approach where you are profitable, but with open source solutions. It's great for governments because you get support, but it's much easier to compete, which reduces prices.
Smaller companies also give more of their money to open source. Bigger companies can always fork it and develop it internally and can therefore pressure devs to do work for less. Smaller companies have to rely on the projects to keep going and doing it all in house would be way too expensive for most.