Europe’s Water Sector Bets on Data as Digital Deals Pick Up

Digital tools and targeted acquisitions are reshaping Europe’s water market, nudging utilities toward smarter, data-led services

8 Jan 2026

Europe’s water industry is going through a quiet makeover. For years, progress was measured in concrete and steel: more pipes, bigger plants, longer service lives. Now, change is showing up on dashboards instead.

Utilities across the continent are installing smart meters, sensors, and analytics tools to track consumption, detect leaks early, and get more from aging networks. The pace varies by country and operator, but the direction is clear. Digital tools are moving out of pilot mode and into everyday use, pushed along by public funding and pressure to boost efficiency and resilience.

That shift is also changing how companies buy and sell each other. Instead of blockbuster mergers, consolidation is happening in focused, strategic niches. Software, analytics, and smart metering are drawing the most interest. Diehl Metering’s acquisition of Preventio fits the pattern, adding data expertise rather than physical scale.

Large suppliers are rewriting their own playbooks. Siemens and Xylem still make pumps, valves, and other hardware, but software now sits closer to the center of their strategies. Siemens is folding water management into its broader industrial software portfolio, linking it with energy and transport systems. Xylem is pairing equipment with predictive services that help utilities catch failures before they become expensive emergencies. Diehl Metering is following a similar path, combining meters and digital platforms to simplify reporting and improve day to day insight.

Utilities are changing too. Many no longer want a simple supplier relationship. They want partners who can prove savings, reliability gains, and long term value. As digital systems spread, so do questions about data security, procurement rules, and who ultimately owns the information being generated.

Even with those uncertainties, the momentum is hard to miss. Digital tools are helping cut losses, manage costs, and respond to climate stress. Consumers get clearer bills and fewer surprises. Governments see gradual progress toward sustainability goals, even if results differ widely.

The next chapter looks competitive. Expect more targeted acquisitions as suppliers hunt for specialized skills. For a sector once known for caution, Europe’s water industry is learning to move with the data.