AI Data Centres to be Built by Deutsche Telekom & SAP
A consortium of German companies, including Deutsche Telekom, SAP and Ionos, are taking a significant step in advancing Europe's AI infrastructure ambition.
These companies are striving to establish a state-of-the-art AI data centre as part of the European Commission’s initiative for AI gigafactories.
This strategic move is designed to bolster the region's capacity in AI technology and enhance competitiveness against dominant players like the US and China.
Reported initially by Handelsblatt, Deutsche Telekom, in partnership with SAP, Ionos and Schwarz, has initiated plans to secure support from the European Union (EU) for constructing a data centre dedicated to AI development in Germany.
This initiative follows the European Commission's announcement of a funding scheme providing €20bn (US$20.9bn) to support the development of AI-focused data centres across the continent.
The EU's vision includes the establishment of five such centres, also known as gigafactories, which will serve as crucial infrastructure to maintain Europe’s competitive edge.
These gigafactories are designed to host advanced compute power and automation capabilities, necessary for training next-generation AI models.
“The window of opportunity to create our own independent infrastructure for this is now,” Christine Knackfuss-Nicolic, Chief Technology Officer of Deutsche Telekom's T-Systems division, tells Reuters.
“Rarely before have the signs and the common will in Europe been as strong as they are today.”
A closer look at the EU gigafactory initiative
This EU-supported project outlines the construction of three to five gigafactories within the bloc, each costing between €3-5 billion (US$3.39-5.66bn).
The aim is to leverage public funding to draw private investment, facilitated via European Investment Bank resources.
Each gigafactory is expected to house approximately 100,000 AI chips, providing the computational backbone for modern AI initiatives.
Germany has expressed substantial interest in hosting these facilities, with Ionos actively engaging in discussions with other key players and the German government.
“In principle, we see the European Commission's initiative as an important step towards greater digital sovereignty, and are interested in participating in it,” the company said to Reuters.
The EU has embarked on this initiative partly due to growing concerns about lagging behind in the global AI race.
While interest in AI remains intense, Europe's current data handling infrastructure is not adequately prepared for the power demands of large AI models.
This shortfall necessitates substantial investment in AI-capable data centres to fulfil future technological requirements.Deutsche Telekom, a leader in the telecommunications sector, is at the forefront of implementing sustainable AI practices in its data centres.
Notably, the company utilises AI solutions to enhance energy efficiency, aligning with broader sustainable development goals.
The firm also plans to expand its data centre reach, having announced an addition of five new locations in October 2024.
Exploring data centre expansion strategies
The details of the consortium's plans remain somewhat indeterminate, but the member companies are not novices in the data centre sphere.
SAP, for instance, operates a robust network of at least 90 data centres worldwide, including key installations in Germany.
This extensive infrastructure allows SAP to consistently deliver high-performance, low-latency cloud services globally.
The proposed German AI data centre signifies a collaborative effort to significantly enhance Europe's digital infrastructure, thus fostering greater technological sovereignty in the AI domain.
This venture underlines Europe's commitment to establishing a robust AI ecosystem, capable of competing on the global stage.
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