Microsoft to Invest in German AI Infrastructure

Microsoft President Brad Smith announced his intention to direct investment funds for €3.2 billion ($3.4 billion) to the development of artificial intelligence infrastructure in Germany.

Microsoft to Invest in German AI Infrastructure

The implementation of the mentioned plan of the specified technology giant, according to preliminary data, will take two years. Brad Smith announced his intention to invest in the development of German artificial intelligence infrastructure during an event with Chancellor Olaf Scholz. Currently, the technology giant, which is the developer and supplier of one of the world’s most popular personal device software, is seeking to increase its computing power in Europe.

Brad Smith on Thursday, February 15, during a press conference with Olaf Scholz in Berlin, said that German companies are rapidly adapting technologies related to artificial intelligence. Separately, he noted that Microsoft is expanding its data centers in Europe.

Probably, a high-quality artificial intelligence infrastructure will become something like a source of support for the German economic system, which is currently going through difficult times. Advanced technologies have already ceased to be highly specialized tools, moving into the category of solutions of large-scale functionality. Artificial intelligence, according to many analysts, has the potential to become a catalyst for economic growth. It is worth noting that in this case, a large-scale, rather than limited, impact is implied. In the context of these prospects, the probability of which is high, the development of AI infrastructure is an important task, the successful solution of which will have long-term positive consequences.

Microsoft is currently making significant investments in cloud infrastructure and data centers. These efforts of the technology giant are being made in the context of its desire to become a leader in the artificial intelligence industry. In this case, an important aspect is Microsoft’s collaboration with OpenAI, the developer of the world’s most popular artificial intelligence-based chatbot called ChatGPT.

The technology giant’s strategy is viewed optimistically by outside observers. Against the background of the corresponding sentiment, the company’s market capitalization exceeded the $3 trillion mark. Microsoft has overtaken Apple Inc. as the most valuable firm in the world.

Mr. Smith said that the planned amount of financing that Germany will receive from the technology giant is the company’s largest direct investment in this country. The funds will be spent on the construction of data centers in North Rhine-Westphalia and in the vicinity of Frankfurt. Part of the investment will be used to train employees. Brad Smith also said that government subsidies for the implementation of the mentioned projects are not provided.

Currently, European regulators are encouraging cloud companies to store their data inside the EU, explaining the advantage of a corresponding solution with a high level of security and high-quality privacy. The total cost of data center construction projects in the region is $82 billion, according to Global Data. In terms of the mentioned financial indicator, the EU is second only to the United States.

Olaf Scholz said that investments from the tech giant are to some extent related to the fact that Germany has decided to remain an open country. He also noted that several other foreign technology companies are currently cooperating with Berlin.

Olaf Scholz’s ruling coalition is making efforts to establish Germany’s status as a major technological center. Berlin has decided on billions of dollars in subsidies for companies such as Taiwan Semiconductor Manufacturing Co., Intel Corp., and Infineon Technologies AG. Germany’s interaction with these brands is aimed at stimulating the production of chips.

As we have reported earlier, Germany to Back EU AI Act.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.