Nvidia is making bold moves with its financial resources as it seeks to capitalize on its leading position in the AI surge.
On Tuesday, the company entered into a €1 billion ($1.15 billion) agreement with Deutsche Telekom to establish an “AI factory” in Munich, aiming to increase Germany’s AI computing capabilities by half.
Named the “Industrial AI Cloud,” this initiative will deploy over 1,000 Nvidia DGX B200 units and RTX Pro Servers, utilizing as many as 10,000 Blackwell GPUs to deliver AI inference and related services to German businesses, all while adhering to the country’s data sovereignty requirements.
Deutsche Telekom revealed that initial collaborators include Agile Robots, whose machines will assist in installing server racks at the site, and Perplexity, which will leverage the data center to offer AI inference services within Germany for local users and enterprises. The telecom also highlighted digital twins and physics-based simulations as potential industrial applications.
The telecom provider will supply the project’s physical infrastructure, while SAP is set to contribute its business technology platform and software solutions.
This collaboration is unfolding as Europe’s tech sector urges EU policymakers to lessen dependence on overseas infrastructure and services, and to encourage the growth of domestic alternatives. Meanwhile, technology firms have voiced concerns that the EU’s AI regulations may stifle innovation rather than promote it.
Earlier this year, the EU pledged €200 billion to create “AI gigafactories” across Europe, targeting “industrial and mission-critical applications.” However, investment in AI projects within the EU has lagged behind the U.S., where giants like Nvidia, Microsoft, Google, and Oracle have collectively invested hundreds of billions to construct vast data centers and infrastructure for AI model and service development.
Deutsche Telekom clarified that this venture, which is anticipated to launch in early 2026, is independent of the EU’s AI gigafactory program.
“Mechanical engineering and industry have long been the backbone of this nation,” stated Tim Höttges, CEO of Deutsche Telekom. “Yet we face new challenges. AI presents a tremendous opportunity—it will enhance our products and reinforce Europe’s competitive edge.”
