Nvidia and Deutsche Telekom enter into billion-euro partnership for Munich data center
Nvidia is playing fast and loose with its war chest as it looks to continue its momentum as the leading benefactor of the AI boom.
The company signed a billion-euro ($1.15 billion) partnership with Deutsche Telekom on Tuesday to create an “AI factory” in Munich that aims to increase AI computing power in Germany by 50%.
Called “Industrial AI Cloud,” the project will use more than 1,000 Nvidia DGX B200 systems and RTX Pro servers with up to 10,000 Blackwell GPUs to provide AI inference and other services to German companies while complying with German data sovereignty laws.
Deutsche Telecom said the project’s initial partners include Agile Robots, whose robots will be used to install server racks at the facility, and Perplexity, which will use the data center to provide “in-country” AI inference to German users and businesses. The telecom company also presented digital twins and physics-based simulation as use cases for industrial companies.
The telecommunications company said it would provide the physical infrastructure for the project, while SAP would provide its business technology platform and applications.
This partnership comes at a time when the European technology industry is calling on European lawmakers to reduce their dependence on foreign infrastructure and service providers and promote the adoption of local alternatives. At the same time, tech companies have criticized the bloc’s approach to AI regulation, arguing that the rules only serve to stifle innovation.
The EU earlier this year committed €200 billion to create “AI gigafactories” on the continent, focusing on “industrial and critical applications”. But funding for AI initiatives in the European Union has been significantly lower than in the United States, where companies like Nvidia, Microsoft, Google and Oracle have pumped hundreds of billions into building huge data centers and various infrastructure to support the development of AI models and services.
Deutsche Telekom noted that this project, which is expected to start operations in early 2026, is separate from the EU’s AI gigafactory initiative.
“Mechanical engineering and industry have been the strength of this country,” says Tim Höttges, CEO of Deutsche Telekom. “But here too we face a challenge. AI is a huge opportunity. It will help us improve our products and strengthen our European strengths.”
