“Such great trust”
Microsoft invests billions in AI in Germany
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It is the largest single investment in its history: Microsoft is investing 3.2 billion euros to expand its data center capacity in Germany. One federal state in particular has reason to be happy. And the Chancellor, too.
Microsoft will invest almost 3.2 billion euros in Germany over the next two years to massively expand its data center capacities for applications in the field of artificial intelligence (AI) and cloud computing. Microsoft President Brad Smith announced this in Berlin during a meeting with Chancellor Olaf Scholz.
The largest single investment in Microsoft's 40-year history in Germany also includes an AI training program that aims to reach up to 1.2 million people. The investment funds will flow primarily to North Rhine-Westphalia, where Microsoft plans to set up a new cloud region. The company is thus seeking geographical proximity to major customers such as Bayer and RWE in order to keep data runtimes (latency) between the data centers and the applications as low as possible.
Hesse also benefits
Hesse will also benefit from Microsoft's investments. The Rhine/Main region is Germany's leading location for data centers due to the large DE-CIX internet hub in Frankfurt. The existing Microsoft cloud region Rhine/Main will be further expanded.
Microsoft is making the investment “because we have such great trust in Germany,” said Smith. He said the funds will be used to significantly expand AI centers in Germany and training programs in AI.
Scholz praises his government
Scholz stressed that an investment of this magnitude “does not happen every day”. “We are currently seeing investments here on a large scale,” said the Chancellor, referring to the areas of batteries, cars, chips and pharmaceuticals. At the same time, the SPD politician praised his federal government. With the immigration law, it had created the possibility for the necessary skilled workers for the high-tech sector, for example, to come to Germany.
In addition, the Data Access Act in the medical sector is providing a boost to investment in the pharmaceutical sector. As a further element, the federal government wants to make investments more attractive with major legislative packages, for example to speed up planning. “We are (…) probably the most successful export economy in the world in view of the size of our country,” Scholz continued.
NRW Prime Minister Hendrik Wüst described Microsoft's investment as “a strong signal for Germany and a great contribution to structural change in the Rhineland.” With this billion-dollar decision, Microsoft is making a significant contribution to driving forward the sustainable transformation of the economy in North Rhine-Westphalia. “The fact that a global player is making such an investment in North Rhine-Westphalia is a sign of trust and the result of concrete location policy.”
Germany leads in investment announcements
With a total investment of 3.5 billion US dollars (3.26 billion euros), Germany tops the list of investment announcements by the world's leading software company: Microsoft President Smith pledged last November to invest 2.5 billion pounds (2.9 billion euros) in the UK by 2026 to drive the growth of AI applications. Just over a month earlier, during a visit to Australia, he had promised an investment of 5 billion Australian dollars (around 3 billion euros) in the AI sector.
Microsoft is a leading player in the international AI market, not least because the software company invested several billion dollars early on to get involved in the Californian AI startup OpenAI. The San Francisco-based company presented its text robot ChatGPT to a wider public in November 2022, triggering an AI wave.
Microsoft has meanwhile invested billions more to build up large computing capacities for training AI. The company uses the AI technology in its search engine Bing and as a “copilot” in its Office programs. The main competitor of the software giant from Redmond is Google with its AI program Gemini.
