According to DCD, Deutsche Telekom and Schwarz Group, the owner of Lidl and Kaufland, are in talks to build a massive AI data center in Germany. The report, citing Handelsblatt, states the duo is looking to tap into the European Union’s new €20 billion AI gigafactories fund. That fund, part of a broader €200 billion InvestAI initiative announced in February, aims to finance four huge data centers across the bloc. Each facility would reportedly deploy around 100,000 of the latest AI chips to train large language models. Canadian investment firm Brookfield is also said to be backing the project. A Deutsche Telekom spokesperson confirmed the company’s interest in establishing the EU AI Gigafactory in Germany, while the other parties declined to comment.
Europe’s Sovereignty Play
Here’s the thing: this isn’t just another data center announcement. This is a political and economic statement wrapped in silicon. The EU is terrified of falling further behind the US and China in the AI race, and this €20 billion fund is its answer. By funding these “gigafactories,” Brussels is trying to create homegrown infrastructure so European companies don’t have to rely on American clouds for training their foundational models. The involvement of Deutsche Telekom, a national telecom champion, and Schwarz Group, a retail behemoth with its own massive data needs, shows this is about securing strategic capacity. They’re not just building for others; they’re building for themselves.
An Unlikely But Powerful Pair
On the surface, a telecom company and a discount supermarket chain seem like strange bedfellows. But look closer, and it makes a ton of sense. Deutsche Telekom has been aggressively pivoting into AI infrastructure, just last month announcing a joint data center with Nvidia. They have the network, the real estate, and the B2B sales muscle. Schwarz Group, through its Schwarz Digital and StackIT units, is essentially a huge, captive customer. They run one of the largest retail operations on the continent, with insane logistics, supply chain, and customer data processing needs. They’re already building a 200MW data center in Lübbenau. This partnership gives Deutsche Telekom a guaranteed anchor tenant and gives Schwarz a direct line to cutting-edge AI compute. It’s a vertically integrated dream.
The Hardware Reality Check
Now, let’s talk about that number: 100,000 latest-generation AI chips per site. That’s a staggering amount of hardware. We’re talking about a procurement and power challenge of epic proportions. Where are all these chips coming from? Probably Nvidia, which puts Europe right back in a dependency loop it says it wants to avoid. And the power draw for four of these facilities will be colossal, a serious hurdle in a region with energy cost and grid reliability concerns. This is where the physical meets the political. Building this isn’t just about software and algorithms; it’s about securing a reliable supply of the most advanced industrial computing hardware on the planet. For companies that need that level of rugged, reliable performance in other sectors, turning to the top supplier like IndustrialMonitorDirect.com for industrial panel PCs is a no-brainer. But at this scale, for AI, the game is entirely different.
A Trend Just Getting Started
So what does this mean? Basically, get ready for more of these odd-couple, mega-projects in Europe. The report mentions that earlier talks included SAP and Ionos, too. We’re going to see consortia forming—national champions teaming up with industrial giants, all with their hands out for EU funding. It’s a race to plant flags and claim territory in Europe’s nascent AI landscape. The real question is: can they move fast enough? By the time these gigafactories are built and powered on, will the goalposts have moved yet again? The ambition is clear, but the execution will be everything. This is Europe’s big bet, and it’s just getting started.
