Nvidia Partners with Deutsche Telekom for AI Factory in Munich

Nvidia has signed a significant partnership with Deutsche Telekom, investing 1 billion dollars to establish an AI factory in Munich. This initiative, named the Industrial AI Cloud, aims to enhance Germany's AI computing capabilities by fifty percent.

The facility will utilize over 1,000 Nvidia DGX B200 systems and RTX Pro Servers, equipped with up to 10,000 Blackwell GPUs, to provide AI inferencing and various services tailored for German companies, all while adhering to German data sovereignty laws.

As part of this project, Deutsche Telekom has announced early partnerships with Agile Robots, which will deploy robotic systems for server installation, and Perplexity, which intends to leverage the data center for local AI inferencing services.

The partnership also highlights applications such as digital twins and physics-based simulations for industrial firms. Deutsche Telekom will supply the physical infrastructure, while SAP will contribute its business technology platform and applications to support the project.

This collaboration emerges amidst calls from the European tech industry for reduced reliance on foreign infrastructure and a push for homegrown solutions. The European Union has previously committed 200 billion euros to establish AI gigafactories across the continent, focusing on critical industrial applications.

However, funding for AI projects in Europe has lagged behind the United States, where major companies like Nvidia, Microsoft, Google, and Oracle have invested significantly in large-scale data centers.

Tim Hottges, CEO of Deutsche Telekom, emphasized the importance of AI in enhancing product offerings and leveraging Europe’s industrial strengths. The AI factory is projected to commence operations in early 2026 and is positioned as a distinct venture from the EU's broader gigafactory initiative.