Europe is at risk of falling behind the United States and China in the development of artificial intelligence data centres due to insufficient infrastructure and investment, according to Nokia’s chief executive, who spoke on Thursday.

Nokia CEO Justin Hotard said that Europe currently lacks the necessary infrastructure to support large-scale AI data centre expansion, News.Az reports, citing Reuters.

While he acknowledged some positive steps taken by the EU, including the creation of AI gigafactories, he said the overall pace of investment remains inadequate.

“The issue today is Europe doesn't have the infrastructure,” Hotard said, adding that building AI capacity is not only about constructing facilities. “You need connectivity. You need data centre capacity.”

Major technology companies are expected to invest hundreds of billions of dollars this year into expanding AI-related infrastructure. However, Europe is reportedly lagging behind due to regulatory hurdles and energy-related constraints.

Data centres currently account for around 3% of electricity consumption in the European Union, but this figure is expected to rise significantly as demand driven by artificial intelligence increases.

Earlier in February, Amazon warned that long delays in securing access to power grid connections are creating obstacles for its data centre expansion plans in Europe.

Nokia, once the world’s largest mobile phone manufacturer, is now benefiting from its strategic shift toward AI and cloud services. The company’s AI and cloud segment currently represents about 8% of total group sales, and Nokia expects the addressable market to grow by 27% annually through 2028.

“We’ve seen the movie before. If you don’t build that infrastructure, then ultimately the business and developers will move to where that is,” Hotard said, referring to his experience after leaving Intel to join Nokia last year.

“At the moment, that is largely in China and the United States,” he added.

News.Az 

By Nijat Babayev