EU Lays Out $11.4B for AI Gigafactories07/30 06:10

   

   BRUSSELS (AP) -- The European Union is offering 10 billion euros ($11.4 
billion) in funding for firms to erect seven AI gigafactories as it seeks to 
close the AI gap with U.S. and China, the 27-nation bloc's executive said on 
Thursday.

   The European Commission said it would like the public financing to draw an 
additional 20 billion euros ($22.8 billion) in private investment.

   "Access to the raw scale of computing power within AI gigafactories is a 
strategic necessity for Europe as AI development accelerates," said Henna 
Virkkunen, the Commission executive vice president overseeing tech sovereignty.

   The efforts by Brussels to establish " tech sovereignty " have gained 
urgency as leaders worry about dependence on technologies from foreign 
providers, which they say could be "weaponized" against Europeans. U.S. 
President Donald Trump has railed against the EU over its tech regulations and 
China has limited the supply of minerals critical to the sector.

   Firms can now bid for contracts to build gigafactories that are planned to 
have at least 100,000 cutting-edge AI chips, making them roughly four times 
more powerful than the data centers currently running in the EU.

   The EU's current computing power -- delivered by a network of 19 AI data 
centers from Finland to Spain -- will more than double when these seven 
gigafactories come online.

   Europe lags far behind the U.S. and China in crucial sectors for the 
development of AI, according to a 2025 assessment by the U.S. Federal Reserve. 
China has an enormous electrical power capacity for data centers while the U.S. 
bags the lion's share of private AI investment.

   Europe doesn't manufacture many of the millions of components needed for 
data centers and electricity in the EU can cost double or triple what it does 
in the U.S. and China, according to a Commission report presented to European 
Parliament in June.

   "European businesses and public authorities will continue to rely on US AI 
providers to the detriment of European service providers struggling to work at 
the frontier," said the report, which listed the bloc's top five cloud service 
providers as all American. "Dependence on hyperscale cloud and AI computing 
service providers, particularly for highly critical use cases, will continue to 
expose data to third-country access and carry risks to service continuity, 
endangering operational autonomy."

   France's Mistral now runs the one of the largest AI data center in the EU so 
far at its campus in Paris. Mistral makes the Le Chat chatbot but it hasn't 
kept pace with American AI companies like OpenAI, maker of ChatGPT, and Chinese 
rivals like DeepSeek.

   While political leaders like French President Emmanuel Macron have raised 
the alarm about Europe lacking homegrown AI companies, deep anxieties run rife 
across the continent about the economic disruption and privacy implications of 
the nascent technology.

   The Commission said AI products developed with the growing network of data 
centers will "follow EU standards on data protection, safety, security and 
ethics," perhaps referring to the bloc's Digital Services Act and its Digital 
Market Act.

   In June, 40 mayors around the world signed a pact to curtail the negative 
impact of the construction of AI data centers on the natural resources, energy 
prices or climate targets of cities from Phoenix to Melbourne.