Microsoft invests in Germany and Spain, but snubs Italy
Microsoft, in focusing on cloud and artificial intelligence, is betting on Germany and Spain in Europe with maxi-investments that also include training for the jobs of the future. And there is no shortage of competition with AWS and Google. Facts and numbers
In the meeting in Rome in mid-January between Bill Gates and Prime Minister Giorgia Meloni they talked about the risks and opportunities deriving from artificial intelligence (AI) but, apparently, not about investments. Microsoft, the most widespread software house in the world which also collaborates with OpenAI, will focus on Spain and Germany in Europe but not Italy.
MICROSOFT'S INVESTMENT IN SPAIN
Microsoft will quadruple its investments in AI and cloud infrastructure in Spain in the years 2024 and 2025, to reach 2.1 billion dollars (approximately 1.95 billion euros). This was announced yesterday by the Iberian president, Pedro Sánchez, and the president of Microsoft, Brad Smith. This is the company's largest investment in 37 years of presence in the country.
As reported by El Paìs , the giant will open a data center and a data center campus in the Madrid and Aragon regions respectively. These two infrastructures, the company explained, “will make the company's full range of artificial intelligence solutions available to Spanish and European companies and public administrations”.
For Smith, “Spain is one of the countries where AI is most widespread, but jobs are not created to the same extent,” writes the Madrid newspaper. “Between the third and fourth quarters of last year, we saw the use of generative AI by Spanish organizations increase more than fivefold in just one quarter. […] Our investment of 2.1 billion in just two years is trying to keep pace with the needs of the country,” he said.
ECONOMIC FORECASTS
According to the president of Microsoft, part of the solution to the retirements that will occur in the coming years will have to be compensated with AI and the jobs of the future that will be created. According to an IDC analysis reported by Expansion , these data centers could add 8.4 billion euros to GDP and contribute to the creation of 69,000 jobs between 2026 and 2030.
MICROSOFT'S INVESTMENT IN GERMANY
Last Thursday, however, it was the turn of Berlin, from where Smith announced Microsoft's commitment to invest 3.2 billion euros to double the AI infrastructure and cloud computing capacity in Germany, just as the economy faces its worst moment in 20 years. Again, this was the largest single investment in the company's 40-year history in the country and the sum also included an AI training program that aims to involve 1.2 million Germans by 2025.
The investment, DW highlights , is also the largest among those for AI already announced last year, when Microsoft decided to invest 3.14 billion dollars in the United Kingdom by 2026 and 3.25 billion dollars in Australia.
Smith also said that Germany ranks second in Europe for creating AI-based applications and that this is increasingly being adopted by German companies, but ranks 11th in Europe for AI skills.
THE COMPETITION ON THE CLOUD BETWEEN MICROSOFT, AMAZON AND GOOGLE
The latest announcements from the company founded by Gates and led by Satya Nadella, notes Expansion , are part of the plan that Microsoft outlined four years ago to boost its cloud business in Europe, where it plans to invest up to $12 billion to build data centers in 17 countries.
It is currently the second largest cloud provider in the world after AWS (Amazon Web Services) and in the last quarter sales of the Azure cloud service grew by 30% .
But to meet the challenges posed by the increased computing demand that will be produced by the spread of generative AI, in which Microsoft plays a key role as ChatGpt's lead partner, the company must scale its data processing infrastructure. However, “optimism about the company's strategy [of allying with OpenAI, ed. ] has led its market capitalization to exceed $3 trillion, surpassing Apple as the most valuable company in the world,” writes Bloomberg .
With the data center in Aragon, Microsoft follows, among other things, in the footsteps of AWS, which had already chosen it to locate its cloud region in Spain, announcing in 2021 its intention to invest 2.5 billion euros over ten years in its data centers in the country. Google also inaugurated its cloud region in Madrid in 2022, with Telefónica as a partner and will invest more than 530 million euros in the country until 2027.
According to Global Data data reported by Bloomberg , Europe's data center construction pipeline amounts to $82 billion in projects, second only to the United States.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/microsoft-investe-in-germania-e-spagna-ma-snobba-litalia/ on Tue, 20 Feb 2024 14:41:47 +0000.