Brussels is set to announce plans to build massive computing hubs while critics stress there is almost no domestic artificial intelligence industry to use them<\/p>\n
The EU\u2019s plan to spend over \u20ac20 billion ($23.5 billion) on AI gigafactories has drawn sharp criticism ahead of its formal launch as lawmakers and experts question whether there is any real demand for the facilities.
\nEuropean Commission President Ursula von der Leyen first outlined the plan in February 2025 as the EU\u2019s answer to large-scale US computing projects. It involves building four or five mega facilities with a formal call for proposals set for this spring.
\nHowever, the project has been met with pushback from lawmakers. \u201cNobody could explain to me what is the business case they are planning with these gigafactories,\u201d German Greens MEP Sergey Lagodinsky has said.
\n\u201cI talked to some who are saying: \u2018we just need more compute in Europe.\u2019 But then, when I ask them, \u2018what for?\u2019 They say \u2018it doesn\u2019t matter, we just need more compute.\u2019\u201d Lagodinsky was quoted as saying by Politico.
\nIt is also unclear who the facilities would be used by, according to Nicoleta Kyosovska, a research assistant at a Brussels-based think tank. She described the planned datacenters as \u201ccathedrals in the desert,\u201d noting that Europe has only one AI company capable of using such infrastructure \u2013 the French startup Mistral, which is already building its own data centers.<\/p>\n
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A Commission spokesperson has defended the plan by arguing that Europe requires computing sovereignty to avoid dependence on other continents.\u00a0
\nThe skepticism comes amid broader concerns over global AI overspending. Alphabet, Amazon, Meta, and Microsoft reportedly plan to spend a combined $725 billion this year on AI infrastructure.
\nHowever, Gary Marcus, a professor emeritus at New York University, has described the planned spending as the \u201cgreatest capital misallocation in history.\u201d Tech analyst Ed Zitron has also noted that the economics of data centers \u201cdo not make sense\u201d given that most AI startups are unprofitable and the majority of data center credit deals are rated junk grade.
\nMeanwhile, consumers have also been venting their anger over the global chip crisis sparked by overzealous AI development plans.
\n\u201cThe reason why RAM has become four times more expensive is that a huge amount of RAM that has not yet been produced was purchased with non-existent money to be installed in GPUs that also have not yet been produced, in order to place them in data centers that have not yet been built, powered by infrastructure that may never appear, to satisfy demand that does not actually exist and to obtain profit that is mathematically impossible,\u201d software engineer Jatin K Malik surmised.<\/p>\n","protected":false},"excerpt":{"rendered":"
Brussels is set to announce plans to build massive computing hubs while critics stress there is almost no domestic artificial intelligence industry to use them The EU\u2019s plan to spend…<\/p>\n","protected":false},"author":1,"featured_media":34709,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[4,6,3],"tags":[],"class_list":["post-34708","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-environment","category-politics"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t