Deutsche Telekom will invest almost €250 million in its Munich AI factory. The move strengthens Germany’s computing base and supports Europe’s digital sovereignty ambitions.
The operator plans to double computing capacity at the site. It will add Nvidia Blackwell Ultra B300 GPUs to current systems. The facility will also scale to 20 megawatts of capacity.
This investment targets rising demand from enterprises and public sector users. Companies need more local computing power for large AI models. They also need secure environments for sensitive data and industrial projects.
The Munich site will support simulations, product testing, and AI development. It will also support “physical AI”. This means testing robots and production systems in virtual spaces first. Companies can then reduce risk before real-world deployment.
Tim Höttges, CEO of Deutsche Telekom, said: “Germany must not only be a user of AI; it must also create value and prosperity itself. Telekom has moved forward here at a rapid pace. Now we are taking the next step and expanding. So ideas become innovative products, and innovations become growth.
“The world must take Europe seriously. Powerful AI emerges from the interplay of computing capacity, secure data spaces, high-performance connectivity, and a sovereign, secure environment. Together with partners from industry, academia, and the public sector, Telekom brings these building blocks together into a European AI ecosystem.
“The goal is not only to develop AI, but to put it into practice as a scalable business model – delivering measurable efficiency gains, new products, and additional value creation in Germany and Europe.”
For telecoms, this development matters beyond cloud capacity. Operators now position networks, data centres, and security as one platform. That helps them move up the value chain.
However, the expansion also raises practical questions. AI factories consume major power resources. Operators must balance growth with energy efficiency and grid availability. Customers will also expect clear pricing and predictable performance.
Even so, German officials view the project as strategically important. Karsten Wildberger, Federal Minister for Digital Affairs and State Modernisation, said: “Telekom thinks big and acts fast. In just a few months, it went from an idea to operations; after one year, it was fully booked, and now it is doubling capacity. This is exactly the mindset and pace we need to win the AI race for Germany and Europe. The federal government will do its part to help make further successes like this possible.”
Katherina Reiche, Federal Minister for Economic Affairs and Energy, added: “The next wave of artificial intelligence will fundamentally change the way we manufacture. Germany has a unique competitive advantage in this regard: the process expertise our industry has built up over decades. When we combine this expertise with powerful AI, we create industrial intelligence.”
The Munich expansion signals a broader shift in European telecoms. Connectivity alone no longer defines operator strategy. Secure compute, sovereign cloud, and AI infrastructure now form the next battleground.
