Berlin, Germany - November 30, 2025 - Deutsche Telekom and the Schwarz Group are in advanced discussions to jointly develop a large-scale AI data center, described in German reporting as an “AI gigafactory,” and plan to apply for European Union funding set aside for major AI infrastructure projects. The talks form part of a wider push by German industry to capture EU support for domestic AI compute capacity.
Sources familiar with the matter told Handelsblatt the proposed collaboration would pair Deutsche Telekom’s network and cloud capabilities with Schwarz’s scale and land-holding strength, creating a consortium positioned to meet the stringent technical, grid-access and supply-chain requirements the EU program demands.
The partners are reported to be preparing an application under the European Commission’s initiative to finance several continental “AI gigafactories,” a EUR 20 billion (USD 23.19 billion) package designed to close Europe’s gap in large-scale AI compute.
While the discussions are described as advanced, neither Deutsche Telekom nor the Schwarz Group has issued a formal announcement, and no site, investment size or binding agreement has been disclosed. Previous reporting shows a number of German bidders, including combinations involving SAP, Ionos and other industrial groups, have been developing competing or collaborative proposals, underscoring a crowded domestic field seeking to host at least one EU-backed center.
Observers say the selection process will prioritize projects that can demonstrate rapid access to low-carbon power, secure supply chains for advanced AI processors, and tight integration with industrial and research ecosystems.
Industry analysts say Germany is uniquely placed to assemble the mix of telco infrastructure, industrial demand and renewable-power partnerships needed for such a facility, but they caution that the complexity of permitting, energy provisioning and chip sourcing will favor consortia that can demonstrate turnkey delivery at scale.
Deutsche Telekom’s recent moves, including a separate EUR 1 billion (USD 1.16 billion) industrial AI cloud partnership with NVIDIA, and Schwarz Group’s retail and logistics footprint give both parties assets that could strengthen an EU application should the partnership be formalized.
If a formal bid is submitted, the consortium will join dozens of other proposals across Europe that the Commission has already received, and firms expect Brussels to apply strict technical and environmental criteria in its selections. For now, the story remains one of competitive positioning: advanced talks that could lead to a signature bid, but not yet to a signed project or funding award.
