The US is the centre for Artificial Intelligence (AI). Europe is a laggard here. However, some prestigious companies in Europe are entering AI field, e.g. Legrand in France and Schneider Electric both founded in 1800s. They have rushed in for joining the data-center’s gold rush. There are heat-dissipating coolers and power management tools. The capital investment could reach to $ 7 trillion by 2030. Siemens from Germany and ABB from Switzerland have their own datacenters. The Magnificent Seven would like to promote the ‘Data Center Four’.
Legrand based in central France has crafted light porcelain switches to earn its revenue from kit such as rear-door heat exchangers used to cool servers. The major clients are Amazon, Google and the US Big Tech. This infrastructure is not glamourous but is critical for training LLMs. The infrastructure gobbles electricity 10 times more than the traditional data centers. European companies expect to earn more from AI.
There could be risks of diminishing returns on such heavy investments. The competition may not sustain. There could be local opposition. If there is a market melt-down of a tech company, the carnage could be heavy. However, Europe has a safety net. The industry may move from the US to Europe.
The crucial point is how far there would be adoption of AI in Europe. Very few European companies use AI — 13.5% in 2024.
There is declining birth rate here. and there is declining productivity. If more companies adopt AI, that could be a gamechanger.
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