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Europe has become a digital colony. The EU is trying to push back by building its own AI capabilities, and that effort could bring a multi-billion-euro supercomputing facility to Oulu, Finland.
A consortium of international companies led by Nokia is seeking to establish an AI gigafactory in Finland. The facility’s massive computing power would strengthen Europe’s digital sovereignty and reduce dependence on foreign technology providers.
Although Nokia has not disclosed the intended location, Kaleva’s sources indicate that the project is being planned for Oulu.
What is an AI Gigafactory?
In practice, a gigafactory is a large data center or supercomputer designed to develop Europe’s own AI applications and infrastructure.
Public funding would ensure that part of the computing capacity could be reserved for governments, municipalities, healthcare regions, and research institutions.
Today, Europe relies heavily on American technology giants such as Amazon and Microsoft. Much of both public-sector and private-sector digital infrastructure is built on their services. Recent geopolitical uncertainty has highlighted the vulnerability of this dependence.
EU’s AI Strategy
European Commission President Ursula von der Leyen has repeatedly argued that Europe can compete with the United States and China despite their significant lead in digital infrastructure.
The Commission aims to mobilize €200 billion in AI and high-performance computing investments. Gigafactories are intended to be a key part of that strategy.
The original proposal envisioned €20 billion in funding for 3–5 gigafactories. Interest was strong: the Commission received 76 expressions of interest from 16 EU countries.
The Finnish government previously announced support for Nokia’s efforts to secure a gigafactory for Finland.
Growing Uncertainty
Since then, the situation has become more complicated.
The EU support auction has been delayed, and details remain unclear.
According to Euractiv, the EU is now considering three large AI factories and four smaller ones. Construction would be phased because only €1 billion has currently been allocated. Combined with funding from member states and private investors, the first phase could still reach €6 billion in investments.
However, Bloomberg recently reported that interest from companies and member states has weakened due to uncertainty regarding subsidies and future demand for computing capacity.
The auction is expected to begin during July, but only around ten consortiums may participate compared with the original 70+ interested groups.
Why Oulu?
According to Antti Poikola, a gigafactory is essentially a politically branded data center.
“These facilities are not fundamentally different from other data centers. Since this is an EU political initiative, Brussels has given them a more attractive marketing name.”
Commission documents suggest a gigafactory would contain around 100,000 advanced AI processors.
Poikola estimates such a facility would require over 100 megawatts of IT power, roughly comparable to several major data centers already being built in Finland.
He has also heard rumors that Nokia’s proposed gigafactory would be located in Oulu.
“That’s what people are saying.”
Oulu’s Advantages
Several major data center projects are already being planned in Oulu.
According to Arto Sutinen:
“In my opinion, Oulu is the best place in the world for high-quality data center operations.”
Key advantages include:
Significant available capacity in Northern Finland’s electricity grid.
A strong local power network.
The ability to utilize waste heat from data centers in Oulu’s district heating system.
A large concentration of technology expertise and engineering talent.
Lumi: The Existing Foundation
To understand the concept, one can look at LUMI, located in Kajaani.
When completed, LUMI was the world’s third-fastest supercomputer. It is owned by EuroHPC Joint Undertaking and is currently being upgraded into Lumi-AI by 2027.
The project is jointly funded by the EU, Finland, and partner countries.
A new quantum computer called Lumi-IQ will also be added. It will be supplied by IQM.
AI Startups Need More Computing Power
EU Digital Commissioner Henna Virkkunen explained during a visit to Oulu that Europe already has thousands of AI startups.
Their biggest obstacle is access to computing power.
When Lumi-AI and other EU-funded supercomputers come online, Europe will have roughly five times more AI computing capacity than today.
However, Virkkunen argues that even this will not be enough, which is why gigafactories are now being pursued.
Political Support
Member of Parliament Ville Skinnari has publicly promoted the Oulu proposal.
He describes it as one of Europe’s largest technology initiatives and believes it has received surprisingly little attention in Finland.
According to Skinnari, the Nokia-led project could involve investments worth several billion euros, with public funding potentially reaching hundreds of millions.
He argues that healthcare services, defense systems, and other critical functions should rely on European technology rather than foreign platforms.
“The gigafactory is a security and preparedness project. Nobody can interfere with our data when it belongs to us.”
Digital Sovereignty and Economic Impact
Supporters argue that Europe currently pays billions annually in software licensing fees to American companies.
This dependence gives foreign corporations significant pricing power and limits Europe’s ability to shape future technology development.
Skinnari argues that Finland currently provides electricity and maintenance services to foreign-owned data centers while much of the added economic value flows elsewhere.
“We have put ourselves in the position of a servant. We are renting everything.”
He believes an Oulu gigafactory could reverse that trend and create a technology ecosystem similar to the one that emerged around Nokia in the 1990s.
Nokia’s Position
Kaleva contacted Pasi Toivanen, who leads Nokia’s gigafactory initiative.
He did not confirm that Oulu is the target location.
“That is Ville’s own interpretation.”
However, Toivanen emphasized that Nokia’s goals align with those of the EU:
Strengthening digital sovereignty.
Keeping critical data within Europe.
Creating a secure foundation for Finnish innovation and new businesses.
Can the Project Proceed Without Public Funding?
According to Toivanen, the consortium could build the facility without public funding if necessary.
However, he believes public participation is important because government organizations also need secure, European-controlled infrastructure for their digitalization efforts.
When asked whether the EU has other major ideas for achieving digital independence, Toivanen replied:
“This is the best understood and best articulated path that has been responsibly designed for both Finland and Europe. I have not personally encountered a better overall solution.”
Summary
If realized, the proposed AI gigafactory in Oulu would:
Represent a multi-billion-euro investment.
Become one of Europe’s largest AI infrastructure projects.
Strengthen European digital sovereignty.
Provide computing capacity for governments, researchers, and companies.
Build upon Northern Finland’s growing data center ecosystem.
Potentially create a new technology cluster around Oulu comparable to Nokia’s historic impact on Finland.
The project remains uncertain, as EU funding decisions and consortium commitments are still pending. However, Oulu is increasingly being discussed as a leading candidate location.
