Microsoft to cancel Prague data centre project due to Czech bureaucracy

20
Oct
2023
News - Microsoft to cancel Prague data centre project due to Czech bureaucracy #Czech Republic #investment #Microsoft #Prague

by Property Forum | Investment

According to three independent sources of the daily e15, Microsoft will likely cancel its plans to build a data centre in Prague. "There is still some small hope, but it is more like wishful thinking on the part of the managers of Microsoft's domestic branch," one of the sources, who did not want to be named, described the project.


As e15 has previously reported, Microsoft bought a nearly six-hectare plot in Prague 9 from CPI for CZK 1.5 billion (almost €61 million) early last year. The Ireland-based European headquarters subsequently sent CZK 4 billion (€162.6 million) to the newly created Czech entity to finance the construction. One of the world's most valuable companies also wanted to run the data centre because of the upcoming state cloud or data protection regulations. But Microsoft has run out of patience because nothing is happening on the Prague site. This could be due to the uncertainties surrounding the zoning plan, the long construction procedure or the energy situation. "The legal requirements for the construction and operation of a data centre are so stringent that perhaps no other country in the world compares," said another source. Microsoft has not yet commented on its plans, but in the meantime, it opened a data centre in Poland earlier this year, where it is investing $1 billion. In the past, Google has also started a data complex there, with the investment expected to reach up to €2 billion.

The Prague 9 city hall, through spokeswoman Maria Kurkova, said it supported the project even before buying the land and that district representatives participated in negotiations leading to the possible permit. "If we don't signal to investors that we want them, they will go elsewhere. Perhaps to Poland or Romania," summarised Zdeněk Zajíček, president of the Czech Chamber of Commerce and head of the ICT Union, of which Microsoft is a member.

 




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