Nokia CEO: Data Centers Could Be Built Twice as Fast With Better Supply
Justin Hotard, who previously led Intel's data center and AI group, argues that the current pace of data center construction isn't overbuilding, with Bain estimating a $6 trillion annual revenue need by 2031 and a Brookings paper suggesting a much higher $10.3 trillion bill.
Hotard, Nokia's CEO, believes the industry could build data centers twice as fast if memory and energy supply constraints were lifted. He maintains that demand will remain strong even without revolutionary new models for at least three years.
"If we could build 2x faster, our customers could build 2x faster," Hotard stated on CNBC's The Tech Download podcast.
He joined Nokia in 2025 after heading Intel's data center and AI division. Hotard noted that even without new models, "we could probably make tremendous progress just deploying the technology that’s there today."
Nokia, a company known for its connections rather than chips, saw its sales double to €446 million in Q2, contrasting with group sales of €4.82 billion. The company's shares have surged approximately 130% in the past year.
Hotard highlights the memory shortage, evident in rising DDR5 prices in Germany by 414% year-over-year, as a factor impacting phone manufacturing costs.
However, not all agree on the future demand. Bain's assessment suggests that AI's demand for data centers will only amount to $6 trillion annually by 2031, while Stijn Van Nieuwerburgh's Brookings Paper proposes a much larger $10.3 trillion investment between 2025 and 2032, comparable to historical booms in infrastructure.
Europe, with its limited figures, is pursuing a €30 billion AI gigafactory plan, with roughly €1 billion in public funding committed thus far.