Data centers can create a new industrial ecosystem in Finland

The discussion about data centers in Finland is often focused on the claim that they do not benefit Finland sufficiently. The discussion emphasizes the concern that the highest added value of the digital value chain ends up elsewhere, when foreign entities control cloud platforms, artificial intelligence computing and the manufacturing of the necessary servers.

The question of the highest added value is very important, but it alone does not determine Finland’s position in the technological revolution.

Ownership of cloud services, artificial intelligence models and digital platforms is currently largely concentrated in the United States and China. Finland’s good operating environment for data centers does not give us the opportunity to choose the winners and losers of the global artificial intelligence and technology competition.

Although the highest added value in the digital value chain does not necessarily remain in Finland, the national value of data centers should not be underestimated. For Finland, the opportunity may lie above all in the area of ​​investment implementation and operations.

Historical reference point: forest industry

The biggest lesson of the forest industry is that repeated capital-intensive investments can create an entire industrial ecosystem and export industry.

The construction and maintenance of paper and pulp mills require machine shops, process technology, automation, maintenance, planning, energy production, chemicals and logistics. A number of Finnish success stories grew around this need.

From Valmet grew into a global supplier of paper, pulp, energy and automation technology. Ponsse took forest machine know-how to the world. diamond specializes in plywood, veneer and LVL industry technology. Turmoil built an international business out of Finnish engineering know-how. Kemira strengthened its position in process chemistry. In addition, a wide group of specialized suppliers was created, from machine shops to machine vision, cranes, valves, maintenance and factory systems.

Finland’s success was born from the fact that we grasped the industrial transition strongly enough: we built capacity, learned how to operate it and developed exportable companies around it.

In data centers, the logic can be similar

Data centers are the physical basis of the digital economy. Data centers are concrete industrial facilities: electrical connections, backup power, cooling, automation, construction technology, security, optical fiber, continuous maintenance and solutions connected to the energy system.

Finnish or even European companies will not necessarily own the highest layers of the value chain of cloud and artificial intelligence services. But if there are sufficient and frequent data center investments, they can increase domestic know-how and companies precisely in the area where Finland has inherent strengths: in demanding infrastructure, electrical systems, cooling, security of supply, construction, operation and utilization of waste heat.

That is exactly why data centers should be seen as an industrial policy opportunity. For Finland, it is essential to ensure that as many investments as possible are linked to domestic suppliers, know-how, training, energy infrastructure and the development of exportable solutions.

Finland needs a variety of industries

The policy should focus on developing the electricity grid, connection processes and capacity availability, so that new data center investments can be made possible in Finland. At the same time, the stability of the electricity system and the price of electricity for consumers must be taken care of. A high-quality electricity network and abundant production projects offer the opportunity to develop new electricity production and consumption together.

Finland needs both old traditional industry and new modern industry. Their confrontation does not serve a small export-driven country.

If data centers are not built in Finland, they will be built elsewhere. The capacity need for artificial intelligence and the digital economy will not disappear. Then also investments, learning, supplier chains, tax revenues and operating know-how will be born in other countries.

Data centers do not make Finland an artificial intelligence superpower. But they can make Finland one of the most interesting places in Europe to build and operate the critical infrastructure of the digital economy.

It requires that Finland treats data centers in the same way as previous industrial upheavals: not as individual construction projects, but as an opportunity to build a new industrial ecosystem in Finland.

Aleksi Taipale

CEO, data center developer Hyperco