TikTok plans to establish a second data center in Finland with an investment of one billion euros.

TikTok is set to invest 1 billion euros ($1.16 billion) to establish a second data centre in Finland within the next year, as part of its initiative to relocate data storage for European users to the continent, company executives announced on Wednesday, April 8.

This announcement follows TikTok’s Chinese parent company ByteDance successfully sidestepping a US ban related to data privacy issues in January, while European nations intensify their scrutiny on social media platforms to ensure the protection of children from harmful algorithms.

TikTok stated that the new investment of 1 billion euros will facilitate a data centre with an initial capacity of 50 megawatts (MW), potentially expanding to a total capacity of 128 MW in Lahti, situated in southern Finland.

This investment is part of the company’s broader “12 billion (euro) European data sovereignty initiative,” aimed at providing top-tier protections for the data of more than 200 million European users, according to information shared with Reuters.

Concerns over data protection

Finland has emerged as a hub for data centres, attracting companies like Microsoft and Google who are looking to minimize energy expenses and achieve climate objectives, drawn by the nation’s cool climate, affordable and low-carbon electricity, along with a stable and business-friendly regulatory setting within the European Union.

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However, Finnish officials expressed concern over TikTok’s proposal for its initial data centre in Finland, which was revealed by Reuters in April of the previous year.

Although Finland’s defence ministry approved the investment for 2024, local politicians were not kept in the loop. Finland’s then-minister of economic affairs Wille Rydman urged for a “reconsideration” of the project, citing security worries and a lack of transparency regarding the company’s intentions.

“At the very least, I would hope that this property development company would reconsider its choice in having TikTok as its tenant,” Rydman remarked to Finland’s public broadcaster Yle, referencing TikTok’s local partner.

TikTok indicated that its European user data is currently safeguarded across three data centres located in Norway, Ireland, and the US. The first Finnish data centre in Kouvola is expected to become operational by the end of this year, with the second scheduled to be completed by 2027.

The mayor of Lahti expressed enthusiasm regarding the new investment.

“In the context of Lahti, this investment is significant. We are delighted that a main tenant agreement has been reached and that the project is advancing as planned,” stated Lahti Mayor Niko Kyynarainen.