EU puts £10m into Facebook data centres

The European Union has earmarked nearly £10m to subsidise Facebook's plans to build giant server halls near the Arctic Circle.

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Critics have slammed the plans for the halls, due for completion in 2014, as an unnecessary waste of EU funds.

The US company, valued at around $100bn (£63bn), says the grant was an incentive in picking Lulea, Sweden, for the "data centres". Facebook said the three centres, which will measure 300,000 square foot in total, will improve performance for European users.

Critics have slammed the plans for the halls, due for completion in 2014, as an unnecessary waste of EU funds. The money is allocated by the EU through the European Regional Development Fund. Its remit is to increase competition, cross-border co-operation and modernisation.

Pieter Cleppe, head of think tank Open Europe, said: "It's telling that EU funds meant to improve the life of Europe's poorest citizens are being used to support a thriving American company in one of Europe's richer member states."

Located just 60 miles from the Arctic Circle, Lulea was picked as the location for Facebook's first data centres outside of the US, partly because of its weather. The cold will chill the high performance computers.

Tom Furlong, head of data centres at Facebook, said the subsidies "have been a factor". He added: "Governments in many countries use this type of incentives to attract this type of investments." Builders have already begun work on the site, which is expected to create 30-50 production jobs.