Google to Expand Data Center in Finland Again

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As demand for mobile video increases, Google Inc. (NASDAQ: GOOG) has announced that it will spend 450 million euros ($608 million) to expand its Finnish data center in Hamina. The Mountain View, Calif., company hopes this will help it cope with increasing volume from wireless devices and boost advertising revenue.

The stable electricity grid in Scandinavia and its cool climate that helps save on equipment cooling costs has attracted other companies looking to increase data capacity as well. Microsoft Corp. (NASDAQ: MSFT) said in September that it would invest 250 million euros in a new data center in Finland. In June, Facebook Inc. (NASDAQ: FB) opened a data center Luleaa, Sweden, its first outside the United States.

In addition, the Finnish government is looking to capitalize on the data-center boom by cutting the energy tax on companies investing in data storage there. That discount would begin next year, but it needs approval from the European Commission.

Google spent 150 million euros to expand its Finnish data center last year. The site, about 150 kilometers east of Helsinki, was a former newsprint mill when Google bought it in 2009 for 40 million euros.

Google shares were down fractionally in early trading Monday, at $1.025 in a 52-week range of $ 636.00 to $1,041.52.