Mistral CEO Arthur Mensch made a compelling case for European investment in data center infrastructure at the Mobile World Congress in Barcelona, emphasizing the need for regional hyperscalers to boost the AI ecosystem.

Mensch, whose company is building its own data center in France, advocated for a decentralized cloud, urging European players to reduce their reliance on US tech and instead opt for homegrown solutions where possible. While acknowledging that some key tech infrastructure currently has no non-US alternatives, he stressed the importance of being "pragmatic" in this approach.

The Mistral CEO also touched on the topic of regulation, suggesting that the bigger challenge for businesses lies in dealing with fragmentation across the 27 Member States of the EU's single market, rather than the AI Act itself. He expressed support for consolidation in the telecoms space, which could facilitate partnerships between telcos and AI startups like Mistral.

Mensch highlighted the opportunities for AI to transform the telecoms sector, particularly in terms of network upgrades and distribution partnerships. He cited Mistral's existing agreement with French telecom company Free as an example, which provides Free subscribers with access to Mistral's AI assistant, Le Chat Pro.

Additionally, Mensch noted that AI could help telcos reduce their operating expenses, making the technology a valuable asset for the industry. While acknowledging that the current regulatory environment is "not ideal," he welcomed the shift in perspective among EU policymakers towards investing in AI.

Mensch expressed some reservations about the EU AI Act, suggesting that it came too early and is too focused on the technology side, making it difficult to implement. However, he emphasized that Mistral is working with regulators to resolve these issues.

Looking ahead, Mensch predicted that AI models will become increasingly specialized over the next couple of years. Mistral's focus will be on capturing data from every interaction between models and humans, which will be used to develop better, more personalized AI systems.

As the AI landscape continues to evolve, Mensch's call to action for European investment in data center infrastructure serves as a timely reminder of the need for regional players to take a proactive role in shaping the industry's future.