Two Fribourg villages threaten to scupper American firm Yahoo's data centre project in Avenches to protest against plans to erect high-voltage power lines.This content was published on March 3, 2008 - 09:29
While some business experts say the case is "exceptional" and should be resolved soon, for others it underlines the difficulties international companies face when doing business in Switzerland.
In 2006, Nestlé decided it would build a Nespresso coffee capsule production plant in Avenches. Last year, it was American internet giant Yahoo that announced it wanted a piece of the action on the outskirts of the former capital of Roman Switzerland.
In October Yahoo signed a deal to buy industrial land worth SFr4.8 million ($4.5 million) outside the town to build a regional data centre costing another SFr100 million that would employ 35 people and provide additional storage capacity for its European development.
But the Fribourg communes of Villarepos - 520 inhabitants - and Misery-Courtion - 1,350 inhabitants - saw the potential of the centre rather differently and last month lodged an official opposition.
They have linked their support for the project to their own long-running battle over a high-voltage power line that would run through the picturesque countryside, and which they say should be buried underground.
"We are not at all opposed to the Yahoo project in itself, on the contrary, we are delighted, but we also wanted to raise awareness among the population about this power line," Jean-Daniel Andrey, mayor of Misery-Courtion, told swissinfo.
The line, which is aimed at linking eastern and western Switzerland, has repeatedly run into local opposition and has been delayed by almost thirty years. The latest proposed section south of Lake Murten faces over 250 official complaints from local residents.
Who's got the power?
With its banks of computers, the data centre is expected to be energy-intensive, using 20 gigawatts of electricity per hour, or four times the annual consumption of the town of Avenches.
The communes fear it is likely to depend on power from the controversial new power line, a claim the local power company, Groupe E and Yahoo deny.
For the moment, the project remains blocked, but it's unsure for how long. The internet giant, however, would like to start operations in 2009. One condition for choosing the former Roman city is being granted a building permit within six months.
Jean-François Mathier, mayor of Avenches, is worried that Yahoo might walk away if there is any lengthy delay in the approval process for its plant.
"I understand [the communes'] concerns, but they shouldn't mix up the two affairs which are completely different," he told swissinfo.
A done deal?
Jacques Pasche, head of the Western Switzerland economic development service, felt the case was very rare but said the public's democratic right to oppose projects was something business people had to live with in Switzerland.
"It's obviously very annoying, as sometimes it can seem disproportionate, but you can't stop people feeling concerned by new businesses setting up," he said.
But Professor Stéphane Garelli of the International Institute for Management Development in Lausanne felt local opposition to new businesses was a "recurring issue" and the country was shooting itself in the foot.
"We are very attractive. But the problem in Switzerland is when you sign a deal it's not finished," he said.
Garelli drew parallels with the case of the US biotech firm Amgen, which was put off by opposition to its plans to build a SFr1.55 billion biotech plant on a greenfield site in Galmiz, canton Fribourg.
As a result, the company decided to choose a site at Cork in Ireland, but construction there has been put back by two years.
"With a country with direct democracy you can't change mentalities easily, but you can change procedures. You should have pre-approved pieces of land for office space, data centres or even a factory."
swissinfo, Simon Bradley
Yahoo's Swiss data centre
Yahoo chose Avenches for a number of reasons: the relatively cheap price for the land, the close proximity of one of the largest fibre optic connections in Switzerland along the Avenches-Bern motorway, and the guarantee that the Swiss power company, Groupe E, could supply the centre with electricity.
The company already has 20 data centres around the world. Plans submitted to the local municipality calls for a high-tech building, 220 metres long and 90 metres wide, which will offer 30,000 square metres of floor space on two levels.
Eight rooms housing computer servers will occupy 10,000 square metres of space, while 900 square metres will be devoted to offices. The roof will be covered with a wave-like complex of air conditioning units needed to cool the heat. Through a fibre-optic network, Yahoo expects to feed all of Europe with its products from Avenches.
A staff of 30 people will maintain operations at the centre year round. The centre, expected to be operational by 2009, will be located near the new Nespresso coffee production plant.
Another Internet giant, Google, announced earlier this year its plans to locate its European headquarters in Zurich.
Yahoo is an American public corporation and global internet company, which provides a range of products and services including a web portal, search engine, directory, mail and news. It was founded by Stanford University graduate students Jerry Yang and David Filo in January 1994.
On February 1, 2008 Microsoft announced a $44.6 billion takeover bid for Yahoo. Yahoo rejected the offer, saying it was inadequate, but indicated that it might be willing to negotiate if the price were right.