Construction of an £150 million (€191 million) Internet data centre, announced last year by UK firm MWB Konnect, has been put on hold and may be scrapped altogether.
Although a site in Ballycoolin, Dublin, has been cleared for the 500,000 sq. feet Web farm, no construction work has yet been undertaken.
It is understood a lock-in option on the site will expire shortly enabling other firms to make offers on the land.
Internet data centres or Web farms offer co-location space where companies can place the computer systems and servers to run their websites.
According to figures supplied by IDA Ireland, companies are planning to invest almost £1 billion in 22 data centres in the Republic over the next 12 months.
Mr Phil Moffat, technical director with MWB Konnect, confirmed the project had been delayed until the company found a large customer to commit to taking space in the centre.
If no customer is willing to commit to purchase at least 20,000 sq. feet before the option expired this summer, the company would review the development, he said.
"If you build a hotel and aren't getting enough guests, then you have to say are we in the right place," he added.
MWB Konnect's proposed data centre in Ballycoolin is double the size of existing data centres in the Republic, and would rival the largest existing European Internet-hosting facilities.
MWB Konnect planned to build the centre on a staged basis, with the outer shell costing £53 million and nine additional units being added over time at an estimated cost of £11 million each.
However, concerns have been mounting over the past few months due to the severe downturn in the technology and telecommunications sectors.
Investors have become increasingly sceptical about bankrolling data centre developments, as stock prices slump among the principal players in the sectors.
MWB Konnect is a joint-venture company established last October by property group Marylebone Warwick Balfour and European e-business incubator company Antfactory.
Although the company proposed building a string of data centres across Europe when it was launched last October, no construction work has been undertaken at any of the proposed sites.
Mr Moffat said preparatory work for a data centre in Frankfurt, Germany, was more advanced than its proposed Irish venture.
The company has identified and locked in land in Frankfurt, Lisbon and Madrid for data centres.
In recent months several Internet data centres have opened in the Republic, including developments by indigenous firms the Wolfe Group and Data Electronics, and multinationals such as Cityreach, Worldport and Inflow.com.
