BUSINESS ACROSS THE BORDER
Pacheco: AI, data centers are the new Wild West we can’t ignore
For the past couple of years, I have followed very closely the artificial intelligence industry, specifically the proliferation of data centers throughout the U.S. Using AI, I discovered that with between 4,000 and 5,400 data centers, the U.S. has the most, representing 40-45% of the total across the world. The U.S. is followed by Germany (500 to 530), the United Kingdom (500 to 525), China (370 to 450) and Canada (380 to 430). The proliferation of new data centers continues as new projects are announced, not only in the U.S. but throughout the world.
Despite their proliferation, data center projects have become highly controversial, with supporters touting the huge investments these projects bring, the welcome tax collection and high-paying jobs. Detractors cite the amount of water used to build the centers and cool the servers. There are also concerns about the amount of power that data centers use and the emissions they generate. I have even read about complaints ranchers and farmers have made about data centers “stealing” their land. Concerns also surround the effect of AI on children and teenagers. In many cases, the lack of transparency and information about data center projects has been brought up.
All of these are concerns that the general public and data centers need to acknowledge, especially in the desert Southwest, where water is a major concern. It is literally the lifeline of humanity that lives there. Nobody wants to see their electricity bills go up if a data center comes to town and spikes the electricity pipeline, nor does anybody want to be near an emissions-generating source. Some communities and states have become proactive by passing laws in an attempt to regulate these types of projects.
Data centers have become the new cause of the not-in-my-backyard movement. They are the new cellphone towers that many people don’t want in their communities. People have the right to be concerned and to ask valid questions about these projects. However, so much misinformation, often intentional, has been spread about these projects. I recently read an interview with two New Mexico legislative candidates whose district does not encompass a huge data center project that is being built. They were asked by the reporter how the project was going to affect their district. Both responded that the project would have a negative impact on their community, which was again not even near the project. They were against the project as a matter of course, because that was the correct response in the election season. This reminded me of when the World Trade Organization held a meeting in Seattle in 1999, where hundreds of protesters showed up to cause chaos and protest globalism, which was the cause du jour of that time. Ironically, I noticed that most were wearing clothing and footwear from countries that had exported these items to the U.S. However, the cause meant more to them than the reality of global production sharing.
So many people are against data centers, but many of these people don’t realize that they use AI every day for help in everything from medical care to running their businesses. Whenever we look up trivia or research a new recipe, we are using AI that is generated out of data centers. Our nation’s defense system is being bolstered and modernized through the use of AI from data centers that are being used for military purposes. In fact, the military recently announced a nearly 1,400-acre data center project on Fort Bliss in east El Paso, Texas, for intelligence purposes.
Data center projects move fast because the industry is moving fast. AI is the new Industrial Revolution. Aspects of the industry are made up as they occur because of the speed of the industry. AI and the proliferation of data centers are the new Wild West, with new laws, guardrails and applications of technology being created on a daily basis. Although the U.S. is the dominant data center country, we are in competition economically and from a military standpoint with nations such as China.
I predict that those who harness AI to their advantage will be the knowledgeable class that creates wealth in the future. Those who shun AI will find themselves struggling. I am forcing my office to integrate AI into more and more of our workflow in order to stay sharp and competitive. Sometimes, I feel like my father, who refused for the longest time to switch from a flip-top phone to a smartphone, probably due to the fear and anxiety of having to learn a new technology.
Don't get me wrong. I live in a community in close proximity to a major data center project. I, too, am concerned about the major issues. However, I balance these concerns with the fact that our future as a nation will depend largely on AI, and how we stay ahead of nations such as China and Russia in this sense. AI can be compared to the nuclear age, which started in 1945 and rapidly escalated, not only for military purposes, but also for energy and science. If nuclear sciences had not been developed, many scientific applications would not exist.
Whether we like it or not, AI and its associated data centers are here to stay. At this point, it is impossible to put the genie back in the bottle. What individuals and communities need to do is educate themselves on AI and on data center projects that are coming to their communities. Data centers, on the other hand, must be transparent about resource consumption, what benefits their projects offer to communities and how economically struggling people can benefit from their presence.
Jerry Pacheco is the executive director of the nonprofit International Business Accelerator. He can be reached at 575-589-2200 or jerry@nmiba.com.