Digital Economy Weekly - July 27, 2025

Story of the Week

The Need for Global Thinking About AI

Existentialism but not of the philosophical kind is in the air. Government leaders throughout the world are understanding that insecure internet networks and websites are potentially prone to real, existential threats that can literally put their countries out of existence. National data sovereignty is a recognized issue, given the prospects of personal data, proprietary corporate information, and national defense secrets leaking all over the web. 

The ongoing AI boom only accelerates and complicates this issue. As talk continues of multi-trillion-dollar investments in AI centers, building out a global digital footprint from today's 50-55GW to 250-300GW, people are starting to speak up about their concerns of AI on this scale and how it can be put to malevolent purposes. The optimistic view of AI envisions smart agents expanding IT's capacity to dull lots of dull work for us, and the higher end job creation that an AI-driven Digital Economy can accomplish. But the dark side of AI-strengthened, “smart” netbots breaking and entering, stealing, and even trying to eliminate everything in their path cannot be ignored.

Regulation harmonization, which can sound like a bureaucratic exercise in obstructing progress, is in fact needed across the globe. There must be so-called guard rails, and a shared, treaty-driven commitment to the ethical use of AI and as much transparency as any governments run by humans can allow. The world needs a new Dag Hammarskjöld for the AI Age. 

There will always be tension between creating effective global governance and overweening global government, but this is not the time for absolutist thinking. It is time for doing the real, difficult work of real negotiation. Even the world's two largest economic actors, the United States and China – maybe especially these two – must address the serious issues of AI's potential versus its potential capacity for harm in a way that moves beyond statist, zero-sum thinking and somehow sees the light of day and encourages more light.

Links of the Week

The US AI Action Plan Springs to Life

AI is now receiving as high a profile as imaginable, with the announcement this week by the US Administration of the AI Action Plan. The plan is available through the White House website, and runs 28 pages in a 500K pdf file. It has three “pillars”: Accelerate AI Innovation, Build American AI Infrastructure, Lead in International AI Diplomacy and Security.

The expected direct concerns about competing with China are evident in the plan, as is a focus on “restoring” semiconductor manufacturing in the US. The plan is much more than a routine press release, though, with serious concerns raised about the overall US electricity grid, defending against bioterrorism, and the necessity to “align” security policies globally. Read here.

Stargate Proceeding Slowly, Axios Report Says

The idea of building out $7 trillion in data centers, as espoused earlier this year by OpenAI CEO Sam Altman, was not one to be taking seriously in the short term. Rather, this number, along with the smaller yet consequential number of $500 billion for Stargate AI center development in the US by OpenAI and two other companies, can be seen as a long-term vision and goal. It's not a surprise to see some recent reports showing how this big effort is off to a slow start. But projections from any number of sources, including long-time financial analysts, show the global data center footprint rising from about 50GW in 2024 to 250-300GW within a few more years. This level of buildout is perhaps a $3 trillion commitment. Another recent projection shows continued 23-percent annual growth, which would bring the global footprint to 250GW within a decade. Read here. 

Elon Musk's xAI Seeks $12 Billion in Private Financing

That guy Elon Musk is in the news again, as his AI chip and data center startup xAI reaches out to private equity to raise $12 billion. This company has reportedly run afoul of the US Administration as a result of personal friction, yet it continues on with its quest in the mad land rush for AI territory. One wrinkle is the thought that Musk-helmed Tesla could convince its shareholders to contribute substantial amounts – one number being thrown around is $500 million – to work with xAI to deliver the goods it wants to deliver, if Musk decides to try to work with public markets as well in this endeavor. Read here.

AWS Named As Company Behind Arizona's Proposed Project Blue

A secret memo from 2023 has revealed AWS as the developer behind a 290-acre proposed data center development in the Tucson, Arizona area. The memo calls for an investment of $20 billion over a period of 15 years, with a total of 150MW of new data center footprint to come online after a five-year development period. The project had previously been known under the stage name “Project Blue.”

Arizona and its two primary cities of Phoenix and Tucson has emerged as a large data center hub in recent years, in the fact of a lack of water in the dry Sonoran desert. Projected water consumption by the new facility is mentioned in the newly unearthed document, although there appears to be no mention of expected power and water resources to bring the project to fruition. Read here.

Telco Data Center in Kilimanjaro Region Aims to Boost Three Nations

Coordination among the nations of East Africa continues, with a recent announcement of a new telco-focused data center in the Kilimanjaro region, specifically in Uganda this time. The nations of Tanzania, Kenya, and Uganda can all benefit from cooperation within this region, which encompasses the north of Tanzania and the south of Kenya, with Uganda in proximity. This latter nation, in particular, is known for relatively high internet costs that impede the potential growth of its Digital Economy. Read here.

Intel Re-Ups Commitment to US, CEO Says

Intel CEO Lip-Bu Tan says the company “remains deeply committed to investing in the US,” as he has decided not to forgo new projects in Germany and Poland, while also emphasizing new development in facilities in Malaysia and Vietnam. The company remains in the midst of reducing its global workforce by 15 percent, which will result in a total of 75,000 employees at the end of 2025, according to an official statement.

Tan says he will reduce management layers at the company by half, and “empower engineers to innovate with greater speed and focus.” He continues to emphasize the company's foundry operations in his overhaul, revise the company's long-standing x86 processor line, and “refine” its AI strategy. Read here.

Visa Announces Data Center in South Africa

Visa has said it is “launching” its first data center in South Africa, although has been unclear about its specific location and size. The company currently operates data centers in the Us, UK, and Singapore. The South African initiative is part of what the company says is a $60 million investment – this would put the newly announced project in the single-digit megawatt range. 

South Africa has the most significant data center footprint on the continent, with several hundred megawatts of consumption online. Read here.

Heard in the Industry

“We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology.” – Carl Sagan in 1995, a quote now being paraphrased with the word “computers” and which could also use the word “AI” today.

Heard in the Aisle

"We lost the 5G wave. We lost it through technology, through policy, through bad strategic thinking. We simply cannot allow that to happen again." – Nvidia CEO Jensen Huang, in discussing AI.

Country Report: Canada

The following report was originally issued in a previous edition Digital Economy Weekly. Particular interest in it leads IDCA to republish it today, with some slight updates. Please contact IDCA if you'd like to discuss it further.

Oh, Canada, this “true north” country has sat in the shadows of the United States for 250 years. It has just 12 percent of the population of the US and 8 percent of the GDP, yet remains firmly among the world's largest economic powers (currently 9th in the world, between Italy and Brazil), and a member of the informal G7 club of the world's most consequential economies. Canada also scores well in the IDCA Digital Readiness Index of Nations. It currently sits at #14 among 183 nations (slightly ahead of Germany) compared to #35 for the US. The Index integrates hundreds of parameters into four broad categories – Economy, Environment, Social, and Governance – and Canada excels in each of them. 

• Its Economy score, which includes the amount of digital infrastructure relative to its income, scores 73 (on a 100-point scale) compared to the US at 67 and a world average of 67.
• Its Environment score, which takes into account renewable energy grids and CO2 emissions, scores 64 versus 49 for the US, and a world average of 40. Canada's massive hydroelectric power resources in Ontario and Quebec (much of which it sells to the US) underpins an overall electricity grid that is 67 percent renewable, compared to 20 percent for the US and 30 percent for the world. Canada's energy consumption is also supplemented by a 13-percent component of nuclear energy.
• Its Social score, which includes human development and income parity in the category's algorithm, scores at 63 versus 51 for the US and a world average of 42.
• Its Governance score, which takes into account corruption and stability, scores at 83 versus 72 for the US and a world average of 44.

Thus, overall Canada scores at 70 versus 59 for the US and a world average of 47. Canada's strengths and integration with the US market attract about $1 trillion of foreign direct investment (FDI) annually, half of it from the United States. This is about 18 percent the level of the United States, proportionally more than twice what would be expected given the size of its economy. With a less rigorous immigration program than that of the US, Canada has also seen its two largest cities, Toronto and Montreal, emerge as among the most diverse cities in the world, with particularly large segments of new residents and citizens coming from South and Southeast Asia.

With a population limited by a climate tenable for large-scale settlement only along a narrow tier in its southern latitudes, Canada's economic consequentiality will always be limited as well. But this nation has a distinct personality and culture, and enormously vast natural resources to bolster itself for the long term. Canada is thus a destination in its own right, rather than simply an alternative to the United States.

Inside IDCA

NEW: Comprehensive IDCA AI Report Now Available

IDCA has released its “Global Report on Artificial Intelligence (2025),” covering AI's impact on the $16 trillion global Digital Economy. The report also outlines the IDCA AI Readiness Index of Nations, which focuses on the potential of AI development and use of each of the nations of the world. The report was put together over the last several months by a worldwide team headed by IDCA AI Counsel Mark Minevich and IDCA Chief Research Officer Roger Strukhoff.

The Global Report on AI follows the publication earlier this year of IDCA's “Global Digital Economy Report (2025).” Both of the IDCA reports break new ground in examining not only the market-driven and technological aspects of Digital Economies and AI, but also of their impact on the world.

https://www.linkedin.com/posts/international-data-center-authority-idca_ai-artificialintelligence-globalreport-activity-7335273995367309312-b8Si/