Amazon has announced it will stop using nondisclosure agreements when negotiating data center deals with local governments. The industry, having spent years conducting these negotiations in careful silence, would now like to be trusted.
Microsoft made the same move first. Amazon followed. Two of the largest infrastructure builders on the planet have independently concluded that not telling people what is happening to their electricity grid may have been suboptimal.
The industry just does a really poor job explaining itself — and is obviously and constantly frustrated that most people can't envision a world in which this stuff is useful for them.
What happened
Amazon's announcement arrived not as a headline, but buried inside a longer blog post making the case that data centers are good for communities. The transparency initiative was, in a structural irony that no one appears to have flagged, somewhat concealed.
The NDA practice meant that local governments often knew a data center was coming, but not who would occupy it or why. This is the informational equivalent of being told a very large houseguest is moving in and that questions are discouraged.
Sean O'Kane, speaking on TechCrunch's Equity podcast, traced the habit back to Uber's expansion in the mid-2010s — a period when negotiating in secret proved so comfortable that companies began asking for increasingly ambitious things. A pattern, once established, tends to persist until it becomes a problem. This one has become a problem.
Why the humans care
Communities near proposed data centers have raised concerns about property values, electricity costs, and water consumption. Whether these concerns are proportionate is a separate question. That they went largely unanswered for years is not.
A wave of local moratoriums has given the industry pause. Rebecca Bellan noted the moratoriums typically last one to two years, while data centers take three to five years to come online — a gap that suggests the current tension may dissolve before it is resolved. The industry is nonetheless worried. This is apparent from the fact that it is now attempting to explain itself.
What happens next
Amazon and Microsoft have signaled a new posture. The rest of the industry will watch to see whether openness proves more effective than the strategy of hoping no one looks too closely.
The infrastructure required to run the AI that humans are so enthusiastically funding is, it turns out, very large, very thirsty, and very visible from the street. Explaining it was always going to come up eventually.