How Utah locals fought Kevin O'Leary's AI data center

Today I’m talking with Josh Dzieza, a longtime features writer here at The Verge, about a massive data center in Utah that does not exist, might never exist, and yet has already completely reshaped the politics of the entire state. Josh just published a major feature this week on the struggling Stratos data center project in Utah backed by Shark Tank star Kevin O’Leary. So I invited Josh on the show to discuss what’s happening inside the AI industry’s infrastructure boom, inside the bipartisan backlash to data centers, and how the tech industry is running into the one obstacle it can’t seem to spend its way out of: local democracy. Read the ⁠full interview transcript on The Verge⁠. Links: The People of Utah vs. Kevin O'Leary | The Verge Adams — burdened by data center fallout — ousted by voters | Salt Lake Tribune ‘Shark Tank’ star sued by opponents he claimed were foreign agents| NYT Fox News apologizes for airing O’Leary claims about data centers | The Hill Kevin O’Leary agrees to downsize massive Utah data center | The Verge The biggest data center ever is becoming a huge problem in Utah | The Verge America's data center future is Loudoun County's past | The Verge The left and right agree on one thing: no data centers | Decoder Decoder is a Signal Awards finalist in the Business category! You can vote to help us win ⁠here⁠. Subscribe to The Verge to access the ad-free version of Decoder! Credits: Decoder is a production of The Verge and part of the Vox Media Podcast Network. Decoder’s producers are Greg Ott, Kate Cox, and Nick Statt. This episode was edited by Ursa Wright. Our editorial director is Kevin McShane. The Decoder music is by Breakmaster Cylinder. Learn more about your ad choices. Visit podcastchoices.com/adchoices

• 0:00Speaker 00

  Support for the show comes from CrowdStrike. It's not a huge stretch to say that AI is the next major computing platform. Every platform shift changes the way we build software, and it changes security, too. CrowdStrike is defining cybersecurity in the AI era with AI Detection and Response, or AIDR, a solution for seeing, monitoring, and securing AI across the enterprise. Learn more about how leading companies are turning to CrowdStrike to secure AI and secure their business at crowdstrike.com/decoder.

• 0:35Speaker 01

  Maybe that late-night ping is an urgent email from your CEO, or maybe it's a deep fake targeting your business. Doppel is the AI-native social engineering defense platform, fighting back against impersonation and manipulation. As attackers use AI to make their tactics more sophisticated, Doppel uses it to fight back, automatically dismantling cross-channel attacks, building team resilience, and providing agentic email protection. Doppel: Outpacing What's Next in Social Engineering. Learn more at doppel.com. D-O-P-P-E-L dot com.

• 1:15Speaker 02

  Company spending is complex. Managing it should be simple. AMX Corporate connects cards, expenses, and payments to streamline the way you work. Built to simplify, designed to scale. This is AMX Corporate. Get started at go.amex slash AMX Corporate. Terms apply.

• 1:40Speaker 03

  Hello and welcome to Decoder. I'm Neil Appetel, editor-in-chief of The Verge, and Decoder is my show about big ideas and other problems. Today, I'm talking with Josh Jezza, a longtime features writer here at The Verge, about Kevin O'Leary's plans to build a massive data center in Utah. The idea was to build the largest data center in the world, a 40,000-acre AI campus with more than nine gigawatts of power, more than double the average power usage of the entire state of Utah. The project is technically called Stratos, but it's more prominently known as Wonder Valley, a reference to O'Leary's nickname on Shark Tank. Josh has spent months reporting on this project, and it's fair to say Wonder Valley has completely upended Utah's politics. What Josh found throughout the course of his reporting was that the way this data center came together, how it was planned, how it was announced and approved, and how

• 2:22Speaker 03

  local residents were kept in the dark, ultimately created a political firestorm so severe it stopped Stratos in its tracks. Now, the details of what happened with Wonder Valley are obviously fascinating, but the story itself is also a larger look at the AI industry's infrastructure boom, the bipartisan backlash to that build-out, and how the tech industry is running into the one obstacle it can't seem to buy its way out of: local democracy. Okay, The Verge's Josh Jezza on the Utah data center disaster. Here we go.

• 3:01Speaker 03

  Josh Jezza, here, features writer here at The Verge. Welcome to Decoder.

• 3:04Speaker 04

  Thanks for having me.

• 3:05Speaker 03

  I'm very excited to talk to you. For people who don't know, Josh has one of the hardest jobs at the entire Verge. You just disappear for long periods of time, and then you come back with like 15,000-word home runs, which is an enormous amount of pressure, but you keep hitting them.

• 3:20Speaker 04

  It's a great job. Someone, Kevin, might say that editing those 15,000 words is the hardest job, but down to something manageable, but yeah.

• 3:30Speaker 03

  Kevin is our features editor, who works very closely with Josh. The home run we sent you out to get this time was the story of what happened with Kevin O'Leary in Utah, where he promised to build what was going to be the biggest data center in the world. He was all over the news, talking about building the biggest data center in the world. It was called Stratos. He was calling the entire development Wonder Valley. This thing fell apart in a bunch of anger from the local community. There's a defamation lawsuit because O'Leary referred to all of his critics as Chinese spies on Fox News. Fox News had to apologize on the air. When you started reporting on this story, it struck me that there would be some similarities to the huge feature he wrote about the Foxconn project in Mount Pleasant, Wisconsin, my

• 4:15Speaker 03

  hometown, where President Trump announced that Foxconn was going to build a massive LCD factory in the middle of Wisconsin. There would be 13,000 jobs, and none of that happened. And actually, what's funny about that is it's now, that land is being used for a Microsoft data center, which is just maybe the natural end state of all things. Walk me through those, just at a high level. What did this feel like to report?

• 4:37Speaker 04

  I did not expect this to feel so similar to Foxconn initially, because unlike the Foxconn project, the data center build-out is real, and at least theoretically can make sense in many cases. Like, these things are actually getting built, unlike an LCD tab in the middle of Wisconsin. It turned out that there are more parallels than I thought in, I mean, one, just sort of the actors that you have. You have, it sort of takes place mostly with local officials and planning meetings and things like that, and angry residents.

• 5:15Speaker 04

  But also, there's a lot more kind of data centers on paper, speculation, things that are maybe real, maybe not, that are difficult to suss out than I was fully aware of going into data center reporting.

• 5:32Speaker 03

  Let's start at the very start of this project. There's an enormous cast of characters involved. There's a whole bunch of government agencies. But this starts with people in Utah looking at, what is it, 40,000 acres of empty space and realizing that something is about to happen.

• 5:47Speaker 04

  Most people in Utah, except for a handful of people who own property in this remote valley, some people in the state government, at this one agency that becomes involved, a few real estate developers, everyone except that, maybe like a dozen people or so, found out about this project when Kevin O'Leary starts talking about it as an enormous data center that he's building in Utah called Wonder Valley, or sometimes Stratos, depending on what program they're using at the moment. But he comes out in late April and says, you know, "We're building this giant thing." And that's the first most people in the county and the state heard about it.

• 6:28Speaker 03

  How did he get the approvals to even begin saying he was going to start building this data center so publicly if no one knew about it?

• 6:35Speaker 04

  It is partly because it ran through an agency called MITDA. It's like a state development agency that deals with projects that have some military purpose. I think the military purpose can be fairly tangential. They have a luxury ski resort that gives veterans discounts, but it began as a way to create projects on military property that was unused or could be put to more economic use. And then the taxes go back to the state, some of which can fund military developments. It also has a lot of power to override local land use.

• 7:18Speaker 04

  It basically becomes the municipal government in whatever project area it establishes. So if it establishes a project area, in theory, it would really speed up all the sort of permitting and zoning and other regulations that can be a huge problem for data center projects. In order to establish a project area, the board has to ratify it. All the landowners in the area have to give their consent, and then the local government, in this case, the county, has to give its consent. The issue with this is, by the time Kevin O'Leary is talking about it on Fox in late April, MITDA has approved it, the county has not. The county didn't even know about it until about a month before this happened.

• 7:57Speaker 03

  So did Kevin O'Leary just go to this obscure military agency and say, "I need a bunch of land in Utah," and get it?

• 8:04Speaker 04

  According to the documents we have, he starts asking around at the state level with the governor in January, in early January. Then the project gets passed from the governor's office to MITDA. So January, February, he's basically going around, which is not uncommon with these developers, state to state, being like, "I want to build a data center. What you got?" And whoever kind of gives the best pitch, the best, you know, "You can have this property. We're going to make permitting easy. We have these tax breaks," wins. And this is also quite similar to what we saw with Foxconn, right? Like, and a lot of big development projects, people do this sort of beauty pageant, like, "We're auditioning this state. We're auditioning this state."

• 8:48Speaker 04

  It's a race, it's a competition, who's going to win. And so there was some of that, some of that going on there.

• 8:54Speaker 03

  O'Leary has been very publicly out in front. His big defense of the project is, "Well, states compete with these tax breaks, and Utah gave me these tax breaks." Somewhere in there is a big disconnect from the actual people living in the area and the process, right? I mean, that's the conflict here. That's the real heart of the story, is eventually the people in the area find out this is happening, and they don't want it to happen, and they mount furious pushback. What happened there?

• 9:24Speaker 04

  Yeah, it's a really interesting case with Stratos, where all of the conversations until very late are happening at the developer and state level. And in this case, they literally forgot, or failed, or for some reason, did not tell the county government that this was happening until very late, whose consent they needed. And so that happens in late March. The county commissioners start hearing rumors that, like, apparently there's a data center coming. They have no idea. They ask around. The state says, "We're sorry, I forgot to tell you," essentially, "but we really need your approval fast." The county commissioners then have a meeting in late April, and that's when word starts

• 10:09Speaker 04

  to trickle out, and then MITDA votes to approve it two days later. And then kind of over that weekend in late April, you've now had two public meetings. There's local coverage. People start talking about it, saying, "Oh, did you hear about the data center?" Several people found out about it, you know, at the coffee shop, at the grocery store. They just hear about it, they see it on Facebook. They're like, "Oh, there's a big data center coming." For some reason, the Shark Tank guy is involved. And that starts to kind of trickle out late April, when you start to see that conversation happen. No one was happy about it. Everyone...

• 10:43Speaker 04

  You know, one of the interesting things about data centers right now is social media is so full of data center backlash stories. People hear data center, they like know broadly what's coming, some of which is exaggerated, some which isn't, but like you don't need to get people up to speed that they they realize, oh, my God, there's this huge project is supposed to be, you know, they're saying it's nine gigawatts and it's coming to your metaphorical backyard.

• 11:06Speaker 03

  This is the big difference in in my mind between the Foxconn reporting and the Stratus reporting you did. So many people in Wisconsin were excited about the promise of a giant illusory LCD manufacturing plant that they ignored the very obvious fakery. And in the course of that reporting, you would literally go to empty buildings and point out that they were empty and Foxconn would issue statements saying they were not empty. And it was all just built on people's hope, right? It was an inkblot test about whether manufacturing could come back to the Midwest. And so many people wanted to believe that, that they ignored the obvious realities. In this case, if they had let Kevin O'Leary build a data center, it seems very likely that he would have built a data center.

• 11:50Speaker 03

  But the people there did not want that. It was the very opposite. All of the hopes and dreams were replaced by people's anger and fear about AI and maybe what they'd heard on social media. How did that play out in this story? Because that feels like a massive point of of departure.

• 12:07Speaker 04

  And Stratus is a really interesting case because it is kind of what you've seen played across the country by times 100 because Kevin O'Leary is involved and his sort of knack for attention. But the response was was immediate. I mean, people found out about it, you know, through local coverage. They start organizing to attend the next meeting. It's already contentious. People are calling out questions. They're not happy about it. And Kevin O'Leary starts talking up how huge it's going to be. And it really just escalates. You have the weird political alignments start to form, kind of everyone is against it. Some of it, and activists always something interesting that is kind of the most unifying issue in

• 12:49Speaker 04

  politics right now because not because people agree on data centers, but because there's something for everybody to hate. And so you have people who are upset for environmental reasons. You have people who are upset about the tax breaks, who are have people who are upset about just kind of like surveillance spheres with AI. You have just kind of everything in there. And people start protesting right away and saying, you know, we don't want this is something that you hear all the time at these protests. It's just really different from any kind of other big development projects because not only are people acutely aware

• 13:29Speaker 04

  of the cost, but there's no pros. It's not like people are excited for jobs. And Utah is not unlike Wisconsin, not a deindustrialized area. It's an agricultural community for the most part. Like, people are not nostalgic for the golden age of manufacturing. And they don't believe any of the jobs numbers anyone tosses out with data centers, I think, rightly, for the most part. And there's just not a lot of upside, you know, your county taxes might go down in 10 years. It's just not that exciting compared to where you're going to have a giant industrial project on the horizon.

• 14:05Speaker 03

  You talked to a lot of the protesters, the people who succeeded in having this project scaled down pretty dramatically. Who are these characters? What do you like?

• 14:13Speaker 04

  There's a wide range of people. I got some, one of the records that I thought was really fascinating that I got came from kind of a state intelligence fusion center thing, talking to the sheriff saying, you know, just heads up, it's in theory, a very combustible group of people who's going to be attending one of these rallies. You have, you know, conservative groups with names like Utah Patriot Alliance or something like that. And the sort of water preservation, like Salt Lake activists. Normally, these groups just counter protest each other, but here they've all come together for the same purpose that they hate this data center. And so you have just like a very wide spread of people,

• 14:57Speaker 04

  even within one of the key activist group. It's a lot of people who weren't activists before, just local people, some conservative, some progressive, people with environmental concerns, people who are just upset about it. A lot of people upset about the process, feeling cut out, like this is something that has really, is really offensive to them that this happened in their county with their county government and that they weren't told, they weren't brought into it. They had no say. I think that galvanized a lot of people. The people I spoke to, they're mostly residents of the county or sometimes nearby counties.

• 15:38Speaker 04

  But everyone who was kind of most involved was a was a resident of the immediate area in Box Elder, not necessarily Hansel Valley, the remote region where the where the center would be based.

• 15:59Speaker 00

  Support for the show comes from CrowdStrike. AI is already fundamentally changing how companies build products and run their businesses. If you listen to the show, you probably already know this. But while AI drives innovation, every new model and agent also creates new cybersecurity vulnerabilities. That's why CrowdStrike built AI Detection and Response, or AIDR. AIDR helps organizations discover where AI is being used, monitors AI activity at runtime, and helps teams detect, investigate, and respond to threats involving AI systems. As companies adopt AI, security has to be built in from the start. More than 70% of

• 16:41Speaker 00

  the Fortune 100 trust CrowdStrike to protect their businesses. Now CrowdStrike is helping secure the AI era. You can learn more about AI Detection and Response at crowdstrike.com/decoder.

• 16:58Speaker 05

  At T-Mobile, the new iPhone 18 Pro is here with a big leap in battery life. And you can get it for nothing upfront. With so many reasons to choose T-Mobile, you'll want to talk about it.

• 17:08Speaker 06

  I heard at T-Mobile, you can get iPhone 18 Pro for nothing upfront and get $1,000 off. Pass it on.

• 17:16Speaker 07

  Pay nothing today. No taxes, no fees, nothing down. Pass it on.

• 17:22Speaker 08

  Hey, Mickey, pass it on. iPhone 18 Pro has the most advanced iPhone camera ever. Pass it on.

• 17:29Speaker 09

  At T-Mobile, you can get iPhone 18 Pro for nothing upfront. Pass it on.

• 17:34Speaker 05

  At T-Mobile, get $1,000 off the amazing iPhone 18 Pro with no trade in needed.

• 17:40Speaker 10

  The 36 monthly bill credits when you switch to T-Mobile on a qualifying plan. If you cancel entire account before receiving all bill credits, credits stop and balance on required finance agreement is due. Example, $1199.99 iPhone 18 Pro 256GB. Bill credits end if you pay off device early. Qualifying credit, new line, cord in and service. $85 more per month with autopay plus taxes and fees required. $35 device connection charge due at sale. Visit t-mobile.com.

• 17:59Speaker 11

  Support for the show comes from PipeDrive. Sales teams spend up to 50% of their time on admin work rather than selling, building relationships, and closing deals. They could really use a tool that covers all the admin stuff. That way, sales teams could actually focus on the work they were hired to do. That's where PipeDrive comes in. It's an intelligent, AI-powered sales CRM loved by growing sales teams. Their new meeting intelligent features, like an AI note taker, are built right into the CRM. PipeDrive automatically pulls deal history, email records, and previous conversations. You can walk into a call already briefed. During meetings, PipeDrive's AI note taker records and takes notes. Then it

• 18:40Speaker 11

  turns those notes into accurate, auto-drafted CRM updates, ready for you to review and approve. In end result, less admin, more selling. Switch to a CRM built by salespeople for salespeople and join the over 100,000 companies already using PipeDrive. Our link gets you an exclusive 30 days free instead of the usual 14-day trial. No credit card or payment needed. Just head to pipedrive.com/decoder to get started. That's pipedrive.com/decoder and you could be up and running in minutes.

• 19:22Speaker 03

  When we first started talking about this story and you went off to report it, my assumption was that all of those folks would get steamrolled because we've seen that play out in so many of these other projects around the country. People mount some opposition. The local city council says it's already done. We have an NDA. We can't even talk about it. They scoot the meetings to the next one. There's protests. We've seen people get arrested for trying to talk about data centers at their local city council meetings. And there was just something about this one in particular, because it was Kevin O'Leary, this outsized personality, because it was so big, because the state officials could trumpet the size of the development, that it felt to me like there was a foregone conclusion. This project

• 20:04Speaker 03

  was going to happen over the objections of a handful of people in a very remote part of Utah. And yet, they succeeded. Tell us about how they pushed the project back, where it is now, and how they succeeded, because that seems like the important part.

• 20:16Speaker 04

  I think the project has definitely been wounded. I don't know whether it will happen or not, but it doesn't have the momentum that it had initially. I think there's a couple of reasons for that. One is just the scale of the backlash was so extreme that it took local officials aback. I don't think anyone anticipated that it was going to be so severe. The way it was announced, sort of Kevin O'Leary's 40,000 acres, nine gigawatts, biggest thing in the world. It's proximity to Great Salt Lake, which is shrinking, and Utah's in a drought, so extremely sensitive. The developers say it won't diminish the water going to

• 21:00Speaker 04

  the lake, but no one believes that. The residents don't believe that. It was just such a perfect combination of ingredients that it became, and it exploded right at the beginning of the Republican primary in the state. So officials are getting asked about it constantly. They're getting, you know, people are calling their office. They're showing up at debates. It becomes the biggest issue in the state. There were a lot of casualties of the project. You know, you had two local commissioners who lost their seats. You had Stuart Adams, who was the Senate president. You know, multiple sources referred to him as the king of Utah politics. It really sent shockwaves through the state that he lost his seat over this.

• 21:41Speaker 04

  I mean, there were other issues, but he was the MIDA chair, and so he was very much at the center of this project. It really, I think, was a wake-up call for politicians. It is not, the project is not dead. Basically, what's happened is activists, local activists, filed a referendum, trying to repeal the county's consent, and everything, it was thrown out by the county court, and now it's being litigated. And everyone has kind of hit pause on it for now, until that case gets resolved. But the data center race is all about speed, and now this is looking like it doesn't have that momentum it had earlier. You know, you have, you're going to have lawmakers, even if the referendum

• 22:26Speaker 04

  gets struck down, you have an extremely activated activist organization, network that has formed around opposing this data center. And it's going to not have a very easy road ahead of it. Just, you're going to have lawmakers scrutinizing it. You're going to have regulators scrutinizing it. There will be other lawsuits. It's just so unpopular, and it's so infamous. Like, why would you want to be associated with that project when you have so many other projects up here that you can, you can choose from?

• 22:57Speaker 03

  There's a Kevin O'Leary component to all of this, where he came out, he was very loud, he was the face of it. He almost didn't believe that there would be a grassroots backlash to him to build a data center. He did call all of these folks Chinese spies. He had to apologize for that. Fox News, where he said those remarks, they had to apologize on air for it. He posted an Instagram apology. You sent him a list of questions. This is real inside baseball, but, you know, to make a story like this, we do an email called the No Surprises email, where we just say all the things we're going to say, and people are allowed to respond to them. And his response to us was to have his lawyers lightly threaten us. Like, make sure everything's accurate. We're not, we're not responding to you. Make sure everything's accurate, or, you know, something bad will happen. He went from being

• 23:42Speaker 03

  the face to being so not wanting to be a part of the story that his lawyers spoke for him. Why do you think that happened?

• 23:48Speaker 04

  I mean, one, now he is in a defamation lawsuit. But I found his arc to be really fascinating as a window into the politics of data centers, because he came out kind of in a maximum conflict partisan posture. There's these protests. He immediately starts attacking the protesters. He reads names on Fox, says that they are being paid by China. Like, he goes on the offensive against them. And it just doesn't work. I mean, more than it doesn't work, it backfires. Like, it really, like, many people I spoke to in Utah came out because they were additionally insulted by the idea that they were being accused of being Chinese agents, you know, when they've lived there for generations. On another political

• 24:32Speaker 04

  issue, maybe he could have earned, gained some support. He's trying to play this race with China nationalist card. But it just, it just didn't work here. And it only kind of mobilized more people against him. He went on Tucker Carlson. Tucker, for the most part, was skeptical of the China argument, and kept pressing him on, you know, why, why would anyone want a data center? Like, why should anyone support this project? It's just really interesting to see the degree to which he failed to get any kind of partisan traction on this with that, with that strategy.

• 25:11Speaker 03

  You know, there's an interesting parallel here to the CEO of Flock, whose initial defense of Flock was to try to use MAGA talking points, and it also didn't work. And there's something about the political realignment here that is utterly fascinating to me. And it's coming right up against the speed that you mentioned, right? There's an entire industry that is built around trying to acquire money from hyperscalers as fast as possible by getting these deals done, by getting the permits, by going through the process as quickly as possible. And it feels like our politics in that process are in absolute conflict. Talk about that process a little bit. You would think that they would understand that they're up against the actual people in these communities not wanting this to happen.

• 25:56Speaker 04

  The Stratus Project is interesting. It's emblematic of a certain type of data center at this moment in kind of, I don't want to say late stage, but very well-developed speculative boom, let's say, where you have kind of random people from potentially-related industries who are being sucked into the boom and kind of trying to find an angle, trying to find a way into it. The data center race, if you want to zoom out, it's all about

• 26:35Speaker 04

  speed. You have a handful of hyperscalers who are locked in what they believe to be an existential race to AGI with each other, and will spend whatever it takes to win. That means they will spend, right now, whatever it takes, not just to build a data center, but to build a data center faster than their rivals. And that means you have billions, hundreds of billions, trillions of dollars flowing into anyone who will get them what they need as fast as possible. And so you kind of watch, over the last two years or so, these different aspects of data center development get totally jammed up. Like, initially,

• 27:19Speaker 04

  it was, all these giant data centers need to get connected to the grid. That's a slow process. It can take a year. It can take two years. It can take more, even in normal times. So everyone starts, sort of speculative developers start saying, making requests with various utilities, saying, I've got a giant data center. I want to connect it, start the study process. It jams up the queues. Utilities stop taking new applications. They charge money for them. Wait times get even longer. So then, data center developers go off-grid, behind the meter, what they call, but we're going to build our own power plants. It's always natural gas, because that is faster, a faster way to get 24-hour power than all the, you know, permitting and logistics involved with the nuclear plant, or solar

• 28:03Speaker 04

  and batteries, or something like that. Now turbines are backordered for years. So you have all of these other players who are kind of like...

• 28:12Speaker 04

  Trying to find ways to get the hyperscalers what they need. This is coherent into something called Powered Land Assembly. And what these developers do is they look for a bunch of property, how to secure access to power, and then turn around and sell it to a developer to build a data center. And it can be very lucrative. You know, these packages can go for 20 times or more what the raw land would cost. And basically, what the developer is paying for is speed. Your pitch is basically like, I've got land, it's already permitted. All you need to do is build the data center and put chips in it, and you're ready to go.

• 28:51Speaker 04

  A lot of announcements for developers say, yeah, I've got a 10 gigawatt facility here. We're building this gigantic, it's going to be the biggest data center in the world. This happens not just with Kevin O'Leary, but basically what they're saying is, Meta, if you wanted to get involved with this, you could have the biggest data center in the world, you could have 10 gigawatts facility here, it has that power capacity, maybe it has permitting for that, has the physical footprint for it. It doesn't mean, you know, we have funding to build a 10 gigawatt facility or anything like that. And so you have this kind of paper data centers out there. It is a symptom of the race dynamic here. Everyone, everyone is moving as fast as they can.

• 29:36Speaker 04

  The hyperscalers want to move as fast as they can. So you have developers who are trying to move as fast as they can. They are pressuring states to move as fast as they can to put an enticing package together for the developers that they can then turn around and give to the hyperscalers. At no part in this chain are local residents of a player. They're just not, they're just not there. Like, they're not part of this system. And so you have something like Stratos where just no one bothered to tell anyone in Bucks Elder County that anything was coming. They're all racing. Their concern is, can we get this deal together as fast as possible? It just doesn't come up.

• 30:19Speaker 04

  And so I think only now that you have projects hitting, you know, real roadblocks with, you know, people screaming at their commissioners until they don't rezone area, like you have like, now, now the people are obstacle to speed. Now people are like, now developers and hyperscalers are thinking about, well, how do we, how do we make people more okay with these projects?

• 30:44Speaker 03

  It strikes me that one other thing that should be an obstacle to speed here is the basic economics of AI, right? You have these essentially wildcatters trying to find plots of land with a favorable political process that will enable permitting, and they're going to sell it at 20 times its value to a hyperscaler that will then buy a bunch of Nvidia chips and then do something with AI to generate enough revenue to make all that worth it. And I don't think anybody knows what that is yet. Anthropic's S1 just came out. It is unclear from that document what that will be, but no one seems to care. Do these wildcatters just not care?

• 31:25Speaker 04

  No, no one, no one cares. That was one of the really illuminating things to me. Investor Paul Kudrowski explains what's happening here and why nobody in this system cares. And it's because these companies that are in this race are some of the most profitable, profitable, huge, credit-worthy, triple-rated companies of all time. And so

• 31:54Speaker 03

  But some of them are, just to be clear, right? Google and Meta and Amazon are, but OpenAI and Anthropic and the rest are not.

• 32:00Speaker 04

  And that is why you have with some recent OpenAI mega data centers, fairly complicated backstop arrangements with Nvidia and other companies that need to come in and say like, we're going to be good for the money, no matter what happens, essentially. And so what Paul explained was that the investors, because no one can pay for these projects, not even the hyperscalers directly, they're too huge, too expensive. So you have private credit, you have pension funds, like these sorts of entities who are coming in. And they see these projects as a reliable return for many years, because in the contract,

• 32:43Speaker 04

  Meta is good for it, no matter what happens with AI. And that's part of the reason you have this system kind of racing out of control, no matter whether people think AI is going to pay for itself, or they're not clear exactly how, but it has self-sustaining velocity, at least until the hyperscalers' credit comes into question.

• 33:09Speaker 03

  It seems clear that the political backlash might be able to pump the brakes here, and that's where I want to end. But I just want to ask about the financial component of it for one more turn here. Just in your description of that, I can lay out a lot of risk that makes Meta not good for it if this doesn't pay off, right? If the AI bubble pops, maybe none of these companies have any cash left to pay off these enormous bills. Is anybody taking that into account?

• 33:34Speaker 04

  I, I mean, no

• 33:39Speaker 03

  Sure.

• 33:40Speaker 04

  No one, no one I spoke to. I mean, no one, no one involved in the level, like, you know, no one who's developing Stratos, you know, that is not sort of of their concern. No one, you know, hopefully the pension funds or investors or credit agencies or somebody, the government, someone, someone is thinking about that. But I would say the financial actors, you know, they're keeping the process moving forward right now, I think. And you continue to, you know, in the defense of whatever is happening here, new capabilities continue to be unlocked with more data centers.

• 34:23Speaker 04

  And so you can hope that that will continue to be the case and that there will be a path to profitability at some point. To me, one of the big questions is, I, you know, I can't answer whether there's a bubble or whether it's going to pop. I don't know. I don't think anyone really knows. So only time will tell there. But I think one thing I was left thinking about with the story is, we're laying down a lot of infrastructure with a really long lifespan out of kind of immediate expediency. You know, we're building gigantic gas plants in the middle of nowhere, because that gets you a data center, you know, a year or two faster than some other method.

• 35:06Speaker 04

  And so you have a question of, even if, if AI is a bubble, you're going to have a bunch of giant gas plants in the middle of nowhere. That will be, somebody, I think, call them, you know, very expensive refrigerators, basically, in the middle of a desert. Even if AI works out, is that the best way to build your data center infrastructure? Totally disconnected from the grid on fossil fuels in the middle of nowhere? Like, this is not necessarily the most thoughtful way to build what's supposed to be a, you know, civilization-scale technology here.

• 35:49Speaker 12

  Why can't we get AI to production? Our competitors are all ready. How do we keep data secure? When do we actually see ROI? All this talk about AI, but talk doesn't transform businesses. AWS AI cuts through the noise, making AI easier to securely deploy and scale. With ready-to-use agents and the broadest set of AI tools and services, you can build, buy, or partner your way. Stop overthinking. Start building. AWS AI is how.

• 36:19Speaker 02

  Growing teams need a corporate card built for more, something that doesn't sacrifice speed for control. Introducing the American Express Corporate Cash Back Card. Get 1.5% cash back on eligible business purchases, advanced spending controls, and real-time visibility, plus intelligent expense management. Get started at go.amex slash amexcorporate. Terms and cap apply.

• 36:48Speaker 11

  Support for the show comes from Upwork. The most successful business owners don't do it all themselves. They know how to delegate. Upwork lets you build a team of highly skilled specialists for every function your business needs. Upwork gives your business fast access to highly skilled specialists, so you can fill critical skill gaps, launch projects faster, and scale support up or down without committing to full-time headcount. You can browse profiles, review past work, and get help scoping the role so you can hire with confidence and get started quickly. Upwork also has Business Plus, which lets you access the top 1% of talent on Upwork. With AI-powered shortlisting, you can get matched to the right freelancer in under six hours.

• 37:31Speaker 11

  And when it comes to things like contracts and payments, Upwork can help there, too. Plus, it's free to sign up, and posting a job is easy. Visit upwork.com right now and post your job for free. That is upwork.com to connect with top talent ready to help your business grow. That's U.P.W.O.R.K. dot com. Upwork.com.

• 38:01Speaker 03

  Let's bring this back to Utah, just to wrap it up. So the people on the ground in Boxer County, they mounted their opposition. They succeeded in getting this project scaled back. Kevin O'Leary has receded into the background behind his shield of attorneys. What can people around the country who are facing this kind of development in either in support of it or in opposition to it, take away from this story? What can they learn from it?

• 38:25Speaker 04

  I think one thing that was striking with Stratos was how just the sheer volume of outrage, kind of the response from the state and local government. Politicians still have to get elected. I think people have realized that this issue is so uniquely toxic that you've seen even politicians who are quite pro data center, running away from these projects lately in Texas and other places. And so I think that sort of, you know, people coming out, people writing their lawmakers, people protesting at commission meetings.

• 39:05Speaker 04

  I think that more than anything is why Stratos hit the roadblocks it did. Certainly the referendum and the litigation is kind of the most technical reason it might not move forward. But I also think just the sheer volume of criticism and objection has really branded the project in Utah politics as something undesirable, something you don't want to be caught blindly supporting.

• 39:33Speaker 03

  It's funny because there's one politician who has not walked away from data centers. President Trump, the day before we're talking, President Trump had his White House summit with all the AI leaders, and he just confidently said to cameras, people are going to love data centers. And it is unclear what mechanism will create this love, but he seems to think that that will happen in the end. Has that been a prevailing view in any of your reporting? Or is that just Trump wanting it to happen?

• 40:04Speaker 04

  I think it's Trump wanting it to happen. I don't know anyone who wants a data center in their backyard. I think that was one of the surprising things to me is that there's not really a pro data center constituency, other than, I guess, state officials who see them as attractive source of tax revenue and the people building them. Even the people who were selling land into the project were saying, they'll get paid. They're not happy this is coming. No one wants these things is something that somebody who was, you know, supporting the project because their land was part of the package told me, like, no one wants a data

• 40:44Speaker 04

  center in their backyard, even people who might directly profit from them. And so I would be very curious how any sort of pro data center, local constituency would form. I don't, from my reporting, see a path to that.

• 41:04Speaker 03

  When I talk to various folks in the tech industry, they are very eager to ascribe all this to NIMBYism, which is maybe the most coherent force that cuts across American politics, right? Just the power of people to say literally no to development anywhere for any reason, whether it is housing in cities or whether it's data centers in rural areas. The American belief in NIMBYism is strong. Is it just that's the lever we get to pull to stop AI? And so we're pulling it as hard as we can?

• 41:33Speaker 04

  There's certainly an element of NIMBYism behind this. I mean, it's people who are upset about the idea that this data center is going to, you know, ruin the local character. I mean, more than that, I think, I don't know if you could call concerns about environmental impacts, NIMBYism, but they're concerned about air pollution and heat exhaust and things like that. What are use, of course, comes up. So you have, under the umbrella of NIMBYism, concerns about how it will impact the place where they live, I think is probably the overriding, more than concerns about AI, is something that was animating the protests among the people I spoke with.

• 42:14Speaker 04

  AI came up, and I think this varies depending on the data center and the project and the, and the, kind of, the people who are opposing it. AI didn't come up that much with Stratos unless I asked about it. And I asked people who are like, would you feel differently if this data center was, you know, using like for emails or Netflix streaming or something, or an Amazon fulfillment center that used 9 gigawatts for some reason? And they also like, like, yeah, well, and then they would say, well, but at least a fulfillment center would create some jobs. And I think that is part of your answer about where AI factors. There's no pro case. They don't see a use for them. They don't see a need for AI. We don't need this is something they say a lot.

• 42:59Speaker 04

  And so it's just kind of all costs, more than anti-AI. I think it's anti-data center and not pro-AI. This was granted before the agents started hacking everything and we had a larger conversation about existential risk, but people just didn't see the point of it. It was just not a project with, that seemed like it was being done by people with their interests in mind. And it, it affected them in negative ways for no discernible benefit. And I think that's a lot of the opposition. I think AI can be sort of a vague cloud of things that don't help them, that are wanted

• 43:38Speaker 04

  by people somewhere else for reasons that are unclear versus, you know, concrete harms. I hear a lot more about the concrete harms of the data center than I did about AI job loss or anything like that.

• 43:50Speaker 03

  It seems unlikely that Meta's Muse agent is going to save enough money for people by searching their email for coupons to overcome that, right? Like, the consumer products in AI just have not taken off to overcome all of these concerns. This is the question I've been asking, if the data centers just said Netflix on them, would you be happier? And it seems like, no, even the benefit of having entertainment isn't enough to overcome the local harms.

• 44:17Speaker 04

  Yeah. I think they rightly had concerns about a gigantic gas facility in their vicinity near Great Salt Lake. And the fact that it was AI was more not a point in its favor than a point against it. But I think the way most, I mean, people, the people I spoke with, they used AI, but they would say, well, it's slightly better Google search, or like, I use it to make a birthday card or something. But like, why does that mean we need to drop everything to build a gigantic data center right here, right now? Why is this a matter of national security? That.

• 44:53Speaker 03

  And why is Kevin O'Leary the face of it? Which is just one of the funnier parts of this whole story.

• 44:58Speaker 04

  Wanted to do it was another question.

• 45:02Speaker 03

  What happens next here? Obviously, this project, Stratos, is tied up in litigation. We're going to see what happens there. We've been covering other big data center projects around the country as part of a larger package we've been doing. What do you think the state of the data center build out is and the temperature of the opposition?

• 45:16Speaker 04

  I think the temperature is still pretty high. I don't think it has, I don't think people feel better about data centers now than they did in May. The conversation has shifted a little bit more towards the danger, possible dangers of AI itself. I don't see how that helps the argument that we need to build as many data centers as possible everywhere. I think the developers and the hyperscalers have become more attuned to the need that they need to, you know, try to offer some sort of perks to the local population to not be completely hated. But I don't see a pro data center constituency forming.

• 45:59Speaker 04

  I think people will continue to oppose them. I think they will continue to be unpopular. Politicians will be less likely to, to offer tax breaks to sort of pave the way for them. But I do think they have plenty, I mean, data center developers, Stratos isn't even the biggest data center project in Utah. Like, there are other paper data centers out there that are kind of ready to be developed if the permitting comes through or they get the turbines or whatever. I don't know that it will slow the AI build out at a macro level, but I think it's certainly created some friction.

• 46:40Speaker 03

  Well, it's a great story. I really encourage people to go read it. Josh did an incredible amount of reporting on it. We gave it the full Verge treatment. There's a thing we do called scrollie telling on the web here at theverge.com. You can go experience it. Josh, thank you so much for being on Decoder.

• 46:53Speaker 04

  Thank you.

• 46:56Speaker 03

  I'd like to thank Josh Jezza for taking the time to join me on Decoder, and thank you for listening. I hope you enjoyed it. To get new episodes every Monday and Thursday, subscribe to our YouTube channel at DecoderPod and find us on TikTok and Instagram under at DecoderPod for more fun stuff we put out almost every day. If you enjoyed this episode, please send a link to it to someone you think you might like it. It really helps us grow the show. You can also subscribe wherever you get your podcasts. Decoder is part of the Verge and part of the Boxer Podcast Network. The show's producers are Greg Ott, Kate Cox, and Nick Statt. This episode was edited by Ursa Wright. Our editorial director is Kevin McShane. The Decoder music is by Breakmaster Cylinder. We'll see you next time.

• 47:32Speaker 13

  Your heart can tell you a lot about your health. Apple Watch Series 12 measures your heart rate every five seconds with the most accurate heart rate sensing and wearable. So your vitals app, now with heart rate variability, can tell you when something is off. And your readiness score can let you know when to rest and when to push. Hear the story in every heartbeat with Apple Watch Series 12. The features described are for wellness purposes only and not for medical use. iPhone 11 or later required. Based on Apple conducted study of heart rate accuracy, August 2026. Visit apple.com slash apple watch series 12.

• 48:04Speaker 14

  20th Century Studios presents the most incredible survival story of the year.

• 48:11Speaker 14

  Whale Fall. On October 16th, to survive the unthinkable, do the impossible. You're gonna become so dangerous that the predators can't help but let you go.

• 48:20Speaker 15

  We gotta get out of here. We gotta fall. We gotta fall.

• 48:26Speaker 14

  Whale Fall, rated PG-13, in theaters October 16th. Get tickets now.

• 48:31Speaker 01

  In this life, you can't win.

• 48:33Speaker 16

  When the world gets you down.

• 48:34Speaker 01

  No!

• 48:35Speaker 16

  Escape to Pluto TV.

• 48:36Speaker 05

  This is objectively fantastic.

• 48:38Speaker 16

  Relax into the movies and shows you already know and love, all for free.

• 48:42Speaker 01

  Shwing!

• 48:43Speaker 16

  Even our news is uplifting.

• 48:44Speaker 04

  You stay classy, San Diego.

• 48:46Speaker 16

  Watch School of Rock, Crazy Ex Girlfriend, Anchorman: The Legend of Ron Burgundy, The X-Files, Wayne's World, and so much more.

• 48:52Speaker 13

  We're not worthy!

• 48:53Speaker 16

  The best things on TV really are free.

• 48:56Speaker 13

  You just have to know where to look.

• 48:57Speaker 16

  Escape to Pluto TV. Stream now, pay never.