On Sunday, the Bank of International Settlements (BIS) put out its annual report and said, well, a bunch of things that I’ve been saying:

In the near term, the ongoing AI investment boom raises questions about the sustainability of the current economic expansion. The five largest hyperscalers are set to spend over a trillion US dollars on AI-related capital expenditure from 2025 through 2026. These commitments are outpacing earnings and the free cash flow of these firms, leading some to issue debt to raise additional financing.

As edifying as it is to see the bank for central banks say exactly what I’ve been saying for the last few years, this part is the one that both rocks as far as being right goes and sucks for the world at large:

Disappointment in returns could trigger a sudden pullback in financing and turn the capex boom into a protracted investment bust, with potential knock-on effects on financial conditions…should hyperscalers slow or halt the aggressive pace of capex deployment, many borrowers across the supply chain could struggle to replace lost revenue and service their debt.

No shit. In April of last year, I wrote a piece called “AI is a systemic risk to the tech industry,” where I outlined how the failure of one model lab, OpenAI, would have seismic effects down its supply chain, delivering body blow after body blow to NVIDIA, Oracle, Microsoft, and the various Neoclouds that serve its compute, the most notable of which being CoreWeave. 

Since then, OpenAI’s slimy tendrils have sunk into even more facets of the tech industry, and it has signed deals with the likes of Google, Amazon, Cerebras, and Broadcom, while also taking on more investments, including mammoth commitments from Softbank, which is only able to meet them by selling off prized stock in companies like ARM and NVIDIA, and by raising debt. 

The Committee on Energy and Commerce is the oldest standing legislative committee in the U.S. House of Representatives and is vested with the broadest jurisdiction of any congressional authorizing committee.

Today the House Energy & Commerce Committee holds an oversight hearing with NTIA Administrator Arielle Roth, and as former Deputy Administrator I’m watching. With the hearing kicking off, here are some initial thoughts to help you understand what’s at stake.

𝗧𝗵𝗲 $𝟮𝟮 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗶𝘀 𝗮𝗹𝗿𝗲𝗮𝗱𝘆 𝗮𝗹𝗹𝗼𝗰𝗮𝘁𝗲𝗱 𝘁𝗼 𝘁𝗵𝗲 𝘀𝘁𝗮𝘁𝗲𝘀. All BEAD funds, including the so-called "nondeployment funds," have already been allocated and directed to states. The $22 billion in unspent funds isn’t “savings” that reverts back to the Treasury; it’s part of the $42.5 billion spread out over accounts for each state, and the states can access that money as they meet more and more of the “Special Award Conditions” or “SACs” that govern its release. The problem with the $22 billion in remaining funding is that the SACs haven’t been set because NTIA hasn’t released the federal guidance it has promised is forthcoming. Essentially, states cannot touch the funds in their accounts without guidance from NTIA on how those funds may be used. And that guidance is very late.

𝗛𝗼𝘄 𝗹𝗮𝘁𝗲? When NTIA released its “Benefit of the Bargain” guidance last summer, it promised nondeployment guidance would follow "soon." Then it said the guidance would come in March 2026, along with additional guidance to implement the Administration’s AI Executive Order. Then March 2026 came and went. In April, Commerce Secretary Lutnick told lawmakers to expect it "over the next two months." That window has effectively expired.

𝗧𝗵𝗶𝘀 𝗱𝗲𝗹𝗮𝘆 𝗵𝗮𝘀 𝗿𝗲𝗮𝗹 𝗰𝗼𝗻𝘀𝗲𝗾𝘂𝗲𝗻𝗰𝗲𝘀. States are in limbo, unable to plan the workforce, affordability, and digital equity programs their communities need, and without further resources to meet the tough permitting timelines that NTIA’s BEAD Terms & Conditions require. Meanwhile, ISPs have begun declining subawards in some states, underscoring the need for clarification on whether the guidance will provide additional resources for states to ensure those locations are covered by other providers.

𝗢𝗻𝗲 𝗺𝗼𝗿𝗲 𝘁𝗵𝗶𝗻𝗴, 𝗮𝗿𝗴𝘂𝗮𝗯𝗹𝘆 𝘁𝗵𝗲 𝗺𝗼𝘀𝘁 𝗶𝗺𝗽𝗼𝗿𝘁𝗮𝗻𝘁: There is an OMB rulemaking underway that could have significant implications for programs like BEAD. Some have argued it could open the door to NTIA clawing back the nondeployment funds. But this isn't just a broadband story; it's a sweeping rewrite of how federal grant dollars work across virtually every program. Comments are due July 13. If you care about the future of BEAD — or federal grants broadly — file now.

This is the people's money: $42.5 billion to connect every American, and we have no clarity on how states can spend over half of it. Congress and the public deserve accountability on when and how the nondeployment funds will finally be put to work. Today’s hearing is an opportunity to push for that accountability.

Kalamazoo County, MI brought five subject-matter experts together Thursday to help residents understand what data centers and battery energy storage systems mean for communities like theirs.

The event, held June 25 at the Dale B. Lake Auditorium on the Kalamazoo Valley Community College Texas Township campus, drew a full house. Kalamazoo County Government organized the panel and invited residents, elected officials, and local government leaders to attend.

BT will receive a payment of $625 million from Verizon as the two companies combine their subscale international businesses.

Allison Kirkby's approach to the international assets of BT, the UK telco she runs, has been rather like that of Chris Patten to Hong Kong as its last British governor – execute an orderly retreat without (hopefully) causing anyone too much upset.

After taking charge of BT in February 2024, Kirkby soon made clear she saw the UK as her strategic priority and was likely to offload any units targeting overseas business. They were combined into BT International, a new entity chiseled out of BT's other parts and offered to prospective partners like an anemic bride. Today, BT announced its marriage to an equivalent part of Verizon.

Broadband Clusters reports  on a powerful way that the federal government has had to help schools get broadband to those who are less likely to have access at home...

Every year, the federal government helps schools and libraries pay their internet bills through a program called E-Rate, part of the Universal Service Fund. In 2024, it approved $2.76 billion in discounts for 21,102 institutions across the country: 18,507 schools and school districts, and 2,595 libraries. This study matches every funded institution to Census data for the communities around it, to examine who the program serves and what those neighborhoods look like.

Each week I curate 5 links from the data center sector that I find particularly interesting, with my commentary on why they merit your attention.

Sound interesting? Subscribe and get them every Saturday.

5 Notable Data Center Links

• The State of the AI Economy - In a detailed research piece titled “The State of the AI Economy,” analyst Azeem Azhar ‘s Exponential View Substack reports that quarterly AI revenues have begun to exceed depreciation costs on investments in servers and chips. Bloomberg (subscription) called the finding “a tipping point, showing that the hundreds of billions of dollars tech companies are spending on it may be economically sustainable.” If that trend holds, it could begin to ease concerns about the extraordinary hyperscale spending on GPUs and data centers. Although revenue is growing quickly, the cost side of the equation may be a moving target...

Facebook's silencing of a whistleblower ( Sarah Wynn-Williams, center above) shines a light on a private justice system and a "post-state" future where tech bros write the rules. Or as we call them, "laws".

Carole Cadwalladr (seated right above)wrote:

A note on who I am: I’m an investigative journalist who’s spent a decade reporting on the collision of technology and democracy including exposing the Facebook/Cambridge Analytica scandal for the Guardian and the New York Times. Two years ago, I called the alliance of Trump, Silicon Valley and a global axis of autocracy: a tech bro oligarchy, aka the Broligarchy. Please help me continue to expose it.

In 1995, Newt Gingrich killed the ability of the left to project power. It hasn't recovered. Plus, Trump picks a new antitrust chief, the end of cheap electronics, and the AI bubble wobble...

Right now, Russ Vought, Trump’s head of the Office of Management and Budget, is operating creatively and effectively to do deeply malevolent things. He thought very hard about how to run budgets to organize the government. But there’s basically no analogue on the left, little capacity to govern. And that’s why Mamdani, despite a mandate for significant change, can’t go as far as he otherwise might. What I want to do is trace where this gap came from, and pose some suggestions on how to address it.

There is, as usual, a history here. Someone with great foresight killed the left’s ability to govern, a long time ago.

In 1995, the Republican Party took control of the U.S. House of Representatives. Led by Newt Gingrich and a small group of right-wing politicians who called themselves “Jihadists,” these men sought to revamp a legislative chamber held by the Democrats since 1949. Though the Reagan era had been conservative, no one in America had experienced an outright House Republican majority for forty-six years.

Gingrich was an intellectual, as were some of his colleagues. When he first was elected in 1978 as part of what was known as the “New Right,” every young Republican candidate was obsessively reading Robert Bork’s The Antitrust Paradox. In 1995, his goal wasn’t just to pass legislation, but to fundamentally re-gear Congress so it could no longer serve as the brains for the Democratic Party, as it had for the last half century. That was an institutional task, and he set about restructuring the institutions.

The National Design Studio, staffed by Doge veterans, installed visitor-tracking software on vital federal websites.

An opaque White House office staffed largely by veterans of Elon Musk’s “department of government efficiency” (Doge) has quietly rebuilt some of the federal government’s most sensitive websites – for passport applications, voter registration, prescription-drug pricing and children’s savings – in ways critics say appear to violate federal law.

The National Design Studio (NDS) was established by a Donald Trump executive order last August, and is led by Trump-aligned Airbnb co-founder Joe Gebbia and staffed by Doge veterans.

A Guardian investigation has found the office has apparently been developing or redeveloping sensitive federal websites, including those connecting Americans with prescription drugs, children’s savings accounts, passports and voter registration. The investigation corroborates and advances earlier reporting by the Drey Dossier, a YouTube investigative outlet.

The KIDS Act, ostensibly aimed at protecting children, will raise the risk for journalists, dissidents, and whistleblowers.

Democrats and Republicans in Congress have struck a deal on a bill they say will help keep children and teens safe online. The KIDS Act could pass on the House floor as soon as next week; if enacted, it would fundamentally change the way everyone — not just kids — accesses the internet.

At stake is your ability to use many social media platforms without revealing your identity. 

Industry lobbyists have swarmed the Golden State to block new anti-monopoly reforms ahead of a vote this week.

ilicon Valley and other powerful industries have spent millions of dollars to defeat a landmark bill in California that would expand state regulations against monopolies and threaten common business practices of numerous tech giants. The Lever has uncovered that lawmakers who may cast the deciding votes on the legislation in committee have taken thousands in campaign donations from deep-pocketed corporate interests. 

From social media giants Facebook and Google to ridesharing apps like Uber, Big Tech has grown its businesses by resorting to a variety of tactics that skirt antitrust laws, such as anti-competitive mergers and acquisitions, price gouging, and pricing discrimination. Only in recent years have these firms' practices started to face legal scrutiny from federal and state regulators, including a spate of lawsuits to break up Big Tech.

Under current law, California regulators can prosecute antitrust cases only when at least two companies collude to restrain fair competition. The new legislation, now facing a crucial June 30 vote in the Judiciary Committee, would allow the state, for the first time, to begin cracking down on single firm monopolies — when one company dominates a certain industry or uses its large status to unfairly drive out competition.

The City of Memphis’ Smart Memphis Fiber project represents one of the most innovative and consequential municipal broadband initiatives in the United States. Through a creative public-private partnership model that was approved by the City in 2024, Memphis has secured citywide fiber competition (meaning residents will have more than one high-speed internet provider to choose from) and a commitment to delivering fiber service to low-income neighborhoods. In doing so, Memphis has positioned itself to become one of the most fiber-connected cities in America.

What makes Memphis’ success so remarkable is the context in which it was achieved. Memphis is a city where economic challenges are real and persistent. Yet City leaders recognized that accepting the status quo—where fiber investment flows only to areas with the highest disposable incomes—would perpetuate the challenges.

Microsoft is preparing another round of layoffs, spanning Xbox, sales and consulting, as it holds down operating costs while pouring more than $100 billion into AI infrastructure.

The Lifeline program helps low-income families stay connected. So, of course, the Trump FCC hates it.

When the sordid history of Brendan Carr’s FCC is written, you can be sure it will include the boldface names — the fights picked with Jimmy Kimmel and The View, his pressure on 60 Minutes and his cartoon avatar drowning in used kitty litter. They’ll note his sycophantic performances for Donald Trump and Elon Musk and his right-wing podcast rants.

But the rot and damage go much deeper: obliterating the agency’s independence, launching racist attacks on diversity programs, unconstitutional government censorship, and waiving through merger after merger. In Carr’s latest pitiless scheme, he’s making it even harder for the poorest among us to access basic communications.

In our news wrap Monday, the Supreme Court ruled that constitutional privacy protections apply to cellphone location data, the San Francisco Archdiocese agreed to pay $395 million to sexual abuse survivors.

The justices ruled today that constitutional privacy protections apply to cell phone location data. At issue was the police use of what's known as geofence warrants to locate all devices near the scene of a crime back in 2019. The court ruled that, even when location information is shared with companies like Google and Apple, people don't forfeit their expectations of privacy.

The case was widely viewed as a test for how privacy would be protected in this digital age.

The country is dependent on the global giants that call Dublin home. Irish ministers can’t be trusted to chair vital European digital sovereignty talks, says Irish civil liberties campaigner Johnny Ryan.

On the face of it, Ireland behaves like a good European by being a staunch advocate of human rights and a beacon of progressivism on the western edge of the continent. But there is one vital area in which its record is less than perfect – one that should cause concern when the Irish government takes over the rotating six-month presidency of the EU on 1 July. The EU’s tech and AI rulebook will be renegotiated during the same period, but the Irish state and economy have been captured by big tech. Ireland is so compromised that as president of the Council of the EU, it should recuse itself from all tech and digital sovereignty negotiations.

The last time Ireland held the EU presidency was in 2013, during negotiations on the General Data Protection Regulation (GDPR). A leaked Facebook memo describes a 2013 meeting where the company’s executives met Ireland’s then prime minister to complain about the proposed data privacy rules. They left understanding they had Enda Kenny’s assurance that Ireland would use its “significant influence” as EU Council president to deliver what Facebook called a “positive outcome”. The executives also attended “a dinner hosted by senior Irish politicians to work through the various ways that the Irish could be helpful”.

A conversation with Alisa Valentin, broadband policy director at Public Knowledge, and Claudia Ruiz, senior civil rights policy advisor at UnidosUS.

Access to affordable, reliable high-speed internet is a prerequisite for nearly every part of modern life, from finding work and finishing schoolwork to seeing a doctor or staying in touch with family. Yet millions of American households remain stranded on the wrong side of the digital divide.

That's the starting point for "The Blueprint for Equitable Digital Participation," a report released in May from Public Knowledge, UnidosUS, and the National Digital Inclusion Alliance. Rather than beginning in Washington policy circles, this report centers the lived experiences of low- and moderate-income households to find out what's actually standing in their way and what should be done about it.

Carr cites screen time concerns, is accused of trying to be "the nation’s parent."

The Federal Communications Commission was roundly criticized today for proposing to scale back or eliminate E-Rate, a $2 billion-a-year Universal Service program that provides discounts for telecom services and equipment in schools and libraries.

FCC Chairman Brendan Carr said E-Rate should be changed because students are getting too much screen time. He led a 2-1 vote to issue a Notice of Proposed Rulemaking (NPRM) that proposes changes and asks the public to comment on them.

Restrictions on single-firm conduct would allow individual would-be monopolists to be sued under state law. That would include Silicon Valley–based tech firms like Google, Apple, and Meta.

A bill to update the antitrust laws in the nation’s most populous state faces a critical legislative hearing this week. At a time when California is among the states being relied upon as a substitute for proper antitrust enforcement, which is moribund at the federal level thanks to Trump administration corruption, advocates say the state must have a full suite of tools to succeed.

Monied interests are working diligently to stop the bill, but it gained important momentum late last week when a key senator signed on. The office of state Sen. Ben Allen, who is running for statewide office to become California’s insurance commissioner, told the Prospect that “the Senator is very likely going to be supporting the bill.” Allen was one of a handful of Senate Judiciary Committee Democrats whose position on the bill was uncertain as of last week.

Digital Equity Grant Lawsuit Update.

In April, a D.C. federal judge declined to pause litigation over the Administration's cancellation of the $2.75 billion Digital Equity grants aimed at increasing digital literacy and digital skill training. The suit was filed by the National Digital Inclusion Alliance. The Court found that the case covered distinct issues from the related Climate United Fund v. Citibank case and should proceed on its own merits.

A month ago, the administration asked the Court to dismiss the case. However, a DOJ attorney told the Court last week that the government would withdraw from the case and let the grants proceed if all preferences for race are removed from the grant rules...

Daniel Sanchez Estrada’s 30-year sentence for moving a box of pamphlets is likely just the start for criminalizing possession of information.

The Trump administration attacking the right to publish or report information is a given at this point. The president has threatened journalists for everything from questioning the wisdom of his failed war with Iran to touching the peeled lining of his renovated reflecting pool. 

Tantrums like those may now feel routine, but this week marked a new front in Trump’s war on information: Daniel “Des” Sanchez Estrada was sentenced to 30 years in federal prison for transporting a box of zines he didn’t even write. He’s one of eight defendants sentenced on Tuesday to a combined 450 years — the first prison sentences against so-called “antifa” handed down under the framework of NSPM-7, President Donald Trump’s sweeping “counterterrorism” memorandum to clamp down on dissent from the left.