Choo Choo GPU: An AV Big Idea

The Magician’s New Rod

In 1827 the first track of railroads were installed in the United States– 13 miles from the Baltimore and Ohio (B&O) railroads. At the time, the anticipated scope of disruption was limited– people thought that the Erie Canal would face some competition. And it was understood that it would be critical for American development– for example, the dedication stone on the railroad was placed by Charles Carroll of Carrollton, a signatory of the Declaration of Independence.

But no one could have imagined the extent of the disruption railroad infrastructure would catalyze. Industrial revolution, westward expansion, modern agriculture and food distribution– all came about as the result of rail. In 1844, Ralph Waldo Emerson captured the criticality of rail: “railroad iron is a magician’s rod in its power to evoke the sleeping energies of land and water.”

It is fair to say: without railroads, we would not have an America.

Now, a new “magician’s rod” has emerged, unleashing sleeping markets with untapped possibility. Except this marvel is not made of iron, it is made of concrete: data centers. And this rod unleashes not the energies of rail and the physical world, but the energies of AI and the digital.

What lessons can we learn from the railroads about data centers? In this blog, we look at rail “then” and data centers “now” to extract some learnings.

The New Railroad Revolution

Massive Infrastructure Investment: Building the Backbone

Railroads Then: The 19th and early 20th-century railroad construction was a monumental infrastructure project that connected disparate regions, facilitating trade, mobility, and economic integration. Between 1830 and 1850, U.S. railroads grew from 13 miles to 9,000 miles of track, then expanded dramatically during the “golden age” of rail, reaching 100,000 miles by 1881 and peaking at 254,000 miles in 1916—all while employing 1.8 million people and serving as America’s largest industry. While it took a century or so to build, the massive infrastructure investment became the backbone of the industrial economy.

AI Data Centers Now: In 1946, ENIAC—a 27-ton computer occupying 300 square feet at the University of Pennsylvania—became the first data center, calculating artillery tables for the U.S. military. Today, over 5,300 data centers span the United States, forming the foundation of modern computing and the emerging AI economy. McKinsey too forecasts the U.S. data center demand 10 percent annual growth a year until 2030:

New Economic Terrain: Digital Tracks of AI Data Centers

Data centers are reshaping the economy today, much as railroads once did. Both infrastructures reduced distances: railroads cut miles, while data centers shrink digital gaps, turning seconds into microseconds in every transaction and interaction.

Railroads Then: Railroads didn’t just transport goods; they created economic hubs, connected industries, and standardized time zones. Faster travel cut costs, boosted productivity, and ultimately connected a growing nation in real-time. By syncing schedules, railroads didn’t just transform commerce—they changed how people experienced time and distance.

Data Centers Now: Data centers drive the digital economy, reducing “digital distance” and cutting out lags that impact our online interactions. They enable vast AI applications across industries, making everything from remote work to AI-driven research faster and more efficient. They create digital hubs for global collaboration, new business models, and rapid innovation cycles, all while syncing our online and offline lives in ways that echo the railroads’ impact.

The Competition for Control: A Digital Land Grab

The expansion of the railroads was a free-for-all until the biggest players emerged to dominate. Data centers are experiencing the same clash—tech giants laying down their own tracks, customizing GPUs, and setting the standards for the infrastructure they’ll control.

Railroads Then: Companies raced to lay parallel tracks, often redundant, in their quest to dominate routes. Eventually, consolidation became inevitable, and the rails were standardized, with the big players left to call the shots. The rail tycoons didn’t just build a transportation system—they built economic empires.

Data Centers Now: Today, data center titans are racing to control the infrastructure that powers AI. It’s custom GPUs, open-source frameworks, and design standards driving the digital frontier. Consolidation is accelerating as larger companies buy up specialized startups and streamline processes. Like railroads, the path toward efficiency is reshaping the industry, with a few powerful companies positioning themselves to dictate the rules of AI infrastructure.

Geopolitics and National Security: Digital Frontiers in a New Era of Power

Just as railroads once determined a nation’s economic power, data centers now sit at the heart of global influence. Countries are keenly aware that data infrastructure is the foundation upon which economic dominance, security, and even sovereignty will rest.

Railroads Then: Railroads weren’t just about commerce; they were national assets, crucial for mobilizing troops, transporting goods in times of war, and securing supply chains. A strong railroad network meant a strong nation, both economically and strategically. Countries that lagged behind in rail development often fell behind in global power and influence.

Data Centers Now: Today, data centers are the new critical infrastructure, central to national security. They power AI-driven defense systems, manage vast amounts of sensitive information, and support cybersecurity defenses. Nations are investing heavily in these assets as part of their broader defense strategies. Data centers are no longer neutral—they’re targets in cyber warfare, assets in global competition, and linchpins in securing economic independence.

Governments around the world, from the United States to China, recognize that whoever controls data center infrastructure wields influence over the AI-driven future. This isn’t just about owning the technology; it’s about protecting it. We’re seeing countries mandate that data centers be built on home soil, guardrails go up around data flows, and policies put in place to protect critical data assets. These facilities don’t just store data—they store a country’s future.

Investment Risks and Opportunities

Key considerations for investors include:

Key Players Shaping the Future

The landscape is dominated by established tech giants and innovative startups:

Future Outlook and Legacy

AI data centers will likely have lasting impacts similar to railroads, driving:

Conclusion

AI data centers are our era’s railroads, laying down the digital tracks for a new economy, new industries, and new power dynamics. Just as railroads reshaped commerce, society, and geopolitics, today’s data centers are transforming the digital landscape, one millisecond at a time. This is more than tech infrastructure; it’s the backbone of a future built by those bold enough to envision it.

For investors, the stakes are clear: bet on the innovators laying this foundation, not just for growth but for legacy. The real pioneers of the AI age won’t just witness change—they’ll drive it, building an economy as unstoppable as a locomotive. The future is here, and it’s running on data.

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