The US believes a 10x increase in training compute will make its proprietary models 'twice as capable.' This widening performance gap is a strategic lever intended to make aligning with the American AI stack an unavoidable choice for nations seeking competitive advantages, forcing them to overlook sovereignty concerns.

To avoid being cut off from frontier AI, non-US countries can offer US hyperscalers incentives like subsidized energy for building data centers locally. In return, they can demand contractual guarantees for frontier model access, creating leverage against future US government-imposed restrictions.

While data residency is a concern, political resistance and energy shortages may slow data center construction in the US and Europe. This could force Western AI companies to utilize the massive, rapidly-built capacity in places like the UAE, making the region a critical AI infrastructure hub.

Escalating compute requirements for frontier models are creating a new market dynamic where access to the best AI becomes restricted and expensive. This shifts power to the labs that control these models, creating a "seller's market" where they act as "kingmakers," granting massive competitive advantages to the highest corporate bidders.

Beyond simple security concerns, the US government is poised to use its control over frontier AI model deployment to pursue broader strategic interests. Access could be withheld from allies to gain leverage in unrelated negotiations, such as trade deals, turning AI into a tool of foreign policy.

Reid Hoffman advises Europe against trying to replicate US hyperscalers. Instead, governments should offer streamlined access to energy and data center permits to US tech giants in exchange for compute resources, enabling European companies to build competitive AI applications.

The abstract race for AI superiority is now grounded in physical reality. Control over electricity grids, cooling, and land for data centers has become as strategically important as semiconductor supply chains, shaping who can scale frontier AI.

The U.S. faces significant challenges in permitting and energy infrastructure for large-scale AI data centers. Gulf states like the UAE offer regulatory arbitrage, vast energy resources, and the ability to build at "Chinese rates," making them critical partners for deploying the American AI stack quickly.

Instead of competing on model development, middle powers can secure a vital role by dominating physical bottlenecks in the AI supply chain, such as advanced manufacturing, robotics, or pharmaceutical production. This creates a mutual dependency with AI leaders like the US, ensuring their participation in the future economy.