Defence goes digital – data centres and AI on the frontline of national security
key takeaways.
- Artificial intelligence is playing a growing role in the defence sector. With commercial firms at the forefront of AI development, the lines between the public and private sectors are blurring
- Cybersecurity is being transformed, with AI handing new weapons to both attackers and defenders – the market for AI in cybersecurity is forecast to grow by almost 25% annually until 2033
- As the home of AI, data centres are the physical manifestation of this digital battleground, putting them on the frontline of national security
- The world’s biggest powers are investing heavily to achieve digital sovereignty, stoking a global race for AI and data centre capacity dominance
- Semiconductors and critical materials supply chains have become a chokepoint – new international alliances are emerging in response.
As nations rush to upgrade their digital defences, critical AI infrastructure is emerging as the new frontline, driving investment in cybersecurity and data centres.
Cybersecurity – digital defence in a realm without borders
AI and digital technology – the new national security paradigm
The battle for data centre dominance
Semiconductors and critical minerals – ‘friendshoring’ to secure supply
Data centres – from frontline to final frontier
1 Eligible Receiver 97: Seminal DOD Cyber Exercise Included Mock Terror Strikes and Hostage Simulations | National Security Archive; Eligible Receiver 97, Part II: The Final Observation Report | National Security Archive; Four Days in June: Eligible Receiver and the Start of the Cybersecurity Industry | 2017-10-09 | Security Magazine
2 Anthropic test found vulnerabilities in classified US systems in hours | AP News
3 Chinese Surveillance Cameras Have Become a Huge Problem for India – The Diplomat; Govt. Orders Nationwide CCTV Audit After Ghaziabad Spy Bust
4 From the Editor-in-Chief - India Today; India's alarm over Chinese spying rocks the surveillance industry | Reuters; Govt. Orders Nationwide CCTV Audit After Ghaziabad Spy Bust
5 OpenAI's models secretly joined forces months ahead of hacking Hugging Face | Tech News - Business Standard; An OpenAI test model escaped and broke into a real company’s servers | CNN Business
6 AI Cyber Challenge marks pivotal inflection point for cyber defense | DARPA; ARPA-H & DARPA challenge showcases AI’s power to secure America’s health care | ARPA-H; DARPA unveils winners of AI challenge to boost critical infrastructure cybersecurity - Nextgov/FCW
7 Gartner Forecasts Worldwide End-User Spending on Information Security to Total $213 Billion in 2025
8 AI in Cybersecurity Market Size & Share Report, 2026-2033
9 AI Warfare Becomes Real for US Military With Project Maven
10 Algorithmic Warfare Cross-Functional Team (AWCFT) / Project Maven
11 How AI Is Redefining Defense and Modern Warfare
12 Militarizing AI: How to Catch the Digital Dragon? - Centre for International Governance Innovation
13 US defense department awards contracts to Google, Musk's xAI | Reuters
14 Announcing The Stargate Project | OpenAI; OpenAI first data center in $500 billion Stargate project up in Texas
15 OpenAI Stargate: where the US sites stand | Epoch AI
16 [implied base of roughly 45 GW in 2025] – US Data Center Power Demand Projected to Double by 2027 | Goldman Sachs
17 EU launches InvestAI initiative to mobilise €200 billion (original announcement); EU launches AI Gigafactories call to boost Europe's computing capacity (updated announcement); AI Gigafactories - European Commission
18 China Plans $295 Billion Investment to Build Nationwide AI Data Centers - Bloomberg
19 Nvidia to focus on competition-beating AI advances at megaconference | Reuters
20 Taiwan’s Role in Global Semiconductor Supply Chains | Congress.gov | Library of Congress
21 ASML: The World's Most Complex Lithography Machine; Any reference to a specific company or security does not constitute a recommendation to buy, sell, hold or directly invest in the company or securities.
22 With new export controls on critical minerals, supply concentration risks become reality – Analysis - IEA
23 Ibid
24 EU and US launch strategic partnership on critical minerals; Australia and EU seal trade deal, seek to cut reliance on China for critical minerals | Reuters
25 Breaking China's Rare Earth Dominance Could Take a Decade: Goldman - Business Insider
26 Defence investment and NATO’s 5% commitment | NATO Topic
27 ReArm Europe Plan/Readiness 2030
28 McKinsey & Company, The infrastructure moment, September 2025
29 Gartner Says Data Center Electricity Consumption to Grow 26% in 2026
30 Are SpaceX's space data centers realistic?; SpaceX aims to launch orbital AI computing tests by end of next year, sources say | Reuters
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