The ongoing massive AI build out was supposed to fiberize the rural America in what was, up until now, an oft-cited salient point in favor of the said build out. Well, some hyperscalers are now apparently trying to block fiber network splicing to connect rural towns, fearing vulnerability to network failures.

The ongoing AI-related build out is already encountering a massive pushback from local communities, who fear utility price hikes and a rampant water shortage. Against this morose backdrop, the prudent strategy for hyperscalers should be to try to offer ancillary benefits to such communities, as is being done by SpaceXAI, which is now offering discounts of as much as 50 percent on Starlink plans along with free hardware rentals for eligible residents living near its Colossus AI data centers in Memphis, Tennessee, and Southaven, Mississippi.

Some hyperscalers, however, are apparently refusing to read the proverbial room, and instituting clauses within their contracts with fiber network operators, precluding any fiber off-ramp to rural towns that lie on the route.

What's more, some hyperscalers are also prohibiting their contractors from installing shadow conduits that could eventually fiberize underserved communities, as per the reporting by Fierce Network and the anecdotal evidence it gathered at this week's Mountain Connect event in Denver.

Apparently, hyperscalers are fearful of introducing too many network splices that then become potential nodes of network failure. Do note, however, that Zayo, which is currently adding over 8,000 miles of new optic fiber cables and where NVIDIA is the anchor tenant, has vehemently denied the existence of such a contract clause, going on to note that it actively searches for just such opportunities to fiberize rural towns and communities.

Meanwhile, we reported recently that NVIDIA was "buying up long-haul dark fiber all over the United States - with fiber counts ranging up to 100 pairs ," as per a note from Wolfe Research. Assuming a data transmission speed of 800 Gbps, a DWDM that splits a single shard of fiber into 96 channels, and up to 100 fiber pairs, the total capacity of NVIDIA's dark fiber network scales to 7.68 million Gigabits/second or 7.6 Petabits/second!

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