This week I put a call out on our Instagram to find out what stories you lovely people want investigated and explained. There were sooooo many responses (THANK YOU!), but one topic came up more than any other: AI data centres.

It was interesting timing, because at that very moment, a group of Australian musicians, artists and creatives were gathering on Parliament lawn to fight for Australia's copyright laws in light of ongoing AI expansion.

So today I'm getting to the bottom of why the Government is courting the world's biggest tech companies, what it means for our creative industries, and whether we should all be...concerned.

It's a long one, but a juicy one. Let's lock in.

To understand this whole kerfuffle we need to start with the basics: wtf is a data centre?

Data centres are massive buildings filled with supercomputers designed to handle the processing, storage and cooling demands of artificial intelligence. When you ask ChatGPT a question or use basically any app these days, that request shoots off to a data centre for processing before making its way back to you.

So why are they so controversial?

The main issue is environmental. The hardware inside these centres runs incredibly hot, and an enormous amount of water is required to keep them cool. There's also a community angle.

The data centres have to go somewhere, and right now they're headed for Western Sydney. More than $21 billion worth of projects are currently awaiting approval in the region alone. Research shows they can raise surrounding land temperatures by up to two degrees Celsius, in a part of the city where urban heat is already a serious problem.

By 2030, data centre energy demand on Australia's east coast grid is expected to triple, equivalent to powering every home in Victoria.

You might be thinking: that all sounds pretty grim. Why is the Government approving all these plans?

Australia is heading into one of the biggest foreign investment booms in its history.

In the past year alone, OpenAI (the company behind ChatGPT) has committed $7 billion to build data centres in Western Sydney. Amazon Web Services has pledged $20 billion. Microsoft has announced $25 billion, its largest ever investment in Australia.

The central argument is straightforward: The AI economy is reliant on data centres, the same way roads and ports were the backbone of the industrial revolution. Without them, Australia has to rely on overseas players.

By striking deals early, the Government also gets to set its own terms, asking companies to fund renewable energy, invest in local research and create local jobs.

On paper, it's a compelling case. But Independent ACT Senator David Pocock has questioned what price Australians will be forced to pay for this investment.

During question time last week, he asked the Government about alleged secret submissions that had been made to cabinet, suggesting the Government was considering rolling back its copyright protections in exchange for investment in data centres.

It’s a proposal that would, hypothetically, give AI companies access to Australian creative work without payment or permission.

In October last year, the Government ruled out a proposed change to the Copyright Act that would have allowed AI companies to use Aussie content (songs, books, films, etc.) to train their models. Artists celebrated it as a win.

Then this week, Pocock alleged this decision could be reversed. The Government has denied this, but it hasn’t assuaged concerns. It's also been widely reported that copyright was raised directly in discussions between Anthropic (the company behind Claude) and Australian data centre operators.

Musicians, writers and performers were sufficiently spooked. The peak bodies of pretty much every creative industry congregated on Parliament lawn this week to call on the Albanese Government to uphold copyright law and Australians' right to decide how their work is used by AI companies.

One of the industry organisations leading the charge was the Australian Recording Industry Association (ARIA). CEO Annabelle Herd said changing copyright law would "legalise the theft of Australian creativity and set a precedent felt well beyond our borders."

I spoke to musician Holly Rankin, who performs as Jack River, and has been one of the most vocal advocates on this issue. She said large AI models have already “scraped everything we know and love without permission and without payment."

Rankin is clear about what creatives are actually asking for: not a government-administered compensation fund, but the right “to decide how their work is used by AI, full stop," she said.

To get some clarity, I reached out to Attorney-General Michelle Rowland, who was central to last year’s copyright decision. She confirmed the Government has "no plans to weaken copyright protections when it comes to AI."

But the very idea has clearly struck a nerve.

Last week I wrote a piece for TDA’s Culture newsletter (don’t forget to sign up here) about how AI systems have been trained on protected creative works. It came after U.S. publication The Atlantic launched a searchable database revealing over 21 million songs that have circulated among AI developers without creators’ consent.

Dozens of big name Aussies were caught up in the leaks. Kylie Minogue appears in the database over 1,000 times. Sia 521 times. INXS 234 times. Midnight Oil, Cold Chisel, Tame Impala, Hilltop Hoods, all swept up in what's being described as one of the most significant data heists in music history.

National music rights body APRA AMCOS said Australian and NZ creators stand to lose more than $500 million over four years without a mandatory licensing framework. The average songwriter is already facing a 23% hit to their revenues.

What these creatives are scared of (AI companies profiting from their work without payment or permission) is very much already happening. And so far, seemingly without repercussions.

Rankin says the fight is now playing out in the courts as much as in parliament. There are more than 200 live cases globally, mostly in the U.S, where companies like Universal Music and Warner are suing Anthropic and OpenAI for the illegal scraping of their content.

A U.S. court ruling on whether training AI on copyrighted music is even legal is expected this month, and could reshape the entire industry. Back home, a NSW parliamentary inquiry into data centres reports in September, and the Productivity Commission's final report on AI and copyright lands in December.

But with billions of dollars of investment on the table, the question of who gets to decide how Australian creative work is used by AI is far from settled.

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