As big tech companies race to build new data centers, load growth that had been largely stable for decades is being upended by gigawatt-scale interconnection requests. While owners and regulators work to clear the backlog of large loads and ensure reliable, affordable power, price-sensitive customers may still feel caught in a bind.

Those familiar with the "streaming wars" may notice the parallels.

Just as traditional media companies were caught off guard by tech company rivals and the rise of streaming, today's utilities are facing a wave of change driven by hyperscalers and artificial intelligence. This pattern offers a cautionary tale: when new entrants disrupt systems built for a different era, they can bring stress, complexity, and rising costs to customers.

Utilities can avoid the disjointed outcomes and customer backlash seen during the streaming wars, but only if they treat the AI boom as a system-wide modernization challenge rather than a backlog of individual projects.

Lessons from the streaming disruption

Netflix's launch of its streaming platform in the early 2000s marked a turning point for the media industry. At the time, binge-watching and on-demand content were unfamiliar to people, but they quickly captured consumer attention and reshaped expectations. Incumbents in the industry—major studios and cable providers—were slow to adapt. During this lag, tech companies captured market share and set a new pace, with Amazon launching what would become Prime Video and Google acquiring YouTube.

By the early 2010s, traditional content giants like Disney, NBCUniversal, and Warner Bros. launched their own direct-to-consumer platforms. Rather than creating a seamless experience, they each went their own way, leading to costly duplication. Every company built its own app, licensing strategy, and subscription model.

As competition intensified, consumer dissatisfaction grew. Monthly costs rose, content became fragmented across platforms, and streaming's simple promise gave way to complexity and fatigue. Eager to win back users lost to market fragmentation, companies began a wave of consolidation and bundling, including Paramount's recent bid for Warner Bros.

When innovation outpaces coordination, systems become disjointed, costs are passed on to end users, and trust erodes. For utilities facing a new era of AI-driven demand, the message is clear: coordination beats catch-up.

Preventing cost shifts to customers

A major concern is that the pace and structure of data center growth could leave utility customers footing the bill without a clear voice in how the system evolves.

According to a recent forecast by 451 Research, part of S&P Global, the grid power required by data centers will nearly triple by 2030, highlighting the speed of this demand expansion. When grid upgrades are rushed to serve individual projects, they can reshape transmission plans, resource portfolios, and local infrastructure, with impacts rippling across the entire service area.

Regulators are also struggling to balance economic development, grid reliability, and ratepayer protection. Policy discussions around interconnection reform, cost allocation, and data center siting are moving quickly, but coordination across states and regions does not always keep pace. Without a more intentional framework, utilities risk repeating the media industry's mistakes: disjointed solutions, uneven benefits, and growing public discontent.

It is this coordination challenge that is driving the acceleration of regulatory reform.

The Federal Energy Regulatory Commission's (FERC) Order No. 2023 requires transmission providers to use a "first-ready, first-served" cluster study process for large generator interconnection requests, which has partly alleviated the backlog of new supply. Similar structures are now being considered for large loads, especially those co-located with on-site generation. If implemented properly, such reforms can address the lengthy study processes for these facilities and may partially resolve cost allocation issues.

What utility leaders can do now

The question facing utilities is how to shape the AI and data center boom into a resilient and equitable part of the nation's grid future. Those that treat these requests as isolated transactions may miss the opportunity to strengthen long-term planning assumptions.

The following steps are critical:

  • Treat AI and data center loads as long-term planning signals, not one-off opportunities. Integrate these projects into resource plans, transmission studies, and distribution system planning from the start to support more durable investment decisions and clearer regulatory conversations.
  • Establish transparent, predictable frameworks for interconnection and cost allocation. Utilities and grid operators must work with regulators and policymakers to modernize interconnection queues, clarify who pays for which upgrades, and ensure costs align with benefits for large customers as well as residential and small business ratepayers.
  • Elevate collaboration to a core competency. Unlike the media industry, utilities already operate within a culture of risk management and public oversight. This should be an advantage. Proactively convening tech companies, regulators, local governments, and community stakeholders can reveal siting options and portfolio solutions that reduce overall system risk.
  • Connect every large load to the broader grid modernization narrative. Each new data center should be evaluated not only for its megawatts but also for how it accelerates transmission, distribution, and resource investments that will serve customers for the long term. Viewing projects as part of connecting today and tomorrow helps link immediate opportunities to long-term system resilience and flexibility.

Avoiding backlash

The streaming wars showed what happens when an industry lets innovation outpace coordination. Media companies are still finding ways to rebundle content and rebalance business models after years of consumer confusion and eroded trust. For utilities, the lesson echoes loudly: when an industry fails to anticipate systemic shifts, reactive consolidation becomes the only path to stability.

Of course, building coordinated, future-ready infrastructure now is better than dealing with high-stakes rework later. But it is not easy. Utilities have little room for error. Outages, bill volatility, or perceived favoritism toward large customers can quickly erode public and political support for critical investments.

The AI and data center boom will shape load growth and grid investment for decades to come. Utilities that meet this moment with coordinated planning, clear communication, and systems thinking can turn disruption into a modernization milestone. Those that treat each interconnection as a one-off transaction may find—like the media giants before them—that reacting too late is far more painful than getting the model right from the start.