The AI boom created a colossal market for compute—GPUs, networking gear and the massive datacenters that run it all. It also bolstered a second less celebrated market: protecting those facilities and the crown-jewel chips inside from threats.

On top of rising anti-data center sentiment stateside, the war in Iran has turned that problem into a line item. “Data centers are secondary targets right after obvious military sites,” says Matt McCrann, former executive at drone defense company DroneShield, who has worked with data centers in the U.S. and Middle East.

That shift matters because the AI data centers being built these days aren’t just expensive—they’re also possible strategic infrastructure during times of war. Enemies don’t need to hit a military site to degrade an opponent’s capability; they can hit compute that potentially underpins communications, logistics, payments and even military planning.

Executives in data center security tell Forbes that reality is driving an increased appetite for more hardened security—especially counter-drone capabilities—both in the Middle East and elsewhere. (The one gigawatt of existing capacity in the Middle East is set to triple via 2.2 GW under construction and another 12 GW in planning stages, per public real estate firm JLL.)

In early March, drone strikes damaged Amazon Web Services data centers in Bahrain and the UAE causing a significant and costly disruption in services. More than a month later, AWS dashboards still showed that services remain “disrupted” from the affected region (though some are now resolved); Amazon refunded March credits for those using them, The Register reported, setting the company back an estimated $150 million. Data centers usually have extensive insurance policies, but almost all of them exclude damage from military conflict, says Tom Harper, data center leader at insurance broker Gallagher. “Typically a policy excludes war. So if it’s an active war, it’s not gonna be covered.”

The threat isn’t just explosive drones. It’s also “loitering” drones which probe wireless networks and map data center layouts looking for weak spots. The practical point is blunt: when U.S. tech companies build such valuable, highly-concentrated compute, it can become a tempting wartime target, and one whose disruption can extend far beyond the immediate blast radius, even if nothing happens on U.S. soil. In early April, Iran’s Revolutionary Guard published a target list that included facilities belonging to Microsoft, Oracle and Amazon—and appeared to threaten Stargate UAE, a $30 billion-plus joint venture between major players including OpenAI, Oracle, SoftBank and Gulf-based investment firm G42 that Trump helped unveil at the White House last year.

AWS’ CEO Matt Garman told Forbes that the industry is “rethinking” cloud security as global conflict accelerates. “The world went through a long period, starting before the Ukraine war, of not really having a lot of conflict between nations. And we see some of that ramping up,” Garman says.

For private company operators and security vendors, the response is clear: a lot more physical security, and more tools to detect, deter and—where regulations allow, and they currently do not in the states—destroy drones.

The more compute you concentrate in one place—especially if that place is close to an active war zone or in a town where fears of AI data centers straining local power grids and sending electricity bills soaring are agitating locals—the more you have to spend to keep it running and safe. That’s a boon for business. Collin Sloan, vice president of strategic partnerships at IronSite, says it’s a second wind for a sector that looked sleepy five years ago. Data centers want more advanced security. Advanced costs more—as much as five percent of construction costs, according to John Bekisz, vice president of consulting firm Guidepost Solutions’ Data Center and Critical Infrastructure Practice.

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JLL, which develops data centers around the world, projected last year that data center shells (land, power and the building, not including GPUs) cost roughly $12 million per megawatt OpenAI’s Sam Altman has said he’ll need a staggering 250 gigawatts of power in eight years; back-of-the-napkin math would bring in up to $150 billion in revenue for data center security firms. That’s a multi-billion-dollar addressable market for access control, surveillance, sensors, fortified walls and threat response—before you even get to drone defense.

Even smaller facilities can rack up large bills just for security hardening. Sloan said fencing, gatehouses, vehicle barriers and related measures can range from $5-20 million. (IronSite counts Amazon as a customer.) McCrann and Eben Frankenberg, CEO of sensor maker Echodyne, say counter-drone systems cost between a couple hundred thousand to the “low millions,” scaling up with facility size and importance. Verkada, which makes cameras and physical security software, including for data centers, surpassed $1 billion in sales last year and sees data centers as “new source of demand,” per CEO Filip Kaliszan.

Legacy players like Honeywell, Allied Universal and Control Risks could benefit from this trend as well. So could a new crop of startups in the space. “Demand is through the roof … if we came out of stealth, we wouldn’t be able to keep up with it,” said one founder of a company that secures data centers and other critical infrastructure. Counter-drone companies, already seeing more requests to protect power plants, petrochemical sites, and airports, are also positioned for some upside.

And there’s plenty of room for new players. “With some of our clients, we are not their exclusive security designer,” says Bekisz. “There's enough work that, frankly, we need to be working together … there’s not a lot of us out there.”

Data center security has historically been focused on ground-based threats. “It’s pretty difficult to thwart something like a [drone] attack,” especially in the United States, Bekisz says.  Adds McCrann: because of the more imminent threat in the Middle East, the regulations are more supportive of private companies’ use of physical countermeasures like jamming or intercepting drones. (In the U.S., only select government agencies can do so.)

That’s changing, thanks to the war in the Middle East and those AWS attacks. Now, more eyes are on the skies. An investor told Forbes that “a lot” of defense companies are building ground-based interceptors for aerial threats that will look to partner with data center companies.

Sloan says interest is surging. “Everyone knows that we’re going to have to deal with drones,” he explained, calling it a “current slash future” issue for U.S. data centers. IronSite is starting to test sensors that could “take down” drones for the first time, he adds.

That shift will likely benefit counter-drone companies like Dedrone (which Axon bought in 2024 at a $500 million valuation); DroneShield (which has nearly quadrupled its market cap in the past year); and Sentrycs (which Ondas bought in November), which are well-positioned for growth. Echodyne, which sells radars to several counter-drone firms, has more than doubled its revenue over the past year.

DroneShield Director of Public Safety Tom Adams and Echodyne’s Frankenberg say they have both received counter-drone inquiries from data center operators in the U.S. and Middle East as a direct result of Iran’s AWS attack. Adams believes that drone defense is now starting to become a must-have for all companies with valuable infrastructure. Like cybersecurity software, it’s becoming a standard budget line.

There’s “additional anxiety after what happened to the AWS site in the Middle East, but also just general concern about drones,” says Frankenberg.

If the war in the Middle East stretches on, some working in AI infrastructure worry the conflict may scare hyperscalers like Microsoft and Amazon away from putting additional data centers in the region. But other sources in the industry told Forbes they haven’t seen signs of project cancellations or cold feet about investing additional resources into building data centers in the Gulf.

Still, everyone’s aware of the risks. And they’re starting to get baked into data center security costs, but also insurance costs. Bilal Abu-Ghazaleh, founder of Dubai- and London-based AI infrastructure startup 1001, there’s been a “mindset shift” in the region from focusing on operational efficiency to risk management and defense. “How do we protect this? How do we have contingencies? How do we know everything that’s going on with the risks?”

Rich Nieva contributed reporting.

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