How Trump’s AI Executive Orders Are Impacting Software Development in the US

What does the future of AI in the U.S. look like for businesses today? Well, recent executive orders from former President Donald Trump have set the stage for some big changes, especially for companies developing software and AI solutions.

Three orders signed this past July address data center construction, global AI exports, and federal procurement standards. For a software company or those managing technology decisions, these changes might affect the bottom line in ways you might not expect.

The orders target three critical areas: speeding up data center construction through streamlined federal permitting, pushing American AI technology into global markets, and requiring federal agencies to purchase only what the administration calls “unbiased” AI systems.

For software developers and business leaders alike, understanding these policy shifts matters now more than ever as the government’s purchasing power begins influencing industry standards across the board.

Key Insights:

• Federal AI contracts now require neutrality standards, but the exact definition isn’t clear until the OMB provides guidance. If you sell to the government, you’ll face new compliance requirements without clear technical details. This creates uncertainty until at least late 2025.
• The infrastructure benefits mainly favor large companies with $500 million+ projects, which can get faster approvals and federal funding. Most software companies use cloud providers instead of building their own data centers, so any improvements you see will be indirect and unclear in timing. Startups will see limited direct benefits from these changes.
• The export program requires full AI technology packages, not just software. You’ll need a complete solution that includes hardware, security, and applications, or partner with other companies to offer a full package. This makes it harder for mid-sized companies to compete internationally.
• Timelines for implementation will likely be longer than expected due to agency constraints and legal challenges. Environmental groups are planning to challenge the faster permitting process, while agencies must add new review steps without extra funding or staff.
• The neutrality standards are subjective and could be interpreted differently by various agencies. Your AI model might pass one department’s review but fail another’s due to the lack of clear technical guidelines. This uncertainty forces businesses to play it safe, which could limit the capabilities of their products.

Trump AI Executive Policy: A Detailed Overview

Since returning to the office in January 2025, President Trump has moved quickly to reshape federal AI policy. His administration rescinded the Biden-era executive orders (Executive Order 14110) and introduced a new framework built around three priorities:

Removing what it calls ideological constraints from AI systems, cutting regulatory barriers to infrastructure development, and positioning American AI technology as the global standard.

Redefining Federal AI Procurement Standards

The administration wants federal agencies to buy AI systems that meet specific neutrality criteria. Under an executive order signed in July, all government purchases of large language models must now comply with two principles: truth-seeking and ideological neutrality.

What this means in practice:

• AI models used by federal agencies cannot generate outputs influenced by diversity, equity, and inclusion frameworks unless a user explicitly requests that perspective.
• Vendors must demonstrate their systems prioritize factual accuracy and avoid what the administration characterizes as partisan outputs.
• Existing federal contracts with AI providers will need amendments to include these compliance requirements.
• Agencies must factor in potential costs for replacing systems if vendors fail to meet the standards.

The Office of Management and Budget has 120 days from the July signing to issue detailed implementation guidance. For software companies selling to the government, this creates a new compliance threshold to meet.

Accelerating Infrastructure Development

Building AI data centers currently involves navigating environmental reviews, federal permitting processes, and energy infrastructure approvals. The administration aims to compress those timelines significantly.

The infrastructure executive order establishes several mechanisms:

• Projects with at least $500 million in capital investment or 100 megawatts of additional electrical load qualify for expedited federal support.
• The Commerce Department can now offer loans, grants, tax incentives, and purchase agreements to eligible projects.
• Environmental reviews get streamlined through new categorical exclusions under the National Environmental Policy Act.
• Federal agencies must identify brownfield and Superfund sites suitable for data center development by January 2026.
• The Department of Interior and Department of Energy will designate federal lands available for AI infrastructure.

Energy remains a central concern. The policy emphasizes nuclear, geothermal, and natural gas power sources to support data center operations, with limited mention of renewable alternatives.

Expanding American AI Exports

The third executive order creates the American AI Exports Program, designed to help U.S. companies sell complete AI technology packages to allied nations. By October 2025, the Commerce Department must establish a formal selection process for industry proposals.

Companies participating in the program need to submit comprehensive packages covering:

• AI hardware infrastructure, including where components are manufactured
• Data processing and labeling systems
• AI models and applications for specific use cases like healthcare, education, or transportation
• Security measures for protecting AI systems
• Target countries or regions for deployment
• Business models explaining who will build, own, and operate the infrastructure
• Requested federal support or incentives

Selected proposals become “priority AI export packages” backed by federal financing tools, including loans, equity investments, and technical assistance. The State Department leads diplomatic efforts to help partner countries establish favorable conditions for adopting American AI systems.

The goal is straightforward: expand U.S. market share while reducing global dependence on AI technology from adversarial nations, particularly China.

Immigration and Intellectual Property Adjustments

Two policy areas affecting software development received notable changes, though through separate administrative actions rather than the July executive orders.

New H1B visa regulations implemented in October introduce higher fees and a wage-based selection system. The administration frames this as prioritizing highly skilled workers. Industry groups have raised concerns about potential impacts on smaller companies competing for international talent.

On intellectual property, the administration has signaled a more permissive stance toward AI companies using copyrighted material for model training.

This “common sense” approach, as officials describe it, suggests less immediate concern about copyright infringement claims. That position differs sharply from media companies and publishers seeking stronger protections.

Military and Workforce Implications

Beyond the three core executive orders, the broader AI Action Plan addresses defense applications and labor market changes.

The Defense Department receives directives to accelerate AI adoption across military operations, focusing on secure and reliable systems that maintain technological superiority. The plan also calls for workforce development programs to prepare American workers for an AI-influenced economy, though specific implementation details remain limited.

Power grid expansion appears throughout the policy framework as essential infrastructure. Meeting the energy demands of large-scale AI operations requires substantial electrical capacity, which the administration plans to address through a mix of nuclear, geothermal, and fossil fuel sources.

Comparing Biden’s Executive Order on AI vs. Trump’s 2025 Overhaul: A Policy Comparison

The direction of U.S. artificial intelligence policy has undergone a significant transformation with the change in leadership. 

Under President Biden, the focus was on regulation, ensuring that AI systems are safe, transparent, and aligned with ethical standards. 

However, former President Trump’s executive orders in 2025 take a different approach, aiming to accelerate AI development, promote U.S. global leadership, and reduce perceived ideological biases in AI systems.

Below is a comparison of the key differences between Biden’s and Trump’s AI policies:

Policy Aspect	Biden-era Executive Order (2023)	Trump’s Executive Orders (2025)
Overall Strategy	Focus on safety, fairness, and ethical standards in AI.	Focus on deregulation, rapid innovation, and global leadership.
Regulation of AI Models	Emphasized transparency, accountability, and safety.	Removed perceived “ideological bias” in AI, prioritizing ideological neutrality.
AI Ethics & Fairness	AI must adhere to fairness principles, including diversity, equity, and inclusion (DEI).	AI systems must be “truth-seeking” and ideologically neutral, free from DEI-driven agendas.
Federal Procurement of AI	Focused on incorporating ethical guidelines into procurement practices, ensuring AI models do not perpetuate bias.	Requires federal agencies to update contracts with vendors to meet “Unbiased AI Principles.”
Permitting and Infrastructure	Stressed the importance of transparency and public engagement in AI-related infrastructure.	Streamlined permitting for AI infrastructure, including data centers and semiconductor facilities, to accelerate development.
Export Policy	No specific emphasis on boosting exports. Focus on international cooperation.	Promoted the export of U.S.-developed “full-stack” AI technology to allied nations, focusing on countering Chinese influence.
Energy and Workforce Development	Focused on ethical implications of AI on workers and society, including worker protections.	Emphasized energy grid expansion and workforce training to support AI infrastructure growth, with limited focus on ethical labor protections.
AI in National Security	Focused on securing AI systems used in national defense.	Accelerated the adoption of AI in defense to maintain military supremacy.
Environmental Impact	Prioritized environmental safety in AI infrastructure projects.	Reduced environmental review processes, raising concerns about long-term ecological impact.

Key Differences in Policy Approach

• Biden’s Approach: Biden’s executive orders were designed to ensure that AI systems are safe, ethical, and accountable. The primary goal was to protect the public by regulating AI to ensure transparency, fairness, and the prevention of biases. 

These policies focused on addressing societal risks, fostering trust, and creating regulations that balanced innovation with public safety.

• Trump’s Approach: Trump’s 2025 executive orders focus on fostering rapid AI development and establishing U.S. leadership on the global stage. 

His policies streamline regulations, including fast-tracking approvals for AI infrastructure and promoting AI exports to allied nations.

The new rules also target the reduction of perceived ideological biases in AI, especially in federal procurement, requiring neutrality and truth-seeking models.

In summary, while Biden’s policies were centered on regulating AI for fairness and safety, Trump’s policies are geared toward innovation and global competitiveness, with a focus on removing regulatory hurdles and promoting U.S. dominance in the field of AI. 

These changes reflect broader priorities of each administration and have wide-reaching implications for businesses and the broader technology ecosystem.

How These Policies Impact Software Development Operations

The executive orders create three distinct pressure points for software companies: procurement requirements, infrastructure access, and market opportunities.

Federal Contract Compliance Gets More Complex

If you sell AI products to government agencies, you now face additional documentation requirements. The neutrality principles mean demonstrating how your models handle politically sensitive topics.

That’s not a technical specification you can check off easily. It requires ongoing testing, documentation, and potentially redesigning training data or fine-tuning approaches.

Companies with existing federal contracts need to renegotiate terms by the time OMB issues final guidance. Budget for legal review and technical audits. The order specifically mentions “decommissioning costs,” meaning agencies want clarity on what happens if your system fails compliance down the road.

Infrastructure Timelines Improve, With Caveats

Faster permitting helps if you’re building data centers or expanding compute capacity. Projects meeting the $500 million threshold get access to federal financing tools and expedited environmental reviews.

But most software companies don’t build their own data centers. You’re more likely using cloud providers. The benefit here is indirect: if AWS, Google Cloud, or Microsoft Azure can build capacity faster, you eventually see better availability and potentially lower costs. The timeline for that impact remains unclear.

Smaller operations won’t qualify for the expedited treatment. The high capital thresholds favor major infrastructure plays, not startups scaling up compute resources.

Export Opportunities Require Significant Commitment

The export program sounds promising but demands substantial resources. You can’t just apply with an AI model. The requirement is a complete technology stack, from hardware to applications, with detailed business plans and target markets identified.

This favors established companies or consortiums that can bundle capabilities. If you’re a mid-sized software firm with a strong AI product, partnering with hardware providers and system integrators might open doors. Going it alone probably won’t work unless you have comprehensive offerings already.

How Software Companies Can Take Full Advantage of These Executive Orders

The policies create specific opportunities for companies positioned to act quickly on infrastructure, exports, and federal sales.

Position for federal procurement opportunities

• Review your AI systems against the neutrality principles now, before final OMB guidance arrives.
• Document your training data sources, model architecture, and output testing procedures.
• Consider hiring compliance specialists familiar with federal procurement requirements.
• Build relationships with federal agency technology officers to understand their evolving needs.

Explore infrastructure partnerships

• If you need significant compute capacity, investigate whether your expansion plans could qualify as part of a larger infrastructure project.
• Connect with cloud providers planning expedited data center builds to secure early capacity commitments.
• Look into co-location opportunities at sites being fast-tracked under the new permitting rules.

Evaluate export program participation

• Assess whether your technology fits into a full-stack offering for international markets.
• Identify potential consortium partners who provide complementary capabilities (hardware, security, implementation).
• Review export control compliance and ensure your systems meet the strict requirements.
• Target allied nations where U.S. diplomatic efforts are creating favorable regulatory environments.

Consider intellectual property strategies

• The administration’s permissive stance on training data creates room for more aggressive data collection strategies.
• Understand that this position may not survive legal challenges or future policy changes.
• Balance opportunity against reputational risk, especially if you work with media or publishing partners.

Plan for talent acquisition changes

• The new H1B wage-based selection system favors higher-paid positions.
• If you rely on international technical talent, budget for increased visa costs and longer timelines.
• Develop relationships with U.S.-based training programs to build domestic pipeline alternatives.

Policy Limitations and Practical Constraints

These executive orders face implementation challenges, legal questions, and market realities that limit their immediate impact.

The Neutrality Standard Lacks a Clear Definition

What exactly constitutes “ideological bias” in an AI system? The executive order provides principles but not technical specifications. Different agencies may interpret requirements differently. Model developers face subjective compliance criteria that could change based on who’s evaluating the system.

The 120-day timeline for OMB guidance doesn’t guarantee clarity. Early drafts may leave significant gray areas, forcing vendors to make conservative assumptions that limit model capabilities.

Environmental and Legal Challenges Loom

Streamlined permitting doesn’t eliminate environmental law. It creates faster pathways through existing requirements. Environmental groups have already signaled intent to challenge projects they view as inadequately reviewed. Expect litigation that could slow infrastructure development despite the policy changes.

Federal land designations require coordination across multiple agencies with different mandates. The Interior and Energy Departments don’t always align on land use priorities. Getting actual sites approved and available for development will take longer than the executive orders suggest.

Export Controls Create Tensions With Promotion Goals

The administration wants to expand AI exports while tightening controls on sensitive technology going to adversaries. These objectives conflict in practice. Semiconductor export restrictions, compute limitations, and end-user verification requirements all slow international sales.

The full-stack approach also reveals capabilities to foreign buyers, including details about U.S. security implementations. National security agencies may resist certain exports even to allied nations.

Smaller Companies Face Structural Disadvantages

The high thresholds for infrastructure support, complex export program requirements, and increased visa costs all favor larger organizations. If you’re running a startup or mid-size software company, many of these policies offer limited direct benefit.

The federal procurement changes actually increase your compliance burden without providing offsetting advantages. Larger competitors with established government relations teams and legal departments can navigate the new requirements more easily.

Implementation Depends on Agency Capacity

Executive orders direct agencies to act, but they don’t fund additional staff or resources. Many federal agencies already face capacity constraints. Adding new review processes, compliance checks, and program administration competes with existing responsibilities.

Actual timelines for seeing policy effects will likely stretch beyond what the orders specify. Budget cycles, personnel limitations, and bureaucratic inertia all slow implementation regardless of political priorities.

How Codewave is Pioneering Custom Software Development for the Future

The new federal AI policies create compliance challenges and infrastructure demands that many software companies aren’t equipped to handle alone. At Codewave, we have spent the past year helping organizations build AI solutions that balance innovation with practical constraints.

With over 400 applications delivered across 15+ industries, we understand how policy changes translate into technical requirements.

Our approach centers on what we call the 80-20 principle: identifying the 20% of features that deliver 80% of business impact. When federal procurement standards shift or infrastructure timelines compress, you need development partners who can adapt quickly without rebuilding everything.

That’s where our Code Accelerate framework makes a difference. We’ve built pre-tested modules for common AI functionality, letting us focus resources on your unique compliance needs and business logic rather than reinventing standard components.

How we’re helping companies respond to the executive orders:

• Federal compliance readiness: Building documentation systems and testing frameworks that demonstrate AI model neutrality and truth-seeking principles for government contracts
• Rapid deployment cycles: Using agile methodologies to iterate on AI features as OMB guidance and agency requirements evolve
• Export-ready architecture: Designing AI systems with modular security layers and deployment flexibility for international markets
• Cost-effective scaling: Using cloud-agnostic infrastructure that takes advantage of improved data center availability without vendor lock-in
• Talent optimization: Structuring development teams to maximize domestic expertise while strategically using international resources under new H1B constraints

Proven Results Across 400+ Organizations

Over the years, we’ve helped over 400 organizations, including industry leaders like Byju’s and Zomato, implement AI-driven solutions to streamline operations, improve customer experiences, and fuel innovation.

Our teams have delivered projects 3x faster than traditional development cycles while maintaining the security and scalability standards enterprise clients require.

We don’t build generic AI products and hope they fit your needs. We start with design thinking to understand your specific challenges, then build custom solutions that address real problems.

Ready to build AI solutions that meet the moment? If you’re a company in need of AI-driven solutions that align with evolving federal policies, Codewave offers the resources and support to help you succeed. Take the next step in your AI journey with us today.

Schedule a free consultation today.

FAQs

1. How do Trump’s AI executive orders directly affect my software development timeline?

If you’re building AI systems for federal clients, expect additional compliance documentation and testing phases. The neutrality standards add review cycles that weren’t there before.

For private sector projects, the main impact comes from potential cloud capacity improvements as data center permitting accelerates, though that benefit won’t materialize for 12 to 18 months.

2. Do I need to change how I train AI models because of these policies?

Only if you sell to federal agencies. The neutrality principles apply specifically to government procurement. However, the administration’s permissive stance on using copyrighted material for training data does give you more flexibility in how you source training datasets, though this position may face legal challenges.

3. Can my development team benefit from the expedited infrastructure policies?

Most likely indirectly. Unless you’re building your own data center with $500 million in capital, you won’t qualify for expedited permitting. Your cloud providers might build capacity faster, which could eventually mean better availability and pricing, but you won’t see immediate development advantages.

4. What does the export program mean for software companies looking to expand internationally?

You need a comprehensive AI technology stack to participate, not just a software product. If you have strong AI applications but lack hardware or security components, consider partnering with other companies to create a full package. The program offers federal financing and diplomatic support for selected proposals.

5. Should I be worried about the new H1B visa changes affecting my development capacity?

If you rely on international technical talent, budget for higher visa costs and prioritize higher-wage positions in your applications. The wage-based selection system favors senior roles. Consider building relationships with domestic training programs as alternative talent pipelines while navigating the new requirements.