| ▲ | mikkupikku 11 hours ago |
| If a taxi company did that every year, they'd be losing a lot of money. Of course new cars and cards are cheaper to operate than old ones, but is that difference enough to offset buying a new one every one to three years? |
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| ▲ | gruez 11 hours ago | parent | next [-] |
| >If a taxi company did that every year, they'd be losing a lot of money. Of course new cars and cards are cheaper to operate than old ones, but is that difference enough to offset buying a new one every one to three years? That's where the analogy breaks. There are massive efficiency gains from new process nodes, which new GPUs use. Efficiency improvements for cars are glacial, aside from "breakthroughs" like hybrid/EV cars. |
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| ▲ | dylan604 11 hours ago | parent | prev | next [-] |
| >offset buying a new one every one to three years? Isn't that precisely how leasing works? Also, don't companies prefer not to own hardware for tax purposes? I've worked for several places where they leased compute equipment with upgrades coming at the end of each lease. |
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| ▲ | mikkupikku 9 hours ago | parent | next [-] | | Who wants to buy GPUs that were redlined for three years in a data center? Maybe there's a market for those, but most people already seem wary of lightly used GPUs from other consumers, let alone GPUs that were burning in a crypto farm or AI data center for years. | | |
| ▲ | dylan604 7 hours ago | parent | next [-] | | > Who wants to buy who cares? that's the beauty of the lease. once it's over, the old and busted gets replaced with new and shiny. what the leasing company does is up to them. it becomes one of those YP not an MP situations with deprecated equipment. | | |
| ▲ | bluGill 5 hours ago | parent [-] | | The leasing company cares - the lease terms depend on the answer. That is why I can lease a car for 3 years for the same payment as a 6 year loan (more or less) - the lease company expects someone will want it. If there is no market for it after they will still lease it but the cost goes up |
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| ▲ | coryrc 9 hours ago | parent | prev | next [-] | | Depends on the price, of course. I'm wary of paying 50% of new for something run hard 3 years. Seems an NVIDIA H100 is going for $20k+ on EBay. I'm not taking that risk. | |
| ▲ | pixl97 8 hours ago | parent | prev [-] | | Depending on the discount, a lot of people. |
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| ▲ | gowld 10 hours ago | parent | prev [-] | | That works either because someone wants to buy old hardware for the manufacturer/lessor, or because the hardware is EOL in 3 years but it's easier to let the lessor deal with recyling / valuable parts recovery. |
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| ▲ | wordpad 11 hours ago | parent | prev | next [-] |
| If your competitor refreshes their cards and you dont, they will win on margin. You kind of have to. |
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| ▲ | lazide 11 hours ago | parent [-] | | Not necessarily if you count capital costs vs operating costs/margins. Replacing cars every 3 years vs a couple % in efficiency is not an obvious trade off. Especially if you can do it in 5 years instead of 3. | | |
| ▲ | iancmceachern 5 hours ago | parent | next [-] | | You highlight the exact dilemma. Company A has taxis that are 5 percent less efficient and for the reasons you stated doesn't want to upgrade. Company B just bought new taxis, and they are undercutting company A by 5 percent while paying their drivers the same. Company A is no longer competitive. | | |
| ▲ | Dylan16807 4 hours ago | parent [-] | | The debt company B took on to buy those new taxis means they're no longer competitive either if they undercut by 5%. The scenario doesn't add up. | | |
| ▲ | iancmceachern 3 hours ago | parent [-] | | But Company A also took on debt for theirs, so that's a wash. You assume only one of them has debt to service? | | |
| ▲ | Dylan16807 3 hours ago | parent [-] | | Both companies bought a set of taxis in the past. Presumably at the same time if we want this comparison to be easy to understand. If company A still has debt from that, company B has that much debt plus more debt from buying a new set of taxis. Refreshing your equipment more often means that you're spending more per year on equipment. If you do it too often, then even if the new equipment is better you lose money overall. If company B wants to undercut company A, their advantage from better equipment has to overcome the cost of switching. | | |
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| ▲ | zozbot234 10 hours ago | parent | prev [-] | | You can sell the old, less efficient GPUs to folks who will be running them with markedly lower duty cycles (so, less emphasis on direct operational costs), e.g. for on-prem inference or even just typical workstation/consumer use. It ends up being a win-win trade. | | |
| ▲ | lazide 9 hours ago | parent [-] | | Then you’re dealing with a lot of labor to do the switches (and arrange sales of used equipment), plus capital float costs while you do it. It can make sense at a certain scale, but it’s a non trivial amount of cost and effort for potentially marginal returns. | | |
| ▲ | pixl97 7 hours ago | parent [-] | | Building a new data center and getting power takes years to double your capacity. Swapping out out a rack that is twice as fast takes very little time in comparison. | | |
| ▲ | lazide 7 hours ago | parent [-] | | Huh? What does your statements have to do with what I’m saying? I’m just pointing out changing it out at 5 years is likely cheaper than at 3 years. | | |
| ▲ | pixl97 6 hours ago | parent [-] | | Depends at the rate of growth of the hardware. If your data center is full and fully booked, and hardware is doubling in speed every year it's cheaper to switch it out every couple of years. |
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| ▲ | philwelch 10 hours ago | parent | prev [-] |
| If there was a new taxi every other year that could handle twice as many fares, they might. That’s not how taxis work but that is how chips work. |
