So like likes of AWS are spending crazy sums building capacity citing amazing demand they can’t meet. Meanwhile those with capacity are saying hey maybe we don’t need so much and are building cloud businesses to compete with AWS and flood the market with excess capacity.

Oh yeah, this is gonna end well.

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johndhi 2 hours ago | parent | next [-]

I don't really think this necessarily means demand is limited.

It just means demand is consolidating to winners. There's no denying openai and anthropic and maybe Google have a ton of demand. The fact that xai and meta do not does not mean no demand exists.

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cmiles8 2 hours ago | parent [-]

Everyone slamming the brakes on tokenmaxing and companies putting strict AI budgets in place is surely having at least some impact on demand.

And the point is not that “no” demand exists but the likes of AWS are building to the moon citing massive future need but that simply doesn’t jive with all this unused capacity from others coming to the market.

And building out massive capacity to sell a product that’s likely to trend to a low margin market commodity isn’t a great business.

	▲	eiejee 2 hours ago \| parent [-]
		Yeah today’s demand at existing and higher prices won’t persist. Firms are currently experimenting and figuring out the correct way to use these tools in the production function.

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Jordanpomeroy 2 hours ago | parent | prev | next [-]

Most of the demand for data center GPUs comes from the big tech companies themselves, to develop products/services.

Facebook and Twitter are both now signaling that the resources they funded with vast amounts of capital would be worth more to shareholders if they were leased to the highest bidder.

This is either a realization that their internally developed product/service roadmap is not panning out, or that the lease demand is so high that they’d be fools not to take advantage.

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nicce 2 hours ago | parent | prev [-]

> Oh yeah, this is gonna end well.

Hope so. It also would put hardware prices down.