This is how every ramp-up in a market works. It is called hedging. The promised sales volume at that higher price then let companies invest in higher supply.
The problem here is that none of only four companies which manufacture RAM don‘t want to compete for this demand, but instead share the price increase among each either in profit margins. (This is of course, because they don‘t believe in the AI hype, but nonetheless RAM manufacturing is an oligopoly, which is a problem in of itself.)
Ramping up supply costs money, and the AI bubble is on the verge of popping. They’d need to know that this demand would be sticking around before investing in higher fab capacity.
I’m going to be that guy and point out that LLM’s are not really “AI”, that’s just the corporate buzzword but “AI” is a loosely defined thing.
I think we should all get better at calling them LLM’s publicly to take some of the magic woo-woo away.
I think we should call it with the more appropriate acronym: Systematic Approaches to Learning Algorithms and Machine Inferences (SALAMI)
yes, I’ll call them AI when they are sentient D:
I was spoiled by Iain Banks’s Culture <3
Iain M. Banks, don’t ya know!?!?
I’m still saving a culture book or two to enjoy, but the entire setting has been amazing.
I agreed years ago, but it’s too late now.
“Big Data”, “Neural Net”, etc etc, they keep changing the buzzword for this crap for the past decade.
AI just resonates with the public because everyone has seen Terminator movies. Your dipshit CEO of Buttplugs Inc has no clue what an LLM, or neural net is. But he knows what AI is and he delusionally believes it’s going make Buttplug inc. more profitable in the future.
It’s effective marketing.
i saw my first hover board in back to the future, the pink one. now it’s that overpriced exploding segway.
at least the name segway was almost creative
if hover boards were legit real you’d have so many injuries the company would be sued into insolvency.
already starting to see this with ebikes… massive increases in head trauma numbers since they became popular. mostly from old people buying a $5000 e bike and then riding it w/o a helmet at 15-20mph.
that didn’t stop RAZOR scooters
Well, if this does come to pass then we’ll be getting a ton of cheap memory next year.
Is this a gross exaggeration, or is the entire SaaS-to-hardware supply chain under such deep speculation right now?
It’s exaggerated, yes. It’s not gross.
It’s basically an arms race for a future AI war that probably won’t happen.
Sort of like how armies were bankrupting themselves building battleships before WW1… which turned out to not be a sea war at all.
The fear ‘losing out’ on AI is making companies, and people, totally irrational. All the big players are paranoid that one of the other ones is going to ‘get head’ of AI market and become a monopoly, just like it was in the past with Google and search, or Apple and the iphone, etc. So crazy stupid expenditures and these massive data center plans now are considered a necessity.
But you are correct the AI demand… simple isn’t there and probably won’t materialize and the bubble will collapse.
Sort of like how armies were bankrupting themselves building battleships before WW1
An interesting little tidbit: in 1912, 52% of Germany’s entire military budget went to the navy. The same navy that spent WWI shelling small coastal villages (killing tens of people) and fleeing from the British navy.
all the big players are paranoid that one of the other ones is going to “get head”
Imagine being worried that someone else is getting a BJ.
I do sort of constantly worry about it. What if someone out there isn’t with me and they’re getting a bj? What if it’s not good enough? Have I failed if someone is out there getting a subpar bj, and can I correct the situation somehow?
low exaggeration, imo.
This is mostly an excuse for extortion right now, making people FOMO for ram instead of Luigi’ing the industry execs. If the AI FOMO demand actually materializes, the next generation cards will actually be far more expensive per flop/gb than older ones. NVIDIA wouldn’t be begging to sell chips to China instead of Americans/colonies, if there was demand.
It’s all too crazy, but those who FOMO will lose out. AI/LLMs will continue improving, but waiting for oversupply is the right play.
This is all just gambling with a bunch of cheaters. They can’t use crypto schemes as much because people FINALLY figured out they were pump and dump scams … so AI investment it is.
…using gigawatts of power that aren’t available on the grid
And megaliters of fresh water.
Immortan Joe sees an opportunity.
The water-thing is mostly bullshit, see https://andymasley.substack.com/p/empire-of-ai-is-wildly-misleading / https://www.youtube.com/watch?v=H_c6MWk7PQc
see that’s crap because they need muni clean water; it’s gotta come from SOMEWHERE, and your muni water system wasn’t setup to feed a city AND a bunch of datacenters. so it’s gonna have to expand - and who’s gonna pay for that? NOT THE AI. The people will pay for it, every fucking time.
Agriculture uses so much more water. Just so we can grow corn so it can be turned into ethanol. “AI” uses so much more energy though. and it’ll only get worse, the more “advanced” the llms become, the more energy they’re going to require.
And creating energy is also using large amounts of water.
it typically uses non-potable water though, and that water is then typically evaporated as steam which then in precipitated back down, or it’s directly routed back into the stream it came from, which is the case in hydroelectric systems
The water that’s returned is significantly warmer though, which can have some pretty large effects on the local environment.
that is true
Energy use is a more real concern, yes.
there are entire cities facing water crisis already. water is going to be a huge concern going forward.
https://wetravelwebond.com/13-u-s-cities-on-the-brink-of-a-water-crisis/
don’t believe the ‘it’s only a tiny bit of water’ bullshit
Most of the water used by “AI” is in energy generation though, so you’re both right.
to me it’s simply not an either:or it’s an yes:and
the utility customers of these municipalities aren’t being told about the construction of AI data centers, because so many come with NDA strings.
we don’t have infinite potable water. it’s going to come from municipal supplies. they’re going to stick the cost to these communities, and probably stress cities that are already water-fucked even more:
https://wetravelwebond.com/13-u-s-cities-on-the-brink-of-a-water-crisis/
I suggest you read the article I posted, or if you don’t feel like reading, maybe listening to what’s being said in the YouTube video.
There are some very real concerns with everything happening around AI. Water is quite simply not one of them. Focus your energy on criticisms based in reality.
I’d already seen Green’s video. I agree it’s a small thing compared to the power, but in a world obviously running out of easily accessible potable water, it’s only going to exacerbate problems for the communities that are already being hit by the relentless power costs due to AI as well.
This isn’t a one or the other thing. They’ll need water for cooling. It’s not recycled. it’s got to be clean, potable water.
we do not live in an infinite muni-water supply.
Yeah, thanks, this random substack and YouTube video definitely are credible and trustworthy sources.
As opposed to your vibes?
This actually explains a few things for me.
I never considered that RAM and GPUs could be traded as futures, but obviously they can…
This also reminds me of the trader at a trading company in London who had to take delivery of 28000 tonnes of coal due to forgetting to sell a future he owned.
He only found out as the receptionist asked him to come down and sign for it and he saw barges of coal coming down the river:
Listen, I’m with you, but the reason is hyper capitalist speculative greed. It could be anything we’re talking about “ghee wiz price upon rice hath trippled during these trying times because some bloke in Nippon stamped some papers to offer part of next seasons crops and the king gobbled these up like tendies on a naked lady”
I mean, credit where credit’s due. This is just their next gang rape horse and the fact that it’s visibly dead for months isn’t really relevant to them. The one that gags first will just get stuck with the bags after the seasonal bukkake festival
That’s a hell of a mental picture you painted
Remember folks, since the end of COVID another greedy cork sucker is crowned next billionaire every 30 hours.
The number of billionaires in the USA has nearly and will shortly eclipse double the number there were before 2020. How did they do that, you fucking know. By pretending they would die and their children would get AIDS if they didn’t raise the price of every single product on the planet exorbitantly and without need to increase already skyrocketing year to year profitability. These greedy bastards not only did this, they want to kill all of us who they fleeced before we wake up to the facts.
TOO LATE
They never learn, can’t self regulate and won’t give a flying fuck until presented with a French solution
Maybe I’m crazy, but I’m thinking this generation of AI is going to be a rug pull, and all of these companies will be “too big to fail” and they’ll make a fortune as the consumers and taxpayers carry the cost.
Sounds about right, history is a circle
If we have to play this bubble game, can we at least force them to build some renewable energy sources with their unlimited funds so when the bubble pops, we have some extra renewable energy available to the grid?
Pretty sure Trump banned woke energy
Wind and sun are for SISSIES, even if it’s CHEAPER! Nuclear plants are not antifa-woke, but my pal A.Jones says it makes everyone GAY. Drill baby, drill!
Bastard obviously wants to colonize Venezuela.
pretty sure they dont have the funds to build a power plant that is renewable, or a nuclear plant. thats why the cost of water/electricity is passed onto customers of electric and water companies.
Fuck capitalism
profits that won’t happen
I have yet to see speculation as to how the bubble survivors make a profit. At this point I think AI is being pushed to keep propping up the US economy.
You’re not alone in thinking that. The US economy is growing but all of that is allocated to 5 companies, and in any case the owners of that equity aren’t a majority median income earners. We’ve essentially decoupled the economic health of the common person, who would actually spend on the bubble survivors, from the overall “strength” of the US economy.
An interesting discussion on that thought about halfway through this - https://www.ft.com/content/bd6545dc-41b7-42db-af77-b2f32a1c9ae1
That’s a great question Shalafi! The answer is government mandated pillow talks to your AI companions. Would you like me to provide todays’ topics in advance?
So they can replace all workers. and won’t be able to make profit because they layed off all of the workers. Why do we need a government if they are investing all our resources in phasing us out? If you don’t work in our system you die so why are we allowing this again?
The rich have it going both ways. They have convinced a subset of the lower classes to fight amongst and blame each other. Meanwhile they very shortdightedly are maximizing profits (not from the lower classes anymore because they have essentially bled us dry) but from other rich people who want to invest to maximize profits.
They have forgotten that the only way capitalism remains sustainable over time is if they continue to both provide products and services lower class individuals will spend money on, and if they continue to pay those lower class individuals money so they have money to spend. Right now they’re busy grifting each other and our government is too stupid to look to the future, realize that the bubble has to pop sometime, and realize what that will mean for the market, the tax system, the tax payers, and the populace at large.
This is class warfare for profits over literally everything and it is going to crash the economy probably sooner rather than later.
They win if the bubble pops too because then they just buy everything for pennies on the dollar
There are two kinds of parasites:
- A smart parasite keeps its host alive. It limits the substance it leeches, prioritizing long term survival over short term satisfaction.
- A dumb parasite takes as much as it can. Even if it causes the host to die, and the parasite to die with it.
Of course - “smart” and “dumb” are used liberally here. The organism itself is not intelligent, and neither is the process who designed it. At least - that’s how it works in nature.
So basically neoliberals are smart parasites and republicans are dumb parasites
Because idiots think that if we let the super rich become ultra rich then they will somehow in turn become regular rich.
Because people are stupid, the difference in intelligence between the stupidest and smartest people is increasing, and democracy puts the decision making process in the hands of the masses which are intrinsically stupid
It’s a whole system designed for “intelligent” (read: manipulative, immoral, rich) people to take advantage of stupid people, and it works wonderfully in their favor.
And there’s fuck all an average person can do about it besides attempt to deal with the stupid people and convince them to do more intelligent things.
I hate it here. I want to be surrounded by people capable of reason already…
If only capitalist democracy put the decision making power in the hands of the masses. We would have universal healthcare by now and like none of the wars of the past 30 years.
No, really it’s the capitalists who make decisions, and they’ve designed it so that the people who own capital can take advantage of the people who don’t own capital. It’s got very little to do with smart vs stupid, and very much to do with “has” vs “has not.”
This is exactly it. It’s also why education has been under attack since the 80’s. It’s also why we fund schools based on the property tax
yea, the fact that Trump won the elections kinda supports my argument
people act as they vote
I, too, have a fundamental hatred of the bell curve humanity finds itself on. I have better things I want to do than convince a bunch of dumb fucks to make better decisions. The psychopaths on the other hand delight in manipulating idiots. This is why I believe we should genetically study psychopathy and CRISPR that shit away.
and then try to salvage thier industry, by hiring"cheaply" SENIOR tech/engineers,etc and maybe outsource to AI=ALWAYS indians and still face bankruptcy.
