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Signs of a bubble in this sector are everywhere. OpenAI is trying to fundraise a $5tn infrastructure buildout on $15bn in annual revenue. That's insane.

What's worse is that OpenAI and the other AI companies are all intertwined. The chipmakers are invested in the datacenter operators are invested in the software guys. When the bubble implodes - and it will implode - the good will go down with the bad, and that's what makes a financial crash a true crash.

discuss

bob1029|4 months ago

The AMD/OpenAI deal sounded like the music stopping to me.

nostrademons|4 months ago

That and the 3-way "OpenAI pays Oracle $300B in cloud computing on their $15B of revenue", "Oracle buys $40B of NVidia chips for their new datacenter", "NVidia invests $100B in OpenAI". The money's just moving around and around, propping up revenue numbers for Wall Street, but the consumer benefits are dubious.

https://www.nbcnews.com/business/economy/openai-nvidia-amd-d...

hn_throwaway_99|4 months ago

What about the NVidia/OpenAI deal? Such a giant investment in a huge customer looks a heck of a lot like "circular dealing". That is, invest $100 million so your biggest customer can spend a ton of that on your own chips. You get to report skyrocketing revenue but that revenue was bought with your own money.

MontyCarloHall|4 months ago

If the AMD/OpenAI deal means that OpenAI will put serious work into making AMD GPUs finally be more amenable to general purpose computing, it's actually a huge win for AMD. None of the major numerical computing frameworks (PyTorch, TensorFlow, JAX, etc.) work as well on AMD GPUs versus NVIDIA GPUs, and that's really holding AMD back from making inroads into the machine learning space.

If this means that compute is considerably cheaper for OpenAI, it's a win for them too. But that remains to be seen.

SchemaLoad|4 months ago

The pivot all the companies made to TikTok style video shitpost apps felt like that too. The ideas are running out and they need a money maker now.

j-krieger|4 months ago

This also has gigantic impact potential. Imagine if Lehman Brothers only had one competitor, and they were also at risk to be seriously impacted.

overfeed|4 months ago

They should hurry up and build the DCs at double-time then! The last tech crash left us with lots of dark fiber that enabled really cool applications and very low costs.

I can only imagine what could grow out of an oversupply of rack-space and electrical power generation, post-crash.

mjhay|4 months ago

Electrical power and maybe rack space, but the glass strands of the dark fiber were still perfectly good a number of years later, once demand catches up. Buildings and such still need continuous maintenance. In addition, the actual computational equipment (such as the GPUs that have given nvidia the highest market cap in the world) will be totally worthless.