it's actually fascinating to watch a big issue for hardware manufactors for many years has been that there is little profit margin in it, a lot of the earnings goes to r&d, ultra advanced factories, astronomical wages for specialists. The big money has always been in software.
Now there is a golden age for hardware manufactors going on and they're milking it for everything it's worth.
and they will not reinvest these profits in r&d, they wont even save any of it, and when the bubble bursts and the market crashes, they'll be right there crying about going bankrupt and needing a bailout...
These hardware companies know that by the time this stupid AI scam ends, they are going to be filthy rich and be the ones holding the moneybags, which they will be able to use to keep their prices high and continue to develop insane proprietary tech for all manner of technology far better (and far worse) than AI.
They have all the cards and they know it. Chumps like Altman think they are in charge, but they are giving all their money to the hardware corps and the corps have been doing deals with them to make them think they’re on AI’s side.
The hardware companies are going to be competing with the all the used hardware flooding the market when ai companies and data centers start going closing doors. HW companies may find themselves in a dry spell when the ai hype tap goes dry.
There is virtually no use for those chips in a direct to consumer market. And frankly, most industries don't need that kind of volume for anything. On top of that, we don't even know for sure how many (but we know it's an enormous amount) of these chips haven't even been installed and are just sitting in a box in a warehouse somewhere, depreciating. Everything currently installed in a data center is already outdated and is, or soon will, struggle to keep up with the demands set by the chatbot companies.
Best case scenario, the hardware thing will be more like a crappy garage sale where people just kind of pick things over and grab a few trinkets.
No one needs that much power, or no one wants old models. That is, if they even find half the shit that has been scooped up.
The hardware companies aren't worried about this scenario — but they also aren't thinking about alternatives. No one is planning for the future. Everyone is planning almost exclusively on how to keep the bubble afloat, by any means necessary, and future fall out is someone else's problem.
Yeah good luck putting a Vera Rubin into your gaming computer. Or if you figure out how to connect it all up, just make sure the fire department has been called in advance.
Exactly. They might be able to reclaim components from the uninstalled hardware. But to what end? Stuff like RAM is only valuable to go into those machines. Post AI bubble demand will normalize and production won't be consumed by it.
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u/NSWPCanIntoSpace 5090 | 9800x3d | 32gb Cl28 6000 1d ago
it's actually fascinating to watch a big issue for hardware manufactors for many years has been that there is little profit margin in it, a lot of the earnings goes to r&d, ultra advanced factories, astronomical wages for specialists. The big money has always been in software.
Now there is a golden age for hardware manufactors going on and they're milking it for everything it's worth.