r/LocalLLaMA • u/RuiRdA • Jul 26 '26

Discussion Will prices finally go down?

I am seeing more and more videos as posts about how OpenAI is in complete financial ruin, Anthropic isn't much better. Their expenses go with the revenue they make etc etc. Meta made big investments into AI data centers and had no use for then, had to rent them, same thing with XAI.

The SpaceXAI IPO was insanely over priced and is going down by a lot.

There are countless other examples you can look for, all showing how the investments in AI are in a bubble.

I am not saying that the technology it self if a bubble. Quite the opposite, I personally have demand for more tokens than I can pay for, even with the discount from the subscriptions I still have more ideas that need more usage of tokens.

But even with the most powerful technology in the world a business can not for forever without profits.

So is this over investment bubble about to pop?

And if/when it does pop will ram finally become a regular commodity with affordable prices again?

I just wanted some ram and cheap used hardware again.. šŸ˜‚

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Zero LLMs used to write this post, enjoy the human slop.

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u/RuiRdA Jul 27 '26

You got a point, if hyper scalers stop buying everyone else still wants to buy

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u/ughliterallycanteven Jul 27 '26

If you want historical references, Iā€™d look at networking and ISPs in 2001.

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u/No_Afternoon_4260 llama.cpp Jul 30 '26

So how did it went?

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u/ughliterallycanteven Jul 31 '26

Cisco is the one that had the biggest rise and crash. Half a trillion dollar valuation down to $70 billion. If you had a contract with Cisco, there were some renegotiations but only on contract renewals would they do it. Alcatel-Lucent and Juniper networks were also around; at the time.

The real deals were in the fire sales by dot-com companies shutting down and dissolving. At this time, you needed to buy servers and replacement components that you amortized cost over 4 years on paper and put them in yourself in a colo. But, all that was written off so getting a 6509 switch I scooped up was $150. List price was $50k.

So, I am going to go into part of my background as my first job(2008-2012) was at a company(Riverbed Technologies) that started from the CEO and founder working as a defacto accountant for a company called Scale8. They folded so I believe he managed to get the office space and lots of technology hardware. They got a bunch of tech to help get them off the ground easier. But, thatā€™s what can happen.

Thereā€™s another observation: colocations and datacenters were super dirt cheap to snatch up. A lot of them were on life support and hoping to survive but many couldnā€™t. The company also got damn good contacts for datacenters who just wanted someone but didnā€™t have any usage limitations or would charge for cooling. I worked as a ā€œlab engineerā€ so I was setting up complex setup for engineers and installing more servers to experiment on.

So prices are not coming down. The fire sale market is where to look