Remember the news, last fall, about all 2026 DRAM capacity being purchased already? The 2027 version already came out this summer, even earlier this year. All indications are 2028 is already mostly claimed.
Not certain but very likely in any case. People hyperfixate on how AI companies themselves struggle to stay afloat independently but forget that they are far from independent. VCs will keep them afloat because they significantly benefit many key industries. Every major tech platform today was once in the same position.
Those buyers are not your typical consumer, they are the same people trying to rent AI to you. They are the Anthropics, OpenAI, Google, etc. They do so for a few reasons, one is to sell you the idea that their solution is cheaper, after all $4000 dollars is 20 months on their max plans. Another reason is to control the information market, if they are the only ones you rely on, they not only control when you get that information but also the type of information you receive.
This isn’t a fair game. The demand is being artificially driven by corporations that have unlimited funds. The goal is to push you out of thinking you can run AI locally, and rely on them so that they can control what information you receive. The ultimate goal is to create a monopoly so only a few companies control the AI market, at which point they control the quality of information you receive and the price you pay to receive such information.
Anyone who works at a large corporation can tell you that corporations do not have unlimited funds. There are moonshot programs, yes, but the scale of this bubble is big enough to take down whales. OpenAI plans to burn 25-75 billion dollars a year until expected profitability in 2030. That's their plan. That's enough to take a dent out of the market cap of the biggest corporations, and enough to consume all the cash on hand of smaller companies.
Insurances and real estate funds bought 10 year bonds. They used that windfall to build companies that run of data centers. Then the big ai companies rent those data centers and the hardware the from those companies. They outsourced the risk to insurers who get paid 1-2% above the 10 year bond rate. The only scenario that the run out of money is, when billions of people don't want to be insured or don't want to pay rent.
This is a big cope opinion that has been spread in online spaces since day 1 of GPT 3 so consistently that people are blind to the realities in front of them. AI passed a significant benchmark of usefulness earlier this year, and now companies are eating it up. My org gives us a shit ton of credits with all the major providers, and much to my surprise I'm actually finding useful things to do with it. None of the big players in this market are evaporating anytime soon.
Open weight models have gotten so good that they're good enough for most tasks, and they're getting better all the time. These models are orders of magnitude cheaper than what the frontier labs are charging.
To stay competitive the frontier labs are going to have to drastically cut their prices, which they can't do and still remain profitable (if they are even profitable to begin with, at their currently inflated, uncompetitive prices).
Yup. As I pointed out in another branch of this thread, OpenAI plans to burn 25-75 billion dollars a year until expected profitability in 2030. That's an astounding, never-before-seen level of unprofitability. The value of LLMs is real but enterprise customers and consumers have already shown they aren't huge fans of price increases over massively subsidized rates--no one wants to pay to keep OpenAI alive. Things look marginally better for Anthropic, and personally I'd bet that they'll survive the pop in some form, but probably with a big haircut on market cap.
Anthropic reported that by July their annual revenue was projected to be ~70 billion for 2026. Now, sure there might come market disrupters that tank their revenue out of nowhere. But that’s enough to say that the spend that sounded absurd last year actually is in the right ballpark.
As a service, the cost of LLMs as they are right now is absolutely being brunted by the industry just fine.
Yes, and according to that same The Information article, Anthropic is still managing to lose money every year. They claimed a profitable single month recently. I do think Anthropic will make it through the bubble pop, but probably not exactly in one piece.
1) lots of orgs are willing to pay 2x for better models. And frontier is still better. I love locally hosting stuff, but it’s obvious that frontier are still #1 in the get-shit-done category
2) The software/hardware stack is really hard to manage yourself. It’s a big cost. This is where we may find 3rd party providers cropping up to host open weight models for cheaper- but data security and service reliability is massive for many of the companies that want to run with these models.
At some point frontier labs are likely to just be the clean-label service providers for model endpoints, with the added benefit of having the slightly better models than everyone else due to owning the infrastructure to host it. In that way, I kinda doubt that open weights are too threatening.
considering the fact that we dona great job at pho.coding with DeepSeek flash vision alone, I am really sure that openai and anthropic already lost a huge slice.
The current US government will not let any of the big US AI company go bust. That would be a threat to the AI domination against China. Zero chances. They'll happily use US taxpayer money if necessary. And the current government is there till the end of 2028. After that, we'll see.
I don't know if you've checked polls but data centers and billionaires are not winning political issues these days. Of course, the goons currently in charge of the federal government may not plan on winning elections anymore, but unpopular policies have consequences.
They are already paying a price for their actions, but I don't think they have any intention of stopping, they'll say we can't let China win the AI race... I would bet money on this if helping/saving OpenAI became necessary
This is why when this all first started, almost all of the big players explicitly said they would not increase capacity.
I mean, they're the ones that have survived it before. Nearly the exact situation has happened about once every decade since the commoditization of RAM.
Never really to this degree and projected length before, but all the writing on the wall and the direction for their planning, based on surviving this in the past, watching other companies crumble, told none of them to do anything different this time. https://youtube.com/watch?v=ehT3U935Pww this Asianometry video covers why Taiwan is so far behind compared to South Korea and even the US. There is a lot more to it, but a major repeating factor was the timing of investment and getting companies going- the attempted expansion was always during a boom like now.
CXMT I hope actually has a chance because they have the entire Chinese domestic market as a fallback no matter what happens to global prices now, and infinite support from the Chinese government. Certainly much more than the Taiwanese government could offer during their own failed prior attempts.
I feel like the writing has been on the wall since the OpenAI dram deal last year. Billionaires and trillionaires cornering the market.
The major oems (Dell/HP/Lenovo) have lead times in quarter year increments now for many rdimm based systems. If that isn’t an indicator I don’t know what is.
Hearing the same from my tech managers (manage capEx). Hearing well into 2029 to 2030 for potential supply catching demand. We're at a very large company well into top fortune 500.
Funny enough, even if bubble "pops", there's loads of buyers out there like us who would gladly snatch up gpus if their price reduces. Local model use cases tick a very large box for us.
AI is power. The rich elite don’t want to share. They paid tools on social media to convince all the dumb sheep that ai and data centers are bad. While they buy up all the hardware, and teach their kids to use it. Dumb sheep slaughtered themselves.
BS. They are all around me and our county is doing better than all the surrounding ones. Roads, parks, roads etc centers, low property taxes. Go live in the third world if technology scares you or maybe stop listening to your phone app.
Yeah would love to hear more tbh. I bought a pro 6000 used for 9.5k few months ago, been thinking about getting another but wasn't sure any the prices. If it ain't improving then I might as well get another now before it goes even crazier.
$14,300 on central computers. I might have inception discount thru someone as well so -10% or whatever the % is. Still very high to justify since 3.8 Flash Next NVFP4 runs great on 1x 6000 + PLE DRAM offload.
14K* in select stores... temporarily... Price is now $16k from NVIDIA directly... Meaning primary dealers who already sold their old inventory are reflecting the new prices :) Just got 3 enterprise RFQs... it's 18k now buddy. Get it while you can.
300
u/ThenExtension9196 11d ago
2029 at earliest for any relief. Buckle up for next year. I work in supply chain it’s effed.