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Increasing supply is not an issue if there is demand. As long as building more fabs brings more profit(even if at smaller margin), I can't see any reason why th
by YetAnotherNick 3y ago
Increasing supply is not an issue if there is demand. As long as building more fabs brings more profit(even if at smaller margin), I can't see any reason why they won't be building it. It's economics 101. Also as moore's law is coming to end, the number of fabs has no way to go but up.
Also I don't think manufacturing cost is the biggest of issue, because the margins are significantly higher than consumer GPUs which are in oversupply now for Nvidia. It's that Nvidia has to commit years in advance for the capacity.
- SilverBirch 3y agoThe problem is the bull whip effect. Yes there’s loads of demand now, but are we really saying that the AI boom is a permanent uptick in demand for silicon, or is it more likely that the hype dies down? By the time capacity comes online demand may well gave peaked and dropped. Suddenly these massive sunk cost fabs will be taking any business they can to amortise the costs.
- ethbr1 3y agoIt seems more likely that efficiency gains decrease aggregate compute requirements than people stop using AI tools altogether. At minimum, LLMs work as a better human-software interface medium, which means they're going to be infused in almost everything non-technical consumer-facing. Even absent any other breakthroughs, that seems like a huge consumer of AI hardware capacity.