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I hear this a lot, but what the hell. It's still computer chips. They depreciate. Short supply won't last forever. Hell, GPUs burn out. It seems like using i

• baxtr 2y ago
  If so wouldn’t it be the first time in history when more processing power is not used? In my experience CPU/GPU power is used up as much as possible. Increased efficiency just leads to more demand.
  • littlestymaar 2y ago
    I think you're missing the point: H100 isn't going to remain useful for a long time, would you consider Tesla or Pascal graphic cards a collateral? That's what those H100 will look like in just a few years.
    • ijidak 2y ago
      Yeah, exactly! I've got some 286, 386, and 486 CPUs that I want to claim as collateral!
    • baxtr 2y ago
      Not sure I do tbh. Any asset depreciates over time. But they usually get replaced. My 286 was replaced by a faster 386 and that by an even faster 468. I’m sure you see a naming pattern there.
      • kgwgk 2y ago
        > Any asset depreciates over time. That's why "those chips are very valuable" is not necessarily a good way to value companies - and it isn't if they can extract the value from the chips before they become worthless. > But they usually get replaced. They usually produce enough income to cover depreciation so you actually have the cash to replace them.
      • littlestymaar 2y ago
        And that's why such assets represents only a marginal part of valuation. (And if you look at accounting, this depreciation is usually done over three years for IT hardware, and as such most of these chips have already lost half of their accounting value in the balance sheet).
      • baq 2y ago
        My 1070 was replaced by… nothing, I moved it from a haswell box to an alder lake box. Given that inference time will soon be extremely valuable with agents and <thinking> models, H100s may yet be worth something in a couple years.
      • mvc 2y ago
        > My 286 was replaced by a faster 386 and that by an even faster 468. How much was your 286 chip worth when you bought your 486?
• sixothree 2y ago
  Year over year gains in computing continue to slow. I think we keep forgetting that when talking about these things as assets. The thing controlling their value is the supply which is tightly controlled like diamonds.
  • adrianN 2y ago
    They have a fairly limited lifetime even if progress stands still.
    • throwup238 2y ago
      Last I checked AWS 1-year reserve pricing for an 8x H100 box more than pays for the capital cost of the whole box, power, and NVIDIA enterprise license, with thousands left over for profit. On demand pricing is even worse. For cloud providers these things pay for themselves quickly and print cash afterwards. Even the bargain basement $2/GPU/hour pays it off in under two years.
      • sdenton4 2y ago
        Labor! You need it to turn the bill of sale into a data center and keep it running. The bargain basement would be even cheaper otherwise...
  • spamizbad 2y ago
    > Year over year gains in computing continue to slow. This isn't true in the AI chip space (yet). And so much of this isn't just about compute but about the memory.
    • eek2121 2y ago
      From a per mm2 performance standpoint things absolutely have slowed considerably. Gains are primarily being eked out via process advantage (which has slowed down) and larger chips (which has an ever-shrinking limit depending on the tech used) Chiplets have slowed the slowdown in AI, but you can see in the gaming space how much things have slowed to get an idea of what is coming for enterprise.
• ecocentrik 2y ago
  That is the wrong take. Depreciated and burned out chips are replaced and a total compute value is typically increased over time. Efficiency gains are also calculated and projected over time. Seasons are inevitable and cyclical. Spring might be here but winter is coming.