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OpenAI and Nvidia announce partnership to deploy 10GW of Nvidia systems
- iphone_elegance 1y agofancy stock buyback lol
- Nevermark 1y agoThere are venture capital firms. Nvidia is transforming into a venture GPU company. X GPUs for Y percent.
- mxschumacher 1y agoopenAI is far past the venture stage
- eagerpace 1y agoWhere is Apple? Even from an investment perspective.
- rubyfan 1y agoBeing rationale.
- fancyfredbot 1y agoRational.
- brcmthrowaway 1y agoLosing the race
- richwater 1y agoThis is not something that can be won. The LLM architecture has been reaching it's limitations slowly but surely. New foundational models are now being tweaked for user engagement rather than productive output.
- gpm 1y agoRight, but is the race to the pot of gold, or the stoplight (in which case by "losing" they save on gas)?
- bertili 1y agoApple doing fine and often spend the same 100B in a year buying back Apple stocks.
- threetonesun 1y agoMy MacBook Pro runs local models better than anything else in the house and I have not yet needed to install a small nuclear reactor to run it, so, I feel like they're doing fine.
- me551ah 1y agoSo OpenAI is breaking up with Microsoft and Azure?
- freedomben 1y agoThey've been sleeping with Oracle too recently, so I don't think they're breaking up, just dipping a toe in the poly pool
- jsheard 1y agoIt's more resembling a Habsburg family tree at this point https://bsky.app/profile/anthonycr.bsky.social/post/3lz7qtjyw3s2t https://bsky.app/profile/anthonycr.bsky.social/post/3lz7qtjy... (pencil in another loop between Nvidia and OpenAI now)
- deleted 1y ago[deleted]
- sekai 1y agoIn true Bay Area fashion?
- Handy-Man 1y agoIt was more like Microsoft refused to build the capacity OpenAI was asking for, so they gave them blessing to buy additional compute from others. It does seem like Satya believes models will get commoditized, so no need to hitch themselves with OpenAI that strongly.
- FinnKuhn 1y agoI would say Microsoft cheated on OpenAI first ;) https://www.reuters.com/business/microsoft-use-some-ai-anthropic-shift-openai-information-reports-2025-09-09/ https://www.reuters.com/business/microsoft-use-some-ai-anthr...
- mmmllm 1y agoAre Anthropic and Google breaking up with Nvidia?
- ddtaylor 1y agoFor someone who doesn't know what a gigawat worth of Nvidia systems is, how many high-end H100 or whatever does this get you? My estimates along with some poor-grade GPT research leads me to think it could be nearly 10 million? That does seem insane.
- thrtythreeforty 1y agoSafely in "millions of devices." The exact number depends on assumptions you make regarding all the supporting stuff, because typically the accelerators consume only a fraction of total power requirement. Even so, millions.
- cj 1y ago"GPUs per user" would be an interesting metric. (Quick, inaccurate googling) says there will be "well over 1 million GPUs" by end of the year. With ~800 million users, that's 1 NVIDIA GPU per 800 people. If you estimate people are actively using ChatGPT 5% of the day (1.2 hours a day), you could say there's 1 GPU per 40 people in active use. Assuming consistent and even usage patterns. That back of the envelope math isn't accurate, but interesting in the context of understanding just how much compute ChatGPT requires to operate. Edit: I asked ChatGPT how many GPUs per user, and it spit out a bunch of calculations that estimates 1 GPU per ~3 concurrent users. Would love to see a more thorough/accurate break down.
- coder543 1y agoA lot of GPUs are allocated for training and research, so dividing the total number by the number of users isn’t particularly useful. Doubly so if you’re trying to account for concurrency.
- NooneAtAll3 1y agoI'm kinda scared of "1.2 hours a day of ai use"...
- Rudybega 1y ago
- gmm1990 1y agoStrange unit of measurement. Who would find that more useful than expected compute or even just the number of chips.
- credit_guy 1y agoA point of reference is that the recently announced OpenAI-Oracle deal mentioned 4.5 GW. So this deal is more than twice as big.
- leetharris 1y agoProbably because you can't reliably predict how much compute this will lead to. Power generation is probably the limiting factor in intelligence explosion.
- sedawkgrep 1y agoThat, and compute always goes up.
- skhameneh 1y agoI wouldn't be surprised if power consumption is a starting point due to things like permitting and initial load planning. I imagine this as a subtractive process starting with the maximum energy window.
- zozbot234 1y agoIt's a very useful reference point actually because once you hit 1.21 GW the AI model begins to learn at a geometric rate and we finally get to real AGI. Last I've heard this was rumored as a prediction for AI 2027, so we're almost there already.
- the_70x 1y agoCame only here searching for 1.21GW
- deleted 1y ago[deleted]
- xnx 1y agoWhat does this mean? "To support the partnership, NVIDIA intends to invest up to $100 billion in OpenAI progressively as each gigawatt is deployed."
- jstummbillig 1y agoI am confused as to what the question is.
- solarexplorer 1y agoThat they will invest 10$ in OpenAI for each W of NVIDIA chips that is deployed? EDIT: In steps of 1GW it seems.
- re-thc 1y ago> What does this mean? > to invest up to i.e. 0 to something something
- losteric 1y agoso nvidia's value supported by the value of AI companies, which nvidia then supports?
- patapong 1y agoPerhaps it means OpenAI will pay for the graphics card in stock? Nvidia would become an investor in OpenAI thereby moving up the AI value chain as well as ensuring demand for GPUs, while OpenAI would get millions of GPUs to scale their infrastructure.
- vlovich123 1y agoNvidia is buying their own chips and counting it as a sale. In exchange they’re maybe getting OpenAI stock that will be worth more in the future. Normally this would count as illegally cooking the books I think but if the OpenAI investment pays off no one will care.
- toomuchtodo 1y agoWhat if it doesn't?
- isodev 1y ago> Strategic partnership enables OpenAI to build and deploy at least 10 gigawatts of AI datacenters with NVIDIA systems representing millions of GPUs I know watts but I really can’t quantify this. How much of Nvidia is there in the amount of servers that consume 10GW? Do they all use the same chip? What if there is newer chip that consumes less, does the deal imply more servers? Did GPT write this post?
- mr_toad 1y agoYou don’t need AI to write vague waffly press releases. But to put this in perspective an H100 has a TDP of 700 watts, the newer B100s are 1000 watts I think? Also, the idea of a newer Nvidia card using less power is très amusant.
- nick__m 1y agoA 72 GPUs NVL72 rack consumes up to 130kW, so it's a little more than 5 500 000 GPUs
- az226 1y ago$150-200B worth of hardware. About 2 million GPUs. So this investment is somewhat structured like the Microsoft investment where equity was traded for Azure compute.
- hooloovoo_zoo 1y agoThese $ figures based on compute credits or the investor's own hardware seem pretty sketchy.
- fufxufxutc 1y agoIn accounting terms, this is a shady business practice known as "round tripping" where you invest in a company for the sole purpose of them buying your product. It allows you to count your revenue multiple times.
- klysm 1y agoIs it counting revenue multiple times? It's buying your own products really, but not sure how that counts as double counting revenue
- fufxufxutc 1y agoThe "investment" came from their revenue, and will be immediately counted in their revenue again.
- weego 1y agoIn this case it seems that if we're being strict here the investment could then also show up as fixed assets on the same balance sheet
- lumost 1y agoIt's real revenue, but you are operating a fractional reserve revenue operation. If the person your investing in has trouble, or you have trouble - the whole thing falls over very fast.
- rsstack 1y agoCustomer A pays you $100 for goods that cost you $10. You invest $100-$10=$90 in customer B so that they'll pay you $90 for goods that cost you $9. Your reported revenue is now $100+$90=$190, but the only money that entered the system is the original $100.
- FinnKuhn 1y agoAnd your evaluation also rises as a consequence of your increased revenue.
- bertili 1y agoWhats in it for Nvidia? At the recent 300B valuation, 25% equity?
- searine 1y agoI look forward to subsidizing this effort with my skyrocketing home power bill.
- deleted 1y ago[deleted]
- DebtDeflation 1y agoWouldn't Nvidia be better served investing the $100B in expanding GPU manufacturing capacity?
- ecshafer 1y agoBy investing in TSMC? By buying TSMC? I don't think $100B would buy them enough current generation capacity to make a difference from scratch.
- paxys 1y agoThe don't have to pick just one.
- vessenes 1y agoThey’re already spending as much money as they possibly can on growth, and have no further use for cash currently - they’ve been doing share buybacks this year.
- TheRealGL 1y agoDid I miss the part where they mention the 10 large nuclear plants needed to power this new operation? Where's all the power coming from for this?
- HDThoreaun 1y agoBuild this thing in the middle of the desert and you would need around 100 sq mile of solar panels + a fuck load of batteries for it to be energy independent. The solar farm would be around $10 billion which is probably far less than the gpus cost
- ecshafer 1y ago[flagged]
- Aeolun 1y agoOn sand?
- HDThoreaun 1y agoThis is a man's world
- retr0rocket 1y ago[dead]
- jonfromsf 1y agoEnvironmentalists are just against progress. A few desert species going extinct is not a big deal. It's an arid wasteland. When we eventually terraform it (with desalinated water from solar / fusion) those species are going to die out anyway.
- deleted 1y ago[deleted]
- samtp 1y ago
- lumenwrites 1y agoYaay, one step closer to torment nexus.
- nh23423fefe 1y agolow effort comment, whose content is a stale reference to other low effort memes
- andreicaayoha 1y agopls
- zuInnp 1y agoYeah, who cares about the enviroment... who needs water and energy, if you AI agent can give you better pep talk
- rlv-dan 1y agoDon't forget about better filters for influencers talking about the climate crisis!
- tgv 1y agoWhen fucking up the human mind isn't enough. This is really villainous. And before you think that's nonsense, let's not forget these people are accelerationists. Destroying the fabric of society is their goal.
- novaRom 1y agoWhat's the purpose to have access to smart assistants if it doesn't result in improving your basic needs, not improving your quality of life? Who is spending now? Only high income households, while majority is struggling with high utility bills and grocery prices - very basic needs.
- moduspol 1y agoWaiting patiently for the Ed Zitron article on this...
- nextworddev 1y agoHe single-handedly cost people more than anyone with his bearish takes lol
- topaz0 1y agoOr he saved them more than anyone by limiting their losses when it does finally crash
- nextworddev 1y agoexcept he called the top in 2023
- mikhmha 1y agoIts not a good argument against him. I read his articles and he is absolutely correct about the state of things. Predicting the crash is a fools errand. I don't use that as a argument to discredit what he actually writes regarding the raw economics of the AI industry. I say this as someone who has been holding NVDA stock since 2016 and can cash out for a large sum of money. To me its all theoretical money until I actually sell. I don't factor it into financial planning. You don't see me being a cheerleader for NVDA. Even though I stand to gain a lot. I will still tell you that the current price is way too high and Jensen Huang has gotten high off his own supply and "celebrity status". After all, we all can't buy NVDA stock and get rich off it. Is it truly possible for all 30,000+ NVDA employees to become multi-millionaires overnight? That's not how capitalism works.
- nextworddev 1y agoHe’s been absolutely wrong on most things but spreading FUD is how he makes money, like Gary Marcus
- catigula 1y agoCan we get some laws to force these companies to start subsidizing the consumer grids they're pummeling? The electric bills are getting out of hand.
- 2OEH8eoCRo0 1y agoWhat will happen if/when the AI bubble pops and there is far more grid capacity than demand? Power plant bailouts?
- davis 1y agoLoad growth for the last 15 years has been very small but load growth going forward is expected to rise due to electrification of all things to decarbonize the economy. This means home heating, electrical cars, heavy industries, obviously data centers and the list goes on. So even if we have more grid capacity than demand (this seems unlikely), it will be used before too long.
- JCM9 1y agoWill just make capacity available for electrification of other infrastructure like heat pumps, electric cars, and so on. Lots of other folks would happily buy that power. The whole AI bubble is just driving up electricity pricing for everyone else at the moment.
- vmg12 1y agoThey would build their own power lines / grid if they could.
- aanet 1y agoI'm old enough to remember when vendor financing was both de rigueur and also frowned upon... (1990s: telecom sector, with all big players like Lucent, Nortel, Cisco, indulging in it, ending with the bust of 2001/2002, of course)
- alephnerd 1y agoThis absolutely feels like the Telco Bubble 2.0, and I've mentioned this on HN as well a couple times [0] [0] - https://news.ycombinator.com/item?id=44069086 https://news.ycombinator.com/item?id=44069086
- boringg 1y agoFor sure a great infrastructure build out -- lets hope the leftover are better energy infrastructure so that whatever comes next in 7 years after the flame out has some great stuff to build on (similar to telco bubble 1.0) and less damaging to planet earth in the long arc.
- alephnerd 1y agoYep. The Telco Bust 1.0 along with the Dotcom Bust is what enabled the cloud computing boom, the SaaS boom, and the e-commerce boom by the early-mid 2010s. I think the eventual AI bust will lead to the same thing, as the costs for developing a domain-specific model have cratered over the past couple years. AI/ML (and the infra around it) is overvalued at their current multiples, but the value created it real, and as the market grows to understand the limitations but also the opportunities, a more realistic and permanent boo' will occur.
- aanet 1y agoYeah - no doubt on the eventual productivity gains due to AI/ML (which are real, of course, just like the real gains due to telecom infra buildup), but must an economy go through a bubble first to realize these productivity gains?? It appears that the answer is "more likely yes than not". Counting some examples: - self driving / autonomous vehicles (seeing real deployments now with Waymo, but 99% deployment still ahead; meanwhile, $$$ billions of value destroyed in the last 10-15 years with so many startups running out of money, getting acquihired, etc) - Humanoid robots... (potential bubble?? I don't know of a single commercial deployment today that is worth any solid revenues, but companies keep getting funded left / right)
- lawlessone 1y agoNvidia if you're listening give me 10K and i'll bu...*invest 10K+ 10 euro worth of cash in your product.
- ath3nd 1y ago[dead]
- deleted 1y ago[deleted]
- EcommerceFlow 1y agoIf Solar can't compete with natural gas economically, and subsidizing solar ends up de-incentivizing natural gas production by artificially lowering energy prices, what's the solution here?
- henearkr 1y agoYour question is weird. Solar does compete economically with methane already, and it's only going to improve even more.
- EcommerceFlow 1y agoIf true, why aren't we mass scaling it all over the American West? We have railways running from West -> East, why not include power lines that can take power from energy farms in the West -> East? No major project in AZ, TX, or CA to give a city free power? etc
- henearkr 1y agoIt is massively scaling everywhere, and notably in Texas btw.
- ux266478 1y ago> We have railways running from West -> East, why not include power lines that can take power from energy farms in the West -> East? Firstly, there is no such thing as an infinitely scaling system. Secondly, because power transmission isn't moving freight. The infrastructure to move electricity long distances is extremely complicated. Even moving past basic challenges like transmission line resistance and voltage drop, power grids have to be synchronized in both phase and frequency. Phase instability is a real problem for transmission within hundreds of miles, let alone thousands upon thousands. Also that infrastructure is quite a bit more expensive to build than rail or even roads, and it's very maintenance hungry. An express built piece of power transmission that goes direct from a desert solar farm to one of the coasts is just fragile centralization. You have a long chain of high-maintenance infrastructure, a single point of failure makes the whole thing useless. So instead you go through the national grid, and end up with nothing, because all of that power is getting sucked up by everyone between you and the solar farm. It probably doesn't even make it out of the state it's being generated in. BTW the vast majority of the cost of electricity is in the infrastructure, not its generation. Even a nuclear reactor is cheap compared to a large grid. New York city's collection of transmission lines, transformers, etc. (not even any energy generation infrastructure, just transmission) ballparks a couple hundred billion dollars. Maintenance is complex and extremely dangerous, which means the labor is $$$$. That's what you're paying for. That's why as we continue to move towards renewables price/watt will continue to go up, even though we're not paying for the expensive fuel anymore. The actual ~$60 million worth of fuel an average natural gas plant burns in a year pales in comparison to the billions a city spends making sure the electrons are happy.
- zitterbewegung 1y agoTo put this into perspective this datacenter would have the land area of Monaco (740 acres) given assumptions of a 80kW/rack per case.
- dguest 1y agoMonaco is 2 km^2 [1]. I'm confused because if I assume each rack takes up 1 square meter I get a much smaller footprint: around 12 hectares or 17 football fields. And that assumes that the installation is one floor. I don't know much about data centers but I would have thought they'd stack them a bit. Am I the only person who had to look up how big Monaco was? [1]: https://en.wikipedia.org/wiki/Monaco https://en.wikipedia.org/wiki/Monaco [2]: https://www.wolframalpha.com/input?i=10+GW+%2F+%2880kw+%2F+m%5E2%29 https://www.wolframalpha.com/input?i=10+GW+%2F+%2880kw+%2F+m...
- zitterbewegung 1y agoMy ChatGPT calculation is below. ChatGPT is factoring in the actually size of building and a campus and it have the range of 340 to 740 acres. https://chatgpt.com/share/68d195ff-3528-8004-8418-ec462b14339f https://chatgpt.com/share/68d195ff-3528-8004-8418-ec462b1433...
- vessenes 1y agoSo, basically a single BYD factory
- oezi 1y agoMonaco is so tiny it fits into Berlin's Tempelhofer Feld (a circular park inside the city).
- ben_w 1y agoI mean, you're not wrong, but Tempelhofer is also a former airport, so had to be quite big. And since Brexit, Berlin is the biggest city in the EU.
- JCM9 1y agoThis is throwing more cards on the house of cards. Nvidia is “investing” in OpenAI so OpenAI can buy GPUs from NVidia. Textbook “round tripping.” I generally like what’s been happening with AI but man this is gonna crash hard when reality sets in. We’re reaching the scary stage of a bubble where folks are forced to throw more and more cash on the fire to keep it going with no clear path to ever get that cash back. If anyone slows down, even just a bit, the whole thing goes critical and implodes.
- zitterbewegung 1y agoI do think about this where they are creating a printing / cash burning cycle where both OpenAI keeps on doing raises and Nvidia can get more sales...
- anothermathbozo 1y agoWhat is this a bubble on? What does said bubble collapsing look like?
- Drunkfoowl 1y agoHigh end server gpus and AI roi expectations.
- reactordev 1y agoI think everyone is underestimating the advancements in wafer tech and server compute over the last decade. Easy to miss when it’s out of sight out of mind but this isn’t going anywhere but up. The current SOTA is going to pale in comparison to what we have 10 years from now.
- zer00eyz 1y ago> I think everyone is underestimating the advancements in wafer tech and server compute over the last decade. What advancements? We have done a fabulous job at lowering power consumption while exponentially increasing density of cores and to a lesser extent transistors. Delivering power to data centers was becoming a problem 20 ish years ago. Today Power density and heat generation are off the charts. Most data center owners are lowering per rack system density to deal with the "problem". There are literal projects pushing not only water cooling but refrigerant in the rack systems, in an attempt to get cooling to keep up with everything else. The dot com boom and then Web 2.0 were fueled by Mores law, by Clock doubling and then the initial wave of core density. We have run out of all of those tricks. The new steps that were putting out have increased core densities but not lowered costs (because yields have been abysmal). Look at Nvidia's latests cores, They simply are not that much better in terms of real performance when compared to previous generations. If the 60 series shows the same slack gains then hardware isnt going to come along to bail out AI --- that continues to demand MORE compute cycles (tokens on thinking anyone) rather than less with each generation.
- mrcwinn 1y agoVery foolish of them not to leverage SoftwareFPU. And with minimal effort Performas are rackable.
- paxys 1y ago> letter of intent for a landmark strategic partnership > intends to invest up to xxx progressively > preferred strategic compute and networking partner > work together to co-optimize their roadmaps > look forward to finalizing the details of this new phase of strategic partnership I don't think I have seen so much meaningless corporate speak and so many outs in a public statement. "Yeah we'll maybe eventually do something cool".
- BHSPitMonkey 1y agoNVDA's share price enjoyed a nice $6 bump today, so the announcement did what it was supposed to do. In a sense, it's just an ask to public investors for added capital to do a thing, and evidently a number of investors found the pitch compelling enough.
- paxys 1y agoIncrease in share price doesn't provide extra cash to a company. They'd have to issue new shares for that.
- hshshshshsh 1y agoBut company owns stock right? So they can sell those stocks no?
- paxys 1y agoIt can, but investors don't like that since it dilutes the value of their own shares. Which is why large companies usually do the opposite - share buybacks. Nvidia in fact bought $24 billion worth of its own shares in the first half of 2025, and plans to spend $60 billion more in buybacks in upcoming months.
- lotsofpulp 1y agoThat has to be compared with how much stock the company is “selling”, via equity compensation to employees.
- labrador 1y agoFor scale: The 1960's era US Navy submarine I served on had a 78MW reactor, so 10GW is 128 nuclear submarines
- dguest 1y agoA typical reactor core is 1 GW, so it's also one rather big nuclear power plant.
- Muromec 1y agoMore like two (and a half )
- Muromec 1y agoOr just ten very safe РБМК reactors rated 1GW each (they can't explode).
- fragmede 1y agoYou almost got me. RBMKs had this problem with large positive void coefficients that was buried by the Soviet Union, which lead to Chernobyl.
- fusionadvocate 1y agoThe control rods with the graphite on the tip was the cherry on top...
- gehsty 1y agoSome more context, Nuclear power stations can be up to 2GW, offshore windfarms are seemingly hitting a plateau at ~1.5GW, individual turbines in operations now are 15MW. Grids are already strained, 525kV DC systems can transmit ~2GW of power per cable bundle… Adding 10GW of offtake to any grid is going to cause significant problems and likely require CAPEX intensive upgrades (try buy 525kV dc cable from an established player and you are waiting until 2030+), as well as new generation for the power!
- pera 1y ago10 gigawatts sounds ridiculously high, how can you estimate the actual usage? I guess they are not running at capacity 24/7 right? Because that would be more than the consumption of several European countries, like Finland and Belgium: https://en.m.wikipedia.org/wiki/List_of_countries_by_electricity_consumption https://en.m.wikipedia.org/wiki/List_of_countries_by_electri...
- rawgabbit 1y agoDoes this affect OpenAI’s renegotiation of their deal with Microsoft?
- lvl155 1y agoWe are definitely closer to the top in this market. Do people even realize what they’re predicting in terms of energy use? It’s going to be a wasteland territory sooner than people think.
- webdevver 1y agoits going to go 10x from where it is now
- deleted 1y ago[deleted]
- cainxinth 1y agoNext Year: OpenAI announces it is seeking funding for a Dyson Sphere
- BHSPitMonkey 1y agoThe production rate of ~~paperclips~~ tokens isn't growing quickly enough!
- wiseowise 1y agoWhere do I sign? Finally back to space race instead of era of social network degradation.
- amlib 1y agoI don't think it's a good idea to have the same sociopaths who brought us the current status quo be propping up a new space race...
- pmdr 1y agoIf I had shovels to sell, I'd definitely announce a strategic partnership to have a huge quarry dug by hand. Seriously, is there anyone in the media keeping unbiased tabs on how much we're spending on summarizing emails and making creatives starve a little more?
- CodingJeebus 1y agoEd Zitron is an AI skeptic from the market perspective, highly recommend his stuff. It’s definitely not comforting to read, but he’s doing the math behind these headlines and it’s not adding up at all[0] 0: https://www.wheresyoured.at/ https://www.wheresyoured.at/
- pmdr 1y agoYeah, I pretty much agree with what he's been doing. But he's not what the average person would call 'media,' so his reach is severely limited.
- jlokier 1y agoonlyrealcuzzo wrote: > Google is pretty useful. It uses 15 TWh per year. 15TWh per year is about 1.7GW. Assuming the above figures, that means OpenAI and Nvidia new plan will consume about 5.8 Googles worth of power, by itself. At that scale, there's a huge opportunity for ultra-low-power AI compute chips (compared with current GPUs), and right now there are several very promising technology pathways to it.
- lukan 1y ago" there's a huge opportunity for ultra-low-power AI compute chips (compared with current GPUs), and right now there are several very promising technology pathways to it" Sharing an example would be nice. Of how much power reduction are we talking here?
- OtherShrezzing 1y agoThis one datacenter should be able to perform a 51% attack on any of the big cryptocurrencies with that much compute. An interesting hedge in case the AI bubble pops.
- dgfitz 1y agoKansas City shuffle?
- aurareturn 1y agoYou're downvoted but it's a real threat. Imagine hackers or state sponsored entities use one of these mega data centers to destroy a few cryptocurrencies.
- typpilol 1y agoThey are nothing compared to BTC Asics
- kevinrineer 1y agoComparing 100 duck sized horses to 1 horse sized duck. Or perhaps the amount of GPUs is in the ratio of 1,000:1.
- hangonhn 1y agoAnyone else find it fascinating that gigawatt/unit of power is the metric used for this deal?
- deleted 1y ago[deleted]
- truelson 1y agoBen Thompson and Doug O'Laughlin ( https://stratechery.com/2025/the-oracle-inflection-point-apples-price-increase/ https://stratechery.com/2025/the-oracle-inflection-point-app... (paywall), https://www.fabricatedknowledge.com/p/capital-cycles-and-ai https://www.fabricatedknowledge.com/p/capital-cycles-and-ai ) are calling it a bubble, largely because we've entered the cycle where cash flows aren't paying for it, but debt is (See Oracle. they won't be able to pay for their investment with cash flow). I think even Byrne Hobart would agree (from his interview with Ben): -- Bubbles are this weird financial phenomenon where asset prices move in a way that does not seem justified by economic fundamentals. A lot of money pours into some industry, a lot of stuff gets built, and usually too much of it gets built and a bunch of people lose their shirts and a lot of very smart, sophisticated people are involved with the beginning, a lot of those people are selling at the peak, and a lot of people who are buying at the peak are less smart, less sophisticated, but they’ve been kind of taken in by the vibe and they’re buying at the wrong time and they lose their shirts, and that’s really bad. -- This is a classic bubble. It starts, builds, and ends the same way. The technology is valuable, but it gets overbought/overproduced. Still no telling when it may pop, but remember asset values across many categories are rich right now and this could hurt.
- TheAlchemist 1y agoFolks old enough to have been around in 2000 have seen this movie before. If this was such a great business, money would be coming from outside and Nvidia would be using its profits to scale production. But they know it's not and once the bubble pops, they profit margin evaporates in months. So they keep the ball rolling - this is pretty much equivalent to buying the cards from ... themselves.
- deleted 1y ago[deleted]
- dboreham 1y agoPerpetual Money Machine
- softwaredoug 1y agoHow will this actually be powered? Just seems like we’re powering an ecological disaster.
- seydor 1y agoWe are way past peak LLM and it shows. They are basically advertise spacing heating as if it's some sort of advancement, while the tech seems to have stagnated, and they re just making the horses faster. The market should have punished this
- bwfan123 1y ago> We are way past peak LLM in the sense that all of the positive narrative is getting priced in.
- jama211 1y agoThere will be a great market correction soon. Long term though it’ll still have some value, much like after the dot com crash the internet still remained useful. I hope.
- MangoCoffee 1y ago>We are way past peak LLM and it shows The dot com bubble saw crazy deals and valuations, followed by a crash. some companies emerged from it and went on to be a giant company like Amazon. Let's hope this AI boom have some similar outcomes.
- spacebanana7 1y agoIn hindsight, the dot com bubble was really the dot com dip.
- nilkn 1y agoIt's 100% plausible and believable that there's going to be a spectacular bubble popping, but saying we are way past peak LLM would be like saying we were way past peak internet in 1999-2001 -- in reality, we weren't even remotely close to peak internet (and possibly still aren't). In fact, we were so far from the peak in 2001 that entire technological revolutions occurred many years later (e.g., smartphones) that just accelerated the pace even further in ways that would've been hard to imagine at the time. It's also important to note that AI is more than text-based LLMs -- self-driving cars and other forms of physical "embodied" AI are progressing at exponential pace, while entirely new compute form factors are only just now starting to emerge yet are almost certainly guaranteed to become pervasive as soon as possible (e.g., real AR glasses). Meanwhile, even plain-old text-based LLMs have not actually stagnated.
- danielfalbo 1y agoAnd the bubble keeps bubble-ing
- beastman82 1y agoI only have an 600W computer
- tim333 1y agoMine is using 9W according to Coconut Battery and working fine for most purposes.
- gloxkiqcza 1y agoI’m really curious how this affects the consumer GPU market over the next few years. Sure, there has been a GPU shortage for a few years now but if this continues, there should be an absolute surplus of obsolete-gen enterprise GPUs flooding the market, right? Any ideas what limitations and benefits these cards might have for an enthusiast?
- jama211 1y agoThese systems aren’t easily converted into desktop style GPU’s, so it may not trickle down the way we hope
- wmf 1y agoI assume surplus DGX A100 are already out there but they consume kilowatts so enthusiasts can't even plug them in.
- dcchambers 1y agoI feel like we're lucky Nvidia even sells consumer GPUs any more. At this point it's just a distraction to them and takes away resources they could be devoting to higher value hardware. And the data center-class hardware doesn't do well in a home environment. It's not good for gaming. It runs hot and uses a ton of energy. Not to mention, silicon that is running hot 24/7 for years probably isn't the best thing to own second hand.
- NooneAtAll3 1y agoprobably explains why we have "just rent H100 in the cloud, duh" influencers under every hardware building post on hn now
- agentultra 1y agoWater is a critical resource in dwindling supplies in many water-stressed regions. These data centers have been known to suck up water supplies during active droughts. Is there anyone left at the EPA that gets a say in how we manage water for projects like this?
- thorncorona 1y agoWe deplete our midwestern aquifers to make ethanol which we burn, and we grow almonds in California. Both of those have significantly more water impact. Both of those are significantly less useful. Why not focus on issues that matter.
- AlecSchueler 1y agoWhy either/or? This is largely a tech forum so almond crops don't need to be the big area of focus or where we as a community can offer our best knowledge/coordination.
- 34679 1y agoFood and fuel are significantly more useful than chatbots.
- fatal_errr 1y agothe e p what?
- baggachipz 1y agoThe entire premise of The Simpsons Movie is an artifact of another time. Sigh.
- deelowe 1y agoWater is much less of an issue than the media makes it out to be. It's a problem in some specific areas, yes, but power is a much better concern.
- 1y ago
- cubefox 1y agoTo the people who are calling this evidence of a bubble: There is no credible indication that AI in general is a bubble, even if not all investments will make sense in retrospect. Quite the opposite, the progress in the field over the last few years is staggering. AI systems are becoming superhuman at more and more tasks. It's only a question of time till AI will outperform us at everything.
- mikhmha 1y agoThere is no indication of being in a bubble when you're actually in one. Its only after the bubble pops do people recognize it in hindsight. Otherwise there would be no bubbles and we wouldn't see large institutions fall for this crap. What is a credible indication? Who is credible? Its all subjective. Its possible to fool yourself endlessly when financial incentives are involved. The banks did it with mortgages.
- jcranmer 1y ago> There is no credible indication that AI in general is a bubble, even if not all investments will make sense in retrospect. If you add up all of the contracts that OpenAI is signing, it's buying something like $1 trillion/year worth of compute. To merely break even, it would have to make more money than literally every other company on the planet, fairly close to twice the current highest revenue company (Walmart, a retailer, which, yeah, there's a reason that has high revenue).
- cubefox 1y agoThey are aiming at being the first to develop an AGI and eventually superintelligence. Something that can replace human workers. Walmart is small fish in comparison. OpenAI is currently in the lead, so their chances are decent.
- tptacek 1y agoThis is an argument that OpenAI needs to achieve a supernatural outcome in order to be a financial success.
- FrankyHollywood 1y ago$100 billion, what a number. It makes me a bit cynical. The amount of useful developments you could finance in either clean energy, education, nature preservation, medicine, anything. But no, let's build us a slightly better code generator. Strange times we live in...
- xyst 1y agoThis is awful. You should know the private companies building these datacenters often get back door deals with PUCs. They do NOT pay their fair share in their consumption and the extra cost is shouldered onto the general rate payers. More degenerate "privatizing of the profits, socializing the profits" behavior. American public continues to get bent by billionaires and continue to elect folks that will gladly lube them up in preparation of that event.
- elzbardico 1y agoThe good thing about this, is that when the AI bubble bursts, we will have a lot of energy infrastructure that wouldn't be built otherwise.
- JoshGlazebrook 1y agoNo one ever talks about the electricity demands for powering these things. Electric bills here in NJ via PSEG have spiked over 50% and they are blaming increased demand from datacenters, yet they don't seem to charge datacenters more? https://www.datacenterdynamics.com/en/news/new-jersey-utility-pseg-sees-large-load-pipeline-surge-to-94gw-90-from-data-centers/ https://www.datacenterdynamics.com/en/news/new-jersey-utilit...
- lotsofpulp 1y agoThat is on NJ government for allowing the price increases. They can easily say no.
- bigwheels 1y agoA classic political games move, and it says more about how much anti-consumer nonsense is tolerated in New Jersey than it does about power generation and distribution pricing realities. The data centers will naturally consolidate in areas with competitive electricity pricing.
- Gud 1y agoDefine, "competitive electricity pricing". Because surely this will make the electricity prices less competitive for the you and me...
- m101 1y agoThis is called marginal pricing. Everyone pays the price of the marginal producer. In some cases they try to get the data centres to pay for their infrastructure costs but the argument is that customers don't pay this normally but do so through usage fees over time.
- ComputerGuru 1y agoFraming it in gigawatts is very interesting given the controversy about skyrocketing electric prices for residential and small business users as a result of datacenters over the past three years, primarily driven by AI growth. If, as another commenter notes, this 10GW is how much Chicago and NYC use combined, then we need to have a serious discussion about where this power is going to come from given the dismal status of the USA's power grid and related infrastructure and the already exploding costs that have been shifted to residential users in order to guarantee electric supply to these biggest datacenters (so they can keep paying peanuts for electricity and avoid shouldering any of the infrastructural burden to maintain or improve the underlying grid/plants required to meet their massive power needs). I'm not even anti-datacenter (wouldn't be here if I were), I just think there needs to be serious rebalancing of these costs because this increase in US residential electric prices in just five years (from 13¢ to 19¢, a ridiculous 46% increase) is neither fair nor sustainable. So where is this 10GW electric supply going to come from and who is going to pay for it? Source: https://fred.stlouisfed.org/series/APU000072610 https://fred.stlouisfed.org/series/APU000072610 EDIT: To everyone arguing this is how DCs are normally sized: yes, but normally it's not the company providing the compute for the DC owner that is giving these numbers. nVidia doesn't sell empty datacenters with power distribution networks, cooling, and little else; nVidia sells the GPUs that will stock that DC. This isn't a typical PR netnewswire bulletin "OpenAI announces new 10GW datacenter", this is "nvidia is providing xx compute for OpenAI". Anyway, all this is a segue from the question of power supply, consumption, grid expansion/stability, and who is paying for all that.
- gitpusher 1y ago> Framing it in gigawatts is very interesting given the controversy Exactly. When I saw the headline I assumed it would contain some sort of ambitious green energy build-out, or at least a commitment to acquire X% of the energy from renewable sources. That's the only reason I can think to brag about energy consumption
- 7952 1y agoOr this brings power and prestige to the country that hosts it. And it gives clout precisely because it is seemingly wasteful. Finding the energy is a problem for the civilian government who either go "drill baby drill" or throw wind/solar/nuclear at the problem.
- 0xTJ 1y agoStating compute scale in terms of power consumption is such a backwards metric to me, assuming that you're trying to portray is as something positive. It's like selling steel by the average fractional number of mining deaths that went into producing it. Sure, at a given moment there will be some ratio between average deaths and steel, but that's a number that you want to be as low as possible.
- dmoy 1y agoStating compute scale in terms of power consumption is exactly how one looks at data centers or capacity planning right now though. It's the major constraint. It's just a different abstraction level.
- brendoelfrendo 1y agoWhere does this fit in with the $300 billion partnership between OpenAI and Oracle? You know, the one that also hasn't happened yet and catapulted Oracle's stock price through the stratosphere last week? Is that also getting built or is OpenAI partnering with Nvidia to get access to the GPUs that neither they nor Oracle currently own?
- shmerl 1y agoThey should spend gigawatts on something more useful instead.
- fennecbutt 1y agoI do think that us humans are gonna cook ourselves on this planet. However at least AI is doing _something_ with the energy. Cryptocurrency is such a fucking useless waste of energy I'd take anything over it.
- sheerun 1y ago<3
- OhioMan2943 1y ago"Hey, there's a bubble"
- pyrophane 1y agoSo Nvidia is giving OpenAI money so OpenAI can buy more Nvidia GPUs?
- 2sk21 1y agoTelecom vendors were doing exactly this before the dotcom crash of 2000
- deleted 1y ago[deleted]
- Brysonbw 1y agoThe infrastructure and energy required to power these systems at scale are critical. I hope we carefully consider the environmental impact of building and operating data centers. I’m optimistic that we will develop efficient and sustainable solutions to power the data centers of today and the future
- rippeltippel 1y agoLife was so much cheaper in the '80, when you could travel in time with just 1.21GW.
- zmmmmm 1y agothere's a worrying lack of structural integrity building up in this hype bubble and this adds more fuel to the fire. You essentially have Nvidia propping up its own valuation here by being its own customer. If they sold a bunch of H100's to themselves and then put it as revenue on their books they'd be accused of fraud. Doing it this way is only slightly better.
- gessha 1y agoI feel like data center deployments is the new metric that companies choose to show growth vs the old headcount growth.
- mrheosuper 1y agoThe Earth become warmer, and we spend a lot of money to make it 10GW faster warming.
- mrheosuper 1y agoi am wondering do they still use 48v in those computers ? That's a lot of amp.
- nicman23 1y agoso like 3 racks of h100?
- gorbypark 1y agoThat's a lot. I always had this idea in the back of my mind that British Columbia should get in on the AI game and try and get data centers located in BC because we generally have a lot of "excess" hydro generation capacity. There's a new mega dam recently opened that had lots of criticism about it being "unneeded". That mega dam (Site C) produces 1.1GW of energy.
- andirk 1y agoMost salient point of all of this: gigawatts is pronounced "jigga watts", like Back to the Future's Doc does correctly.
- rvz 1y agoThis is a dot-com level bubble.
- tim333 1y agoDotcom++
- StapleHorse 1y agoI wonder if all that heat could be harvested and reused in turbines. Maybe using industrial scale heat pumps. I don't know.