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I couldn’t find the 1000b number, but if that is “ai buildout capex” that means you think that 67% of every dollar spent on building data centers, training mode
by kennywinker 2mo ago
I couldn’t find the 1000b number, but if that is “ai buildout capex” that means you think that 67% of every dollar spent on building data centers, training models, and running inference, is going directly to nvidia.
Which is just silly on the face of it. Data centers need concrete, copper, DRAM, SSDs, and labour. That alone will cost more than 33%.
- lostlogin 2mo ago> Data centers need concrete, copper, DRAM, SSDs, and labour. That alone will cost more than 33%. Surely the land is a double digit percentage of their budget? I know they build in the middle of nowhere, but even then.
- chermi 2mo agoYeah but remember 1) stuff gets more expensive the more it's "processed"/further up the chain. It's hard to think of something further up the value chain than a modern gpu server. Just look at one input, asml machines. 2) a lot of dram, labor etc is also baked into the gpus.
- kennywinker 2mo agoSure. Obviously GPUs are expensive. My computer is more expensive and more processed than a 2x4, but that doesn't mean that my computer is a significant percentage of the value of my house. And it's pretty unclear what is included in the "capital expenditure" numbers. E.g. does it include training costs? does it include research costs? etc.
- chermi 2mo agoI'm not sure. I think they count training as R&D? Hopefully we learn just they're doing their accounting with anthropic ipo
- vb-8448 2mo agoMaybe 67% is too much, but the GPUs are the most expensive thing in all those datacentres. Anyway, according to the latest articles[0], 1000B is the lower bound. [0] https://sg.finance.yahoo.com/news/ai-infrastructure-investment-exceed-1-120000797.html https://sg.finance.yahoo.com/news/ai-infrastructure-investme...
- kennywinker 2mo agoThe most expensive thing in my house isn't even 1% of the value of my house and everything in it.
- vb-8448 2mo agoImagine a house full of racks of gpus!
- vb-8448 2mo agoImagine a house full of racks of gpus!
- kennywinker 2mo agoI can imagine that. I could probably fit more GPUs in my closet than the cost of my house. Now imagine adding a complex liquid cooling system to my house, upgrading the wiring to support the extra power draw, and some full time staff to maintain the space and keep the GPUs running. Wouldn't be hard to switch the balance back away from GPUs toward the infrastructure around them. And let's also imagine I include my massive GPU usage bill in the house column. And while we're at it let's also include my full time staff of researchers in the house column.
- vb-8448 2mo agoNo way staff, complex liquid cooling and everything else is going to cost more than the hardware itself. All articles that I found on "ai datacenters cost breakdown" say that >60% is for the HW inside.
- Jlagreen 2mo agoI suggest looking into Nvidia's DGX and DSX systems. Basically, everything of a data center except for RAM+SSD comes now from Nvidia as a vendor. Nvidia's margin is so high because they deliver way more than just a GPU.