Discussion
So I’ve read different articles that are talking about the taker or pay obligations on AI companies have signed up for with hyper scalers contingent on data center construction, reaching completion.
And that those obligations will show up on AI company books as data centers or if data centers come online. The total obligation runs maybe $2 trillion.
But there’s no way data centers can be completed on anything like announced schedules
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@GhostOnTheHalfShell yeah, it's all going to fall over and it'll be a financial disaster!
The $2 trillion of take or pay commitments only become active as data centers come online and they can’t. One aspect of the financial disaster I don’t think can emerge it’s going to happen with the hyper scaler certainly.
It’s hard to know if failure of data center completion simply takes that obligation overhead and shift sit onto the hyper scalers because their own debt obligations are contingent on these contracts.
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@davidgerard
There isn’t the water for it. There isn’t the electrical resources and there is a five-year waiting list for gas turbines in that kind of thing.
So even though there’s this gigantic payment obligation overhang they have committed to yet if they actually had to pay up, it’s a debt overhang that’s twice as large as 2008.
But that obligation will not come online. It’s a little bit like the failure is “saving our bacon”
Do you have any thoughts?
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