#ai #bubble: nvidia "investing" $100bn in OpenAI ("by gigawatt", i.e. they probably just hand out their hardware for free, for the promise of later payment + some kind of interest) reminds me of Sun in 2000. They "sold" their flagship systems the same way: every other "dot-com" startup in those days had their very own Sun E10k somewhere, with a payment plan over the next few years.
And then the bubble burst. Of course, Sun could probably claw all those systems back, but that doesn't pay the bills. They could resell them, but to whom in a market that _suddenly_ grew ice cold? They could wait to sell them, but at that time, these boxes depreciated so fast since computing ability still grew exponentially along pretty much every metric (per Watt, per mm^2, per $)
They never recovered, and while the Sun Microsystems of old still has a place in my heart, they sold themselves to Oracle in 2010 (boo!).
Now, nvidia plays basically the same game: put out their hardware in a get-it-now-pay-later scheme. If or when the recipients of that hardware fold and we're entering the next AI winter (it can't come soon enough IMNSHO), what will they do with the unpaid surplus? https://gpus.axiomgaming.net/GPU-Performance-Analytics hasn't flattened yet, even if it doesn't look as ridiculous as the performance curves in the 2000s. With that they have only a relatively small window in which they can hope to recover.
