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The impact of competition and DeepSeek on Nvidia

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Re: The impact of competition and DeepSeek on Nvidia

#351

Post by WalterBright »

nyrikki wrote: post #312
fairity wrote: post #270

Earlier quoted context omitted.

I think it's worth double clicking here. Why did Google have significantly better search results for a long time? 1) There was a data flywheel effect, wherein Google was able to improve search results by analyzing the vast amount of user activity on its site. 2) There were real economies of scale in managing the cost of data centers and servers 3) Their advertising business model benefited from network effects, where…

You are forgetting a bit, I worked in some of the large datacenters where both Google and Yahoo had cages. 1) Google copied the hotmail model of strapping commodity PC components to cheap boards and building software to deal with complexity. 2) Yahoo had a much larger cage, filled with very very expensive and large DEC machines, with one poor guy sitting in a desk in there almost full time rebooting the systems etc..…

> I hope he has any hearing left today

I opted for a fanless graphics board, for just that reason.

Re: The impact of competition and DeepSeek on Nvidia

#352

Post by fspeech »

gamblor956 wrote: post #337
UncleOxidant wrote: post #309

Even if DeepSeek has figured out how to do more (or at least as much) with less, doesn't the Jevons Paradox come into play? GPU sales would actually increase because even smaller companies would get the idea that they can compete in a space that only 6 months ago we assumed would be the realm of the large mega tech companies (the Metas, Googles, OpenAIs) since the small players couldn't afford to compete. Now that st…

Important to note: the $5 million alleged cost is just the cpu compute cost for the final version of the model; it's not the cumulative cost of the research to date. The analogous costs would be what OpenAI spent to go from GPT 4 to GPT 4o (i.e., to develop the reasoning model from the most up-to-date LLM model). $5 million is still less than what OpenAI spent but it's not a magnitude lower. (OpenAI spent up to $100…

It doesn't make sense to compare individual models. A better way is to look at total compute consumed, normalized by the output. In the end what counts is the cost of providing tokens.

Re: The impact of competition and DeepSeek on Nvidia

#353

Post by UncleOxidant »

yifanl wrote: post #348
aurareturn wrote: post #326

Earlier quoted context omitted.

If demand for AI chips will increase due to Jevon’s paradox, why would Nvidia’s chips become cheaper? In the long run, yes, they will be cheaper due to more competition and better tech. But next month? It will be more expensive.

The usage of existing but cheaper nvidia chips to make models of similar quality is the main takeaway. It'll be much harder to convince people to buy the latest and greatest with this out there.

The sweet spot for running local LLMs (from what I'm seeing on forums like r/localLlama) is 2 to 4 3090s each with 24GB of VRAM. NVidia (or AMD or Intel) would clean up if they offered a card with 3090 level performance but with 64GB of VRAM. Doesn't have to be the leading edge GPU, just a decent GPU with lots of VRAM. This is kind of what Digits will be (though the memory bandwidth is going to be slower with because it'll be DDR5) and kind of what AMD's Strix Halo is aiming for - unified memory systems where the CPU & GPU have access to the same large pool of memory.

Re: The impact of competition and DeepSeek on Nvidia

#354

Post by lokar »

munksbeer wrote: post #347
onlyrealcuzzo wrote: post #331

Earlier quoted context omitted.

No - because this eliminates entirely or shifts the majority of work from GPU to CPU - and Nvidia does not sell CPUs. If the AI market gets 10x bigger, and GPU work gets 50% smaller (which is still 5x larger than today) - but Nvidia is priced on 40% growth for the next ten years (28x larger) - there is a price mismatch. It is theoretically possible for a massive reduction in GPU usage or shift from GPU to CPU to bene…

I can see close to zero possibility that the majority of the work will be shifted to the CPU. Anything a CPU can do can just be done better with specialised GPU hardware.

People have been saying the exact same thing about other workloads for years, and always been wrong. Mostly claiming custom chips or FPGAs will beat out general purpose CPUs.

Re: The impact of competition and DeepSeek on Nvidia

#355

Post by WhitneyLand »

paulddraper wrote: post #283
pjdesno wrote: post #176

The description of DeepSeek reminds me of my experience in networking in the late 80s - early 90s. Back then a really big motivator for Asynchronous Transfer Mode (ATM) and fiber-to-the-home was the promise of video on demand, which was a huge market in comparison to the Internet of the day. Just about all the work in this area ignored the potential of advanced video coding algorithms, and assumed that broadcast TV-q…

I love algorithms as much the next guy, but not really. DCT was developed in 1972 and has a compression ratio of 100:1. H.264 compresses 2000:1. And standard resolution (480p) is ~1/30th the resolution of 4k. --- I.e. Standard resolution with DCT is smaller than 4k with H.264. Even high-definition (720p) with DCT is only twice the bandwidth of 4k H.264. Modern compression has allowed us to add a bunch more pixels, bu…

DCT is not an algorithm at all, it’s a mathematical transform.

It doesn’t have a compression ratio.

Re: The impact of competition and DeepSeek on Nvidia

#356

Post by eigenvalue »

pjdesno wrote: post #176

The description of DeepSeek reminds me of my experience in networking in the late 80s - early 90s. Back then a really big motivator for Asynchronous Transfer Mode (ATM) and fiber-to-the-home was the promise of video on demand, which was a huge market in comparison to the Internet of the day. Just about all the work in this area ignored the potential of advanced video coding algorithms, and assumed that broadcast TV-q…

Yes, that is a very apt analogy!

Re: The impact of competition and DeepSeek on Nvidia

#357

Post by moralestapia »

dplgk wrote: post #250
aurareturn wrote: post #233

Earlier quoted context omitted.

This is wrong. First mover advantage is strong. This is why OpenAI is much bigger than Mixtral despite what you said. First mover advantage acquired and keeps subscribers. No one really cares if you matched GPT4o one year later. OpenAI has had a full year to optimize the model, build tools around the model, and used the model to generate better data for their next generation foundational model.

What is OpenAI's first-mover moat? I switched to Claude with absolutely no friction or moat-jumping.

*sigh*

This broken record again.

Just observe reality. OpenAI is leading, by far.

All these "OpenAI has no moat" arguments will only make sense whenever there's a material, observable (as in not imaginary), shift on their market share.

Re: The impact of competition and DeepSeek on Nvidia

#358

Post by tomrod »

onlyrealcuzzo wrote: post #203
tomrod wrote: post #158

Earlier quoted context omitted.

Conversely, how much larger can you scale if frontier models only currently need 3 consumer computers? Imagine having 300. Could you build even better models? Is DeepSeek the right team to deliver that, or can OpenAI, Meta, HF, etc. adapt? Going to be an interesting few months on the market. I think OpenAI lost a LOT in the board fiasco. I am bullish on HF. I anticipate Meta will lose folks to brain drain in response…

If you watch this video, it explains well what the major difference is between DeepSeek and existing LLMs: https://www.youtube.com/watch?v=DCqqCLlsIBU It seems like there is MUCH to gain by migrating to this approach - and it theoretically should not cost more to switch to that approach than vs the rewards to reap. I expect all the major players are already working full-steam to incorporate this into their stacks as…

That is a fantastic video, BTW.

Re: The impact of competition and DeepSeek on Nvidia

#359

Post by corimaith »

coliveira wrote: post #235
rightbyte wrote: post #217

Earlier quoted context omitted.

There seem to be a 100 fold uptick in jingoists in the last 3-4 years which makes my head hurt but I think there is no consistent "underestimation" in academic circles? I think I have read articles about the up and coming Chinese STEM for like 20 years.

Yes, for people in academia the trend is clear, but it seems that WallStreet didn't believe this was possible. They assume that spending more money is all you need to dominate technology. Wrong! Technology is about human potential. If you have less money but bigger investment in people you'll win the technological race.

What does DeepSeek or really High Flyer do that is particularly exceptional regarding employees? HFT and other elite law or Hedge funds are known to have pretty zany benefits.

Re: The impact of competition and DeepSeek on Nvidia

#360

Post by corimaith »

11101010001100 wrote: post #214
tw1984 wrote: post #200

Earlier quoted context omitted.

> DeepSeek just further reinforces the idea that there is a first-move disadvantage in developing AI models. you are assuming that what DeepSeek achieved can be reasonably easily replicated by other companies. then the question is when all big techs and tons of startups in China and the US are involved, how come none of those companies succeeded? deepseek is unique.

Deepseek is unique, but the US has consistently underestimated Chinese R&D, which is not a winning strategy in iterated games.

That doesn't the calculus regarding the actions you would pick externally, in fact it only strengthens the point for increased tech restrictions and more funding.
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