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Nvidia’s $589B DeepSeek rout

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Re: Nvidia’s $589B DeepSeek rout

#561

Post by addicted »

ozten wrote: post #431

NVIDIA sells shovels to the gold rush. One miner (Liang Wenfeng), who has previously purchased at least 10,000 A100 shovels... has a "side project" where they figured out how to dig really well with a shovel and shared their secrets. The gold rush, wether real or a bubble is still there! NVIDA will still sell every shovel they can manufacture, as soon as it is available in inventory. Fortune 100 companies will still…

What you are missing is that it turns out the gold isn’t actually gold. It’s bronze.

So earliest, the shovelers were willing to spend thousands of dollars for a single shovel because they were expecting to get much more valuable gold out the other end.

But now that it’s only bronze, they can’t spend that much money on their tools anymore to make their venture profitable. A lot of shovelers are gonna drop out of the race. And the ones that remain will not be willing to spend as much.

The fact that there isn’t that much money to be made in AI anymore means that whatever percentage of money would have gone to NVIDIA from the total money to be made in AI will now shrink dramatically.

Re: Nvidia’s $589B DeepSeek rout

#562

Post by eigenvalue »

sekai wrote: post #87
fancyfredbot wrote: post #31

The people writing market commentary are simply making it up. The news about DeepSeek is not new and doesn't reduce the value of ASML. People are selling now because they are scared because the number went down.

Andrej Karpathy was tweeting about DeepSeek a month (!) ago. "DeepSeek (Chinese AI co) making it look easy today with an open weights release of a frontier-grade LLM trained on a joke of a budget (2048 GPUs for 2 months, $6M)." https://x.com/karpathy/status/1872362712958906460

Yes exactly. The actual impetus this time was the article I posted here and how it got echoed and amplified by massive X accounts like Chamath and Naval.

Re: Nvidia’s $589B DeepSeek rout

#563

Post by Rury »

puppymaster wrote: post #549
elihu wrote: post #450

Earlier quoted context omitted.

Jevon's paradox would imply that there's good reason to think that demand for shovels will increase. AI doesn't seem to be one of those things where society as a whole will say, "we have enough of that; we don't need any more". (Many individual people are already saying that, but they aren't the people buying the GPUs for this in the first place. Steam engines weren't universally popular either when they were introdu…

I also dont get how this is bearish for NVDA. Before this, small to mid companies would give up on finetuning their own model because openai is just so much better and cheaper. Now deepseek SOTA model gives them much better quality baseline model to train on. Wouldn't more people want to RAG on top of deepseek? or some startups accountant would run the numbers and figures we can just inference the shit out of deepsee…

Maybe because the loudest news said it was bearish. Lot's of people let the media do their thinking for them.

Re: Nvidia’s $589B DeepSeek rout

#564

Post by theptip »

chatmasta wrote: post #550
kd913 wrote: post #394

The biggest discussion I have been on having this is the implications on Deepseek for say the RoI H100. Will a sudden spike in available GPUs and reduction in demand (from efficient GPU usage) dramatically shock the cost per hour to rent a GPU. This I think is the critical value for measuring the investment value for Blackwell now. The price for a H100 per hour has gone from the peak of $8.42 to about $1.80. A H100 c…

Why is there this implicit assumption that more efficient training/inference will reduce GPU demand? It seems more likely - based on historical precedent in the computing industry - that demand will expand to fill the available hardware. We can do more inference and more training on fewer GPUs. That doesn’t mean we need to stop buying GPUs. Unless people think we’re already doing the most training/inference we’ll eve…

I think training demand is what you might predict would plummet.

Inference demand might increase but you could easily believe that there’s substantial inelasticity currently.

Re: Nvidia’s $589B DeepSeek rout

#565

Post by yalogin »

Nvidia has gotten lucky repeatedly. The GPUs were great for PC gaming and they were the top dog. The crypto boom was such an unexpected win for them partly because Intel killed off their competition by acquiring it. Then the AI boom is also a direct result of Intel killing off their competition but the acquisition is too far removed to credit it to that event.

Unlike the crypto boom though, two factors make me think the AI thing was bound to go away quickly.

Unlike crypto there is no mathematical lower bound for computation, and if you see technology's history we can tell the models are going to get better/smaller/faster overtime reducing our reliance on the GPU.

Crypto was fringe but AI is fundamental to every software stack and every company. There is way too much money in this to just let Nvidia take it all. One way or another the reliance on it will be reduced

Re: Nvidia’s $589B DeepSeek rout

#566

Post by Barrin92 »

trhway wrote: post #558
jcgrillo wrote: post #522

Earlier quoted context omitted.

> AI doesn't seem to be one of those things where society as a whole will say, "we have enough of that; we don't need any more". Really? Has anyone made a useful, commercially successful product with it yet?

>Really? Has anyone made a useful, commercially successful product with it yet? Aren't millions or even tens of millions students using ChatGPT for example? To me that sounds like a commercial success (and looks comparable with the usage of Google Search - a money printing machine for more almost 30 years now - in the first years) And enterprise-wise - heard recently a VP complaining about entering expenses. As we do…

>To me that sounds like a commercial success

It isn't because it's not making them any money. Having users doesn't mean you have a business. If you sell two dollars for one dollar having more users is not a blessing financially. Of course you could slap ads on it, like Google, but unlike Google openAI has no moat and there's already ten competitors. Competition eliminates profit and AI is being commoditized faster than pretty much anything else.

Re: Nvidia’s $589B DeepSeek rout

#568

Post by chatmasta »

Jensson wrote: post #552
chatmasta wrote: post #550

Earlier quoted context omitted.

Why is there this implicit assumption that more efficient training/inference will reduce GPU demand? It seems more likely - based on historical precedent in the computing industry - that demand will expand to fill the available hardware. We can do more inference and more training on fewer GPUs. That doesn’t mean we need to stop buying GPUs. Unless people think we’re already doing the most training/inference we’ll eve…

Historically most compute went to run games in peoples homes, because companies didn't see a need to run that much analytics. I don't see why that wouldn't happen now as well, there is a limit to how much value you can get out of this, since they aren't AGI yet.

This just seems like a very bold statement to make in the first two years of LLMs. There are so many workflows where they are either not yet embedded at all, or only involved in a limited capacity. It doesn’t take much imagination to see the areas for growth. And that’s before even considering the growth in adoption. I think it’s a safe bet that LLM usage will proliferate in terms of both number of users, and number of inferences per user. And I wouldn’t be surprised if that growth is exponential on both those dimensions.

Re: Nvidia’s $589B DeepSeek rout

#569

Post by deeviant »

addicted wrote: post #561
ozten wrote: post #431

NVIDIA sells shovels to the gold rush. One miner (Liang Wenfeng), who has previously purchased at least 10,000 A100 shovels... has a "side project" where they figured out how to dig really well with a shovel and shared their secrets. The gold rush, wether real or a bubble is still there! NVIDA will still sell every shovel they can manufacture, as soon as it is available in inventory. Fortune 100 companies will still…

What you are missing is that it turns out the gold isn’t actually gold. It’s bronze. So earliest, the shovelers were willing to spend thousands of dollars for a single shovel because they were expecting to get much more valuable gold out the other end. But now that it’s only bronze, they can’t spend that much money on their tools anymore to make their venture profitable. A lot of shovelers are gonna drop out of the r…

Wait, so AI might become 25x cheaper to train and run, and your thesis is... no one will make money on AI now?!?!

Re: Nvidia’s $589B DeepSeek rout

#570

Post by kibibu »

polygamous_bat wrote: post #223
plaidfuji wrote: post #160

The part of this that doesn’t jibe with me is the fact that they also released this incredibly detailed technical report on their architecture and training strategy. The paper is well-written and has a lot of specifics. Exactly the opposite of what you would do if you had truly made an advancement of world-altering magnitude. All this says to me is that the models themselves have very little intrinsic value / are hig…

> The part of this that doesn’t jibe with me is the fact that they also released this incredibly detailed technical report on their architecture and training strategy. The paper is well-written and has a lot of specifics. Exactly the opposite of what you would do if you had truly made an advancement of world-altering magnitude. I disagree completely on this sentiment. This was in fact the trend for a century or more…

Even the "Language Models are Unsupervised Multitask Learners" paper was pretty open; I'd say even more open than the R1 paper.
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