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IBM CEO says there is 'no way' spending on AI data centers will pay off

businessinsider.com

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Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#121

Post by lithos »

Octoth0rpe wrote: post #18

> Krishna also referenced the depreciation of the AI chips inside data centers as another factor: "You've got to use it all in five years because at that point, you've got to throw it away and refill it," he said This doesn't seem correct to me, or at least is built on several shaky assumptions. One would have to 'refill' your hardware if: - AI accelerator cards all start dying around the 5 year mark, which is possib…

It's worse than that in reality, AI chips are on a two year cadence for backwards compatibility (NVIDIA can basically guarantee it, and you probably won't be able to pay real AI devs enough to stick around to make hardware work arounds). So their accounting is optimistic.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#123

Post by rahimnathwani »

coliveira wrote: post #113
kenjackson wrote: post #94

Earlier quoted context omitted.

The article says, "Kirshna said that it takes about $80 billion to fill up a one-gigawatt data center." But thanks for you insight -- I used your basic idea to estimate and for 1GW it comes to about $30b just for enough GPU power to pull 1GW. And of course that doesn't take into account any other costs. So $80b for a GW datacenter seems high, but it's within a small constant factor. That said, power seems like a weir…

> power seems like a weird metric to use Because this technology changes so fast, that's the only metric that you can control over several data centers. It is also directly connected to the general capacity of data center, which is limited by available energy to operate.

And cooling capacity.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#124

Post by rlupi »

Octoth0rpe wrote: post #18

> Krishna also referenced the depreciation of the AI chips inside data centers as another factor: "You've got to use it all in five years because at that point, you've got to throw it away and refill it," he said This doesn't seem correct to me, or at least is built on several shaky assumptions. One would have to 'refill' your hardware if: - AI accelerator cards all start dying around the 5 year mark, which is possib…

Do not forget that we're talking about supercomputers. Their interconnect makes machines not easily fungible, so even a low reduction in availability can have dramatic effects.

Also, after the end of the product life, replacement parts may no longer be available.

You need to get pretty creative with repair & refurbishment processes to counter these risks.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#125

Post by holsta »

_menelaus wrote: post #116
armitron wrote: post #96

Earlier quoted context omitted.

[flagged]

[flagged]

Many experiments have shown that when you take away people's concerns about money for housing and food, that frees up energy and attention to do other things.

Like the famous experiment in Finland where homeless people were given cash with no strings attached and most were able to rise out of their despair. The healthcare professionals could then focus their energy on the harder cases. It also saved a bunch of money in the process.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#126

Post by NedF »

scroot wrote: post #24

As an elder millennial, I just don't know what to say. That a once in a generation allocation of capital should go towards...whatever this all will be, is certainly tragic given current state of the world and its problems. Can't help but see it as the latest in a lifelong series of baffling high stakes decisions of dubious social benefit that have necessarily global consequences.

[dead]

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#127

Post by panick21_ »

542354234235 wrote: post #119
panick21_ wrote: post #73

Earlier quoted context omitted.

I'm not saying you are wrong that some redistribution can be good, but your analysis is simplistic and ignores many factors. You can just redistribute and then say 'well people will spend the money'. That's literally the 'Broken Window' fallacy from economics. You are ignoring that if you don't redistribute it, money also gets spend, just differently. Also, the central bank is targeting AD, so you're not actually inc…

Take a million dollars, give 1,000 poor people $1,000 and every dollar will be spent on goods and services. The companies running those services and making those goods will need to have their employees work more hours, putting more money back in poor people’s pockets in addition to the money the companies make. Those employees have a few extra dollars to spend on goods and services, etc. Give a rich person a million…

You are simply disagreeing with 99% of economists.

Money in tax shelter doesn't go threw a portal in another universe. Its either invested or saved as some kind of asset and in that form is in circulation. And again, even if you assume it increases monetary demand (decreases velocity) the central bank targets AD and balances that out.

Based on your logic, a country that taxes 100% of all income and redistrubtes it would become infinity rich. Your logic is basically 'if nobody saves and everybody spends all income' everybody will be better off.

This is not how the economy works even if it feels good to think that. Its a fallacy.

Where you could have a point is that potentially the tax impact is slightly different, but that's hard to prove.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#128

Post by panick21_ »

coliveira wrote: post #90
panick21_ wrote: post #73

Earlier quoted context omitted.

I'm not saying you are wrong that some redistribution can be good, but your analysis is simplistic and ignores many factors. You can just redistribute and then say 'well people will spend the money'. That's literally the 'Broken Window' fallacy from economics. You are ignoring that if you don't redistribute it, money also gets spend, just differently. Also, the central bank is targeting AD, so you're not actually inc…

There are many ways of spending money in the population that don't include just "distribution of money", as it's portrayed nowadays. Child care, free and high quality schools, free transportation, free or subsidized healthcare, investment is labor-intensive industries, these are all examples of expenditures that translate in better quality of life and also improve competitiveness for the country.

That has literally nothing to do with the point I have argued.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#129

Post by Atheros »

PrairieFire wrote: post #34
scroot wrote: post #24

As an elder millennial, I just don't know what to say. That a once in a generation allocation of capital should go towards...whatever this all will be, is certainly tragic given current state of the world and its problems. Can't help but see it as the latest in a lifelong series of baffling high stakes decisions of dubious social benefit that have necessarily global consequences.

agree the capital could be put to better use, however I believe the alternative is this capital wouldn't have otherwise been put to work in ways that allow it to leak to the populace at large. for some of the big investors in AI infrastructure, this is cash that was previously and likely would have otherwise been put toward stock buybacks. for many of the big investors pumping cash in, these are funds deploying the w…

> likely would have otherwise been put toward stock buybacks

Stock buybacks from who? When stock gets bought the money doesn't disappear into thin air; the same cash is now in someone else's hands. Those people would then want to invest it in something and then we're back to square one.

You assert that if not for AI, wealth wouldn't have been spent on materials, land, trades, ect. But I don't think you have any reason to think this. Money is just an abstraction. People would have necessarily done something with their land, labor, and skills. It isn't like there isn't unmet demand for things like houses or train tunnels or new-fangled types of aircraft or countless other things. Instead it's being spent on GPUs.

Re: IBM CEO says there is 'no way' spending on AI data centers will pay off

#130

Post by panick21_ »

QuercusMax wrote: post #88
panick21_ wrote: post #73

Earlier quoted context omitted.

I'm not saying you are wrong that some redistribution can be good, but your analysis is simplistic and ignores many factors. You can just redistribute and then say 'well people will spend the money'. That's literally the 'Broken Window' fallacy from economics. You are ignoring that if you don't redistribute it, money also gets spend, just differently. Also, the central bank is targeting AD, so you're not actually inc…

Stock buybacks don't build anything. They're just a way to take money from inside a company and give it to the shareholders.

I don't know what that has to do with the point discussed.

Do you think shareholder don't spend money, but employees do or something?

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