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Nvidia's Risky Business

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Re: Nvidia's Risky Business

#41

Post by cmiles8 »

CodesInChaos wrote: post #28
cmiles8 wrote: post #20

Nothing goes up and to the right forever. Nothing. Building a business model on the belief that “this time is different” always finds storms on the horizon.

A lot of things go up forever, as long as you denominate them in an inflationary currency ;-)

There’s a massive difference between “going up forever” and “point B is higher than point A.”

The current setup can’t sustain a downturn, even if yes 20 years from now point B is likely to be higher than present.

That’s the danger. Those that are going to get wiped out by the AI bubble burst aren’t wrong about AI being huge long term, they just put themselves in a position to not survive the storms that happen between points A and B.

Re: Nvidia's Risky Business

#42

Post by synergy20 »

pletnes wrote: post #40
dzonga wrote: post #36

Nvidia has been playing a dangerous but profitable game since the Crypto boom. but now I think they probably have bitten more than they can chew. Apple already proved with their unified memory - that as long you have the capacity you can run capable models locally - thereby goes demand for inference if everyone is running some model locally. For training - Chinese models have proved that you don't need the latest & g…

Nvidia sell iot boards with unified architecture. Would not be shocked if they launch pc/laptop/server boards at some point.

that undercuts their core business, so it will be a defensive play at most to fend off mac and amd's local inference offerings

Re: Nvidia's Risky Business

#43

Post by 2OEH8eoCRo0 »

dzonga wrote: post #36

Nvidia has been playing a dangerous but profitable game since the Crypto boom. but now I think they probably have bitten more than they can chew. Apple already proved with their unified memory - that as long you have the capacity you can run capable models locally - thereby goes demand for inference if everyone is running some model locally. For training - Chinese models have proved that you don't need the latest & g…

What's the danger? They slide back down to being just a gaming graphics card company with a $10 share price?

Re: Nvidia's Risky Business

#44

Post by ekunazanu »

mattnewton wrote: post #33
onlyrealcuzzo wrote: post #21

Earlier quoted context omitted.

What makes this insanely hard to predict is that the compute needed for the same quality output has roughly gone down 90% every 18 months for ~5 years. 1) We don't know how long that trend will continue, but you do know where to look for when it may end (if smaller sized models continue to compress the knowledge effectively of larger models). 2) We don't know when the appetite for higher cost models might go down and…

I think efficiency is unlikely to result in lower demand for compute, instead more useful compute per watt increases the value of that compute; and we are not going to run out of economically useful things to do with it anytime soon on the demand side. The harder thing to forecast for me is if we hit a wall on increasing efficiency, either on the model weights side or silicon side, with current approaches. If we have…

I agree; I don't think there's any reason to assume Jevons paradox won't apply.

> If we have to switch to something like burning the model weights into silicon to continue to make gains

I think that's already being considered semi-seriously [0][1]

[0] https://taalas.com/products/

[1] https://ir.amd.com/news-events/press-releases/detail/1296/am...

Re: Nvidia's Risky Business

#45

Post by zaphar »

dh2022 wrote: post #37

[flagged]

He was referencing a book that made that case if you "squint". If you read that as actually a serious "this caused world war 1" statement rather than. This looks to have gotten some dominoes rolling that may have contributed to WW1 then that says more about you than it does about the article itself.

Re: Nvidia's Risky Business

#47

Post by yaportmax »

KaiMagnus wrote: post #27

IMO focusing on the hyperscalers is kind of misleading. Yes, for programmers and tech companies AI is kinda boring now, but AI integration in general is still kind of uncharted territory. There are so many small companies and individuals just getting started with AI today and I believe a large the customer base (and revenue) is still untapped. Hell, I’m discovering new use cases regularly still and the average misman…

This is what so many people on HN and the market are constantly missing.

Jason Kottke almost didn't found his blog in 1998, famously quoted as saying: "I thought I was too late, that no one would be interested." Needless to say, the internet was a tiny joke in 1998 compared to what it is now.

We are just barely scratching the surface of what's possible with AI, both in terms of the leading edge and in the 'torso' of the economy (the portion you're describing).

Folks from Silicon Valley working in AI-forward companies have a skewed perception of how many people have adopted this technology so far. Codex recently celebrated hitting 10 million users. This is a great milestone and all, but to put it in context, Microsoft office has a billion users. Sure, many people use Claude Code and or some other harness and the growth is staggering, but the overall scale is tiny compared to software as a whole. Costs of serving and usage are still very high, prohibitively so for many, so we aren't even close to market saturation.

And even at the leading edge, people who do work in those AI-forward companies; models are still slow, require hand holding, and produce suboptimal outcomes sometimes. Imagine the value when instead of needing to prompt it once per 30 mins, you prompt it once per day. Then once per week. Then once per month. Imagine all this running not on 3 trillion parameter models, not on 10 trillion, but 100 trillion. What kind of computer infra will be needed then? Certainly more than we have today.

Re: Nvidia's Risky Business

#48

Post by wmf »

pletnes wrote: post #40
dzonga wrote: post #36

Nvidia has been playing a dangerous but profitable game since the Crypto boom. but now I think they probably have bitten more than they can chew. Apple already proved with their unified memory - that as long you have the capacity you can run capable models locally - thereby goes demand for inference if everyone is running some model locally. For training - Chinese models have proved that you don't need the latest & g…

Nvidia sell iot boards with unified architecture. Would not be shocked if they launch pc/laptop/server boards at some point.

RTX Spark already launched.

Re: Nvidia's Risky Business

#49

Post by georgemcbay »

2OEH8eoCRo0 wrote: post #43
dzonga wrote: post #36

Nvidia has been playing a dangerous but profitable game since the Crypto boom. but now I think they probably have bitten more than they can chew. Apple already proved with their unified memory - that as long you have the capacity you can run capable models locally - thereby goes demand for inference if everyone is running some model locally. For training - Chinese models have proved that you don't need the latest & g…

What's the danger? They slide back down to being just a gaming graphics card company with a $10 share price?

> What's the danger? They slide back down to being just a gaming graphics card company with a $10 share price?

Nvidia dropping from being a $5 trillion company to a $242 billion company would be 1929 levels of bad.

Global economy end of days stuff, especially since Nvidia can't crash that hard without a lot of other stuff crashing with it.

Re: Nvidia's Risky Business

#50

Post by Ekaros »

georgemcbay wrote: post #49
2OEH8eoCRo0 wrote: post #43

Earlier quoted context omitted.

What's the danger? They slide back down to being just a gaming graphics card company with a $10 share price?

> What's the danger? They slide back down to being just a gaming graphics card company with a $10 share price? Nvidia dropping from being a $5 trillion company to a $242 billion company would be 1929 levels of bad. Global economy end of days stuff, especially since Nvidia can't crash that hard without a lot of other stuff crashing with it.

How much in value could Nvidia safely drop and over what period of time for it be fine for greater economy? What level of correction would be manageable?

And I am pretty sure that their value will drop in 5 to 10 years.

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