I should have been more clear on this - in terms of total install base I don't know that it's going to be "significant" in terms of customer count.
However, I do think it will be at least "noticeable" in terms of individual customers with large spend. Total GCP revenue in 2022 was roughly 65 billion and Snap leaving alone is 1.5% of total revenue.
Especially looking at ML cases where cloud GPU pricing is wildly expensive - retail on-demand instance A100 pricing is at least $3/hr which practically speaking with the AWS pricing model is can be twice that all-in. This is for an instance with 32GB of RAM and 8 VCPUs - which for a lot of A100 use cases is useless. Need 32 vCPU and 256 GB of RAM? That's more like $20/hr.
A single A100 machine that's above and beyond more capable can be had from Dell for roughly $50k, which even factoring in hosting based on colo pricing I've seen has an ROI of ~15 months for constant usage. For the equivalent hardware (and still vastly improved performance - 32vCPU and 256GB of RAM) that ROI gets to less than six months.
Yes, the A100 is typically used for training (and cloud definitely still makes sense there) but more and more models require the performance and VRAM of a V100/H100 for inference (24/365 availability). Do it at any kind of scale/redundancy and ROI catches up even faster. An equivalent to this approach is reserved pricing, which over the 1-3yr term of a lease vs. reserved instance self-hosting becomes almost comically more cost and performance effective. With the extra benefit of actually being more flexible.
Financing and leasing is readily available and with various tax incentives (like Section 179 leasing) you can pretty quickly pay for a FTE to manage the infra for you - which is probably a wash anyway because at any kind of "real" scale or complexity you almost certainly already have dedicated human resources just to manage cloud. You don't even ever need for an employee to go to the hosting facility because most will rack and provision your hardware for free. Combined with remote hands and standard warranty support any (in my experience very rare) hardware failures just get handled.
I should note that this model almost eliminates the tendency for cloud spend to balloon to many X anticipated/budgeted spend - the all too common story of "sticker shock" from clouds on bandwidth alone that cloud has ridiculous markups on. Colo pricing and leases are fixed cost (with all you can eat port speed bandwidth included or so cheap at 95th percentile billing it's practically a rounding error).
I have significant experience at CTO level with both approaches (and hybrid, of course). In many situations the benefits of "self-hosting" vs cloud are dramatic.
The extremely effective marketing that has created and perpetuated an industry wide fear of self-hosting and hardware (especially with the "always cloud always" generation) is fading. I think the uptime and reliability promises of cloud are also fading - this thread started off with discussion of yet-another cloud outage. My background is in healthcare and telecom and I'm shocked at the cavalier attitude of just accepting these outages and being down while standing around helpless wondering when your big cloud will acknowledge, communicate, and resolve them. A few machines in a few rack units of space across a couple of facilities generally trounces cloud in reliability and uptime.
I love HN and the overall knowledge and quality of discussion here but when it comes to hardware and self-hosting many have completely drunk the cloud Kool-Aid and have zero experience with self-hosting - so no idea what they're talking about. Not saying you personally, just generally.