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

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391–400 of 985 posts

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

#391

8T is the high-end of the McKinsey estimate that is 4-8T, by 20230. That includes non-AI data-centre IT, AI data-centre, and power infrastructure build out, also including real estate for data centres. Not all of it would be debt. Google, Meta, Microsoft and AWS have massive profit to fund their build outs. Power infrastructure will be funded by govts and tax dollars.

There is mounting evidence that even places like Meta are increasing their leverage (debt load) to fund this scale out. They're also starting to do accounting tricks like longer depreciation for assets which degrade quickly, such as GPUs (all the big clouds increasing their hardware depreciation from 2-3-4 years to 6), which makes their financial numbers look better but might not mean that all that hardware is still usable at production levels 6 years from now.

They're all starting to strain under all this AI pressure, even with their mega profits.

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

#392

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I was looking at my Newegg orders recently. 7/18/2023 - 64GB (2 x 32GB) 288-Pin PC RAM DDR5 6000 (PC5 48000) --> $260. Now, $750+.

Holy cow. I have 96GB of DDR5 I bought at start of year for a machine which never materialized. Might have to flip it.

Never in my dreams I could imagine PC parts could be an investment. Someone should start ETF tracking the prices.

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

#393

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100GW per year is not going to happen. The largest plant in the world is the Three Gorges Dam in China at 22GW and it’s off the scales huge. We’re not building the equivalent of four of those every year. Unless the plan is to power it off Sam Altman’s hot air. That could work. :) https://en.wikipedia.org/wiki/List_of_largest_power_stations

Amazing that 4 of the top 5 are renewables in China.

> As of 2025, The Medog Dam, currently under construction on the Yarlung Tsangpo river in Mêdog County, China, expected to be completed by 2033, is planned to have a capacity of 60 GW, three times that of the Three Gorges Dam.[3]

Meanwhile, “drill baby drill!”

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

#394

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The dotcom bust killed companies, not the Internet. AI will be no different. Most players won’t make it, but the tech will endure and expand.

The difference is that the Internet was actually useful technology, whereas AI is not (so far at least).

I think you're exaggerating a little, but aren't entirely wrong. The Internet has completely changed daily life for most of humanity. AI can mean a lot of things, but a lot of it is blown way out of proportion. I find LLMs useful to help me rephrase a sentence or explain some kind of topic, but it pales in comparison to email and web browsers, YouTube, and things like blogs.

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

#395
post #275

A decade ago, IBM was spending enormous amounts of money to tell me stuff like "cognitive finance is here" in big screen-hogging ads on nytimes.com. They were advertising Watson, vaporware which no one talks about today. Are they bitter that someone else has actually made the AI hype take off?

I don't know that I'd trust IBM when they are pitching their own stuff. But if anybody has experience with the difficulty of making money off of cutting-edge technology, it's IBM. They were early to AI, early to cloud computing, etc. And yet they failed to capture market share and grow revenues sufficiently in those areas. Cool tech demos (like the Watson Jeopardy) mimic some AI demos today (6-second videos). Yeah, i…

What you are saying is true. But IBM failing to see a way to make money off a new technology isn't actually news worth updating on in this case?

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

#396
post #294

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I'm looking forward to buying my own slightly used 5 million square ft data centre in Texas for $1

In TX? In Russian blogosphere it is a standard staple that Trump is rushing Ukrainian peace deal to be able to move on to the set of mega-projects with Russia - oil/gas in Arctic and data centers in Russian North-West where electricity and cooling is plentiful and cheap.

What could go wrong with placing critical infrastructure on the soil of a strategic rival?

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

#397
post #278

A decade ago, IBM was spending enormous amounts of money to tell me stuff like "cognitive finance is here" in big screen-hogging ads on nytimes.com. They were advertising Watson, vaporware which no one talks about today. Are they bitter that someone else has actually made the AI hype take off?

Honestly I'm not even sure what IBM does these days. Seems like one company that has slowly been dying for decades. but when I look at their stock, its at all time highs lol no idea

Mainframe for sure, but IBM has TONS of products in their portfolio that get bought. They also have IBM Cloud which is popular. Then there is the Quantum stuff they've been sinking money into for the last 20 years or so.

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

#399

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> Yes, I know it's all capital from VC firms and investment firms and other private sources, but it's still capital. It should be spent on meeting people's basic human needs, not GPU power. It's capital that belongs to people and those people can do what they like with the money they earned. So many great scientific breakthroughs that saved tens of millions of lives would never have happened if you had your way.

Please tell me which of Penicillin, insulin, the transistor, the discovery and analysis of the electric field, discovery of DNA, invention of mRNA vaccines, discovery of pottery, basket weaving, discovery of radiation, the recognition that citrus fruit or vitamin C prevents and cures scurvy (which we discovered like ten times), the process for creating artificial fertilizers, the creation of steel, domestication of b…

The transistor was funded by Bell Labs.

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

#400
post #360

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"They have great R&D but just can’t make products" Is this just something you repeat without thinking? It seems to be a popular sentiment here on Hacker News, but really makes no sense if you think about it. Products: Search, Gmail, Chrome, Android, Maps, Youtube, Workspace (Drive, Docs, Sheets, Calendar, Meet), Photos, Play Store, Chromebook, Pixel ... not to mention Cloud, Waymo, and Gemini ... So many widely adopt…

I don't think Google is bad at building products. They definitely are excellent at scaling products. But I reckon part of the sentiment stems from many of the more famous Google products being acquisitions orignally (Android, YouTube, Maps, Docs, Sheets, DeepMind) or originally built by individual contributors internally (Gmail). Then here were also several times where Google came out with multiple different products…

Why wouldn't you count things initially made by individual contributors at Google?
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