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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

#501

Post by prmoustache »

AdrianB1 wrote: post #281
bigwheels wrote: post #205

Earlier quoted context omitted.

Because usually it's more efficient for companies to retire the hardware and put in new stuff. Meanwhile, my 10-15 year old server hardware keeps chugging along just fine in the rack in my garage.

I thought the same until I calculated that newer hardware consumes a few times less energy and for something running 24x7 that adds up quite a bit (I live in Europe, energy is quite expensive). So my homelab equipment is just 5 years old and it will get replaced in 2-3 years with something even more power efficient.

I guess you did the math but wouldn't it be more effective to spend the money on solar panels instead of replacing the computer hardware?

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

#502

Post by jacquesm »

simianwords wrote: post #498

If it is so obvious that it won’t pay off, why is every company investing in it? What alpha do you have that they don’t?

That's a good question. During the .com boom everybody was investing in 'the internet' or at least in 'the web'. And lots of those companies went bust, quite a few spectacularly so. Since then everything that was promised and a lot more has been realized. Even so, a lot of those initial schemes were harebrained at best at the time and there is a fair chance that we will look in a similar way at the current AI offerings in 30 years time.

Short term is always disappointing, long term usually overperforms. Think back to the first person making a working transistor and what came of that.

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

#503

Post by altmanaltman »

Atlas667 wrote: post #456
pinnochio wrote: post #439

Earlier quoted context omitted.

[flagged]

The AI astroturfing campaign. If you had billions to gain, would you invest a few 100k or millions in an astroturfing campaign?

every other day antrophic comes up with a new "AI is scary" marketing campaign. Like https://www.bbc.com/news/articles/cpqeng9d20go (AI blackmails our employee episode) or https://time.com/7335746/ai-anthropic-claude-hack-evil/ (Our model turned evil and hacked us omgg)

They put these stories out just to make the general public (who might not understand that this is just bs) but makes AI seem scary so people get a lopsided view of AI and capacities that are straight out of science fiction.

Millions is an understatement on how much AI marketing spend is

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

#504

Post by Jean-Papoulos »

stevenjgarner wrote: post #240

"It is 1958. IBM passes up the chance to buy a young, fledgling company that has invented a new technology called xerography. Two years later, Xerox is born, and IBM has been kicking themselves ever since. It is ten years later, the late '60s. Digital Equipment DEC and others invent the minicomputer. IBM dismisses the minicomputer as too small to do serious computing and, therefore, unimportant to their business. DEC…

But how many companies did IBM pass on that did crash and burn ? And how many did it not pass on and did decently ? They're still around after more than 3 generations worth of tech industry. They're doing something right.

TLDR Cherrypicking

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

#505

Post by fulafel »

physicsguy wrote: post #452
matt-p wrote: post #241

Earlier quoted context omitted.

I mean you could use training GPUs for inference right? That would be use case number 1 for a 8 * a100 box in a couple of years. It can also be used for non IO limited things like folding proteins or other 'scientific' use cases. Push comes to shove im sure an old A100 will run crysis.

> Push comes to shove im sure an old A100 will run crysis. They don’t have video out ports!

Just like laptop dGPUs.

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

#506

Post by darkwater »

sho wrote: post #480
cjonas wrote: post #421

Earlier quoted context omitted.

I think it's a bit different because a rental car generates direct revenue that covers its cost. These GPU data centers are being used to train models (which themselves quickly become obsolete) and provide inference at a loss. Nothing in the current chain is profitable except selling the GPUs.

> and provide inference at a loss You say this like it's some sort of established fact. My understanding is the exact opposite and that inference is plenty profitable - the reason the companies are perpetually in the red is that they're always heavily investing in the next, larger generation. I'm not Anthropic's CFO so i can't really prove who's right one way or the other, but I will note that your version relies on…

The current generation of today was the next generation of yesterday. So, unless the services sold on inference can cover the cost of inference + training AND gain money, they are still operating at loss.

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

#507

Post by spiderfarmer »

elnatro wrote: post #493
stevenjgarner wrote: post #240

"It is 1958. IBM passes up the chance to buy a young, fledgling company that has invented a new technology called xerography. Two years later, Xerox is born, and IBM has been kicking themselves ever since. It is ten years later, the late '60s. Digital Equipment DEC and others invent the minicomputer. IBM dismisses the minicomputer as too small to do serious computing and, therefore, unimportant to their business. DEC…

Were Xerox, Dec, or Apple burning investor money by the billions of dollars?

No, but the comment above and variations of it are mentioned in every thread about IBM, so it’s probably just a reflex at this point without much thought behind it.

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

#508

Post by darkwater »

chii wrote: post #453
physicsguy wrote: post #449

Earlier quoted context omitted.

Data centre cards a don’t have fans and don’t have video out these days.

i dont mean consumer market for video cards - i mean a consumer buying ai chips to run themselves so they can have it locally. If i can buy a $10k ai card for less than $5000 dollars, i probably would, if i can use it to run an open model myself.

How many "yous" are there in the world? Probably a number that can buy what's inside one Azure DC?

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

#509

Post by simianwords »

jacquesm wrote: post #502
simianwords wrote: post #498

If it is so obvious that it won’t pay off, why is every company investing in it? What alpha do you have that they don’t?

That's a good question. During the .com boom everybody was investing in 'the internet' or at least in 'the web'. And lots of those companies went bust, quite a few spectacularly so. Since then everything that was promised and a lot more has been realized. Even so, a lot of those initial schemes were harebrained at best at the time and there is a fair chance that we will look in a similar way at the current AI offerin…

I still don’t get it. What at a personal level is making Sam Altman make a suboptimal choice for himself if it is so obvious it won’t work out for him?

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

#510

Post by alex77456 »

altmanaltman wrote: post #500
vlovich123 wrote: post #494

Earlier quoted context omitted.

It’s the ship of Theseus in corporate form. Even if all the people are gone but the culture hasn’t changed, is the criticism inaccurate?

I mean, okay, but you're taking the current leadership's words and claiming they are incorrect because IBM management was not great at identifying trends decades ago. Historical trend is not an indicator of the future and it's not engaging in good faith on the conversation if overspending on AI can be backed by revenue in the future. You're attacking the messenger instead of the message.

I didn't read the top level comment as dismissive or 'proving it wrong', but rather as adding context, or even being humorous somewhat
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