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Google to pay SpaceX $920M a month for compute capacity at xAI data centers

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Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#711

Post by l23k4 »

timeflex wrote: post #568
l23k4 wrote: post #508

Earlier quoted context omitted.

[flagged]

No where did they say anything antisemitic, but you further diminishing the meaning of that word—just like BB has already—only enables actual antisemitism. I frequently see that label being weaponized, especially against other Jews. I see it be used when people merely report on what the President has said, or against the Pope calling for peace. At some point, I'm inclined to believe people constantly making these fal…

It's not my fault their conspiracy theory is awfully similar to popular long-running far-right conspiracy theories.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#712

Post by eep_social »

solenoid0937 wrote: post #507
davedx wrote: post #484

Earlier quoted context omitted.

Start gradually converting your equity to bonds is the standard advice on that timeframe. If you're dreading equity drawdowns, that's what fixed income is for.

This is absolutely terrible advice and is out of touch with modern financial understanding. Bonds feel psychologically safer, but lead to failure more often than total market equity portfolios, even when you account for market crashes. https://youtu.be/p25PPBgMiEk

What you said is not what the linked video says, so at best this is terrible advice piling onto terrible advice.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#713

Post by fHr »

tristanj wrote: post #205

This is a masterful piece of financial engineering by Google and SpaceX. Google purchased 10% of SpaceX over a decade ago. After dilution they probably own around 5%. SpaceX is valued at a whopping 94x revenue. This deal increases SpaceX's revenue by $11 billion per year. If SpaceX maintains this revenue multiplier, then this single deal boosts SpaceX's valuation by 94 x 11 billion = $1 trillion dollars. Google owns…

what the actual fuck haha

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#714

Post by notahacker »

JumpCrisscross wrote: post #666
manlymuppet wrote: post #645

Earlier quoted context omitted.

That's what I'm saying though. They must be getting something out of this deal, otherwise why would they be going through with it? The explanation that this is just financial engineering (which to me, means neither Google nor SpaceX is getting anything out of this other than looking better on paper) doesn't make sense to me. How does this financial engineering benefit Google? Even if they have an exit option, why is…

> must be getting something out of this deal They’re getting compute. There was a free for all period when xAI did one smart thing and that’s build like there’s no tomorrow. Because tomorrow is today, and today jurisdictions are racing to pause datacenter construction.

yeah

the ironic thing is if the parties involved were bullish on xAI winning or near term ODCs undercutting compute costs this deal wouldn't have been attractive. But as it is, Google probably only slightly overpays for boring ground-based datacenter space they actually need to hit internal goals, and it looks even better if IPO investors in a stock they hold pick up some of the the tab.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#715

Post by tasuki »

pqtyw wrote: post #470
tasuki wrote: post #445

Earlier quoted context omitted.

> Somebody will be left holding the bag eventually. I think so too. I also thought that about Facebook: IPO around 40, swiftly down to 20 - I was laughing about stupid retail getting wrecked. Now it's around 600...

Maybe you are right, maybe not.. However Facebook as an example seems entirely irrelevant, though? It was valued 15 P/S ratio at IPO and went down to 10 a year after the IPO. You'd have a point if Facebook IPO at $400 instead of $40. But it took it 10 years to reach that. SpaceX IPO price already has many years of extremely high growth priced in. Comparing it to Facebook's or Google's IPOs is like apples to oranges.

> Maybe you are right, maybe not..

About what precisely?

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#716

Post by notahacker »

bombcar wrote: post #537
HarHarVeryFunny wrote: post #414

Earlier quoted context omitted.

As I recall isn't Starlink revenue at least 3x Space revenue, so not sure how they are characterizing that 3:1 ratio as 3% vs 4% ! The "93% AI company" is also a huge mischaracterization since this isn't AI business - it's datacenter/GPU leasing business which their 2 customers can pull the plug on with 90 days notice.

Does Starlink pay SpaceX for launches?

Yes. Amount is actually irrelevant, since if they underprice it SpaceX loses launch revenue, and if they overprice it Starlink looks less profitable.

The more important takeaways are that SpaceX's near-monopoly launch business is profitable but not nearly as big as Starlink, and Starlink is a good business but not one to justify a trillion dollar valuation

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#717

Post by SJC_Hacker »

Alive-in-2025 wrote: post #337
benl wrote: post #322

Earlier quoted context omitted.

The bet is that demand for AI tokens will continue to grow exponentially. And that SpaceX will be able to deploy and rent out GPUs to serve those tokens faster than anyone else. The wrinkle is that they are planning to deploy those GPUs in space. That’s what people are most skeptical about, I think!

Space data centers need years of time to design, build, and deploy, 5-10 at least, and that's after they solve their multiple very difficult or impossible problems. How will they cool them? There are just simple ideas like giant structures to radiate the heat away, but you say you need to put lots of mass in orbit? Like fsd, will take decades to figure things out.

Cooling in space does not seem like a hard problem to me. You absorb a certain amount of energy in a given time in the form of solar energy, you should be able to emit that. On top of that, in LEO you are only in solar orbit roughly 50% of the time

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#718

Post by solenoid0937 »

eep_social wrote: post #712
solenoid0937 wrote: post #507

Earlier quoted context omitted.

This is absolutely terrible advice and is out of touch with modern financial understanding. Bonds feel psychologically safer, but lead to failure more often than total market equity portfolios, even when you account for market crashes. https://youtu.be/p25PPBgMiEk

What you said is not what the linked video says, so at best this is terrible advice piling onto terrible advice.

It is precisely what the video says. Ben has discussed this multiple times as well, not just in this video. If you have better behavioral tolerance for volatility (as in you're not the type to panic sell), total market equities will outperform and lead to less failure in retirement.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#719

Post by testing22321 »

gmd63 wrote: post #691
testing22321 wrote: post #573

Earlier quoted context omitted.

Isn’t that the entire point of a capitalist economy? What is the alternative?

No, the point is to implement laws that foster holistic growth, not gamesmanship that ends in terminal illness.

> holistic growth

I have never before heard that term in regards to the economy.

Everyone has always wanted maximum growth now, future be dammed.

Re: Google to pay SpaceX $920M a month for compute capacity at xAI data centers

#720

Post by mannanj »

tristanj wrote: post #294
mannanj wrote: post #251

Earlier quoted context omitted.

Do you really think its honest to call this Financial Engineering over Fraud?

No. The definition of fraud is "lying for financial gain". This doesn't qualify.

Heres the way I understand it as a child could understand.

You are google. I am your friend who wants to sell lemonade.

You have invested in my stand and own a piece. You propose a deal, You'll buy $11 of lemonade from me every week.

Does my stand look like it sells way more lemonade, than it would in reality? And since you own a piece, your own piece has appreciated. You ran the numbers and that spending of yours helps appreciate it considerably more (feel free to plugin the actual spaces-google numbers here and change the analogy).

Are the people who invest in my business after you, on its new valuation, aware that you are the one buying most my lemonade? And are you going to keep buying or will stop buying soon (probably as soon as you can unload your investment on strangers). So the fraud and lie as you said, is the behavior is not as real as it looks.

Am I thinking this through wrong, what do you think?

Edit: my definition of fraud is simpler and different from yours. a "lie" need not be there. fraud is any intentional misrepresentation (i.e. misrepresenting income to the public).

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