I'm not against subsidies but the concentration is a problem. This money could have spurned grass roots participation in these emerging industries, but instead they chose to go with the most heinous of monocultures, leaving billions of people out of the loop.
Thanks a lot, AI: Hard drives are sold out for the year, says WD
81–90 of 328 posts
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#82Earlier quoted context omitted.
Regardless where demand comes from, it takes time to spin up a hard drive factory, and prices would have to rise enough that, as a producer, you would feel confident that a new hard drive factory will actually pay off. Conversely, if you feel that boom is irrational and temporary, as a producer you’d be quite wary of investing money in a new factory if there was a risk it would be producing into a glut in a few years…
If I remember during a previous GPU shortage (crypto?), Nvidia (and/or TSMC?) basically knew the music would stop and didn't want to be caught with its pants down after making the significant investments necessary to increase production Not to mention that without enough competition, you can just raise prices, which, uh (gestures at Nvidia GPU price trends...)
Similar thing happened with mask manufacturers during COVID.
They didn't spin up additional mask production b/c they knew the pandemic would eventually pass. They learned this lesson from SARS.
Not maxing out production during spikes (or seasonality) in demand is a key tenet of being a "rational economic actor".
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#83There's clearly easy/irrational money distorting the markets here. Normally this wouldn't be a problem: prices would go up, supply would eventually increase and everybody would be okay. But with AI being massively subsidized by nation-states and investors, there's no price that is too high for these supplies. Eventually the music will stop when the easy money runs out and we'll see how much people are truly willing t…
No it’s not an easy fix. Manufacturers don’t have a good pulse on long term demand. The he capex to spin up a new manufacturing plant is significant. Especially with the recency of Covid where some folks did get caught with their pants down and over invested during the huge demand boom. I don’t quite follow the narrative like yours about nation states and investors. There is certainly an industrial bubble going on an…
Smart manufacturers will sell 'hard drive futures'. Ie. "Give us $100/drive now for 100k drives for delivery in march 2028".
These contracts are then transferrable. The manufacturer can start work on a factory knowing they'll get paid to produce the drives.
If the AI boom comes to an end, the manufacturer is still going to get paid for their factory, and if the AI company wants to recoup costs they could try to sell those contracts back to the manufacturer for pennies on the dollar, who might then decide (if it is more profitable) to halt work on the factory - and either way they make money.
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#84I console myself with knowledge of the economics maxim that every supply shortage is usually, eventually, followed by a supply glut. One can only hope that that's the principle at work here, anyway. It could also be a critically damped system for all I know. Unfortunately I studied control systems too...
If storage and memory manufacturer don't respond with increasing supply. There might not be glut. Just postponed demand that will slowly get fulfilled over longer period. That is if we were in steady state.
On other hand if there is bigger economic turmoil that might mean that the postponed demand does not realise as there is no purchasing power...
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#85There's clearly easy/irrational money distorting the markets here. Normally this wouldn't be a problem: prices would go up, supply would eventually increase and everybody would be okay. But with AI being massively subsidized by nation-states and investors, there's no price that is too high for these supplies. Eventually the music will stop when the easy money runs out and we'll see how much people are truly willing t…
Regardless where demand comes from, it takes time to spin up a hard drive factory, and prices would have to rise enough that, as a producer, you would feel confident that a new hard drive factory will actually pay off. Conversely, if you feel that boom is irrational and temporary, as a producer you’d be quite wary of investing money in a new factory if there was a risk it would be producing into a glut in a few years…
Are these factories already running 24/7 that labor can't be added to make more without adding capital infra?
And if they were running 24/7, maybe setting up another factory or line will avoid some of the 24/7 scheduling.
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#86I listed some hard drives on Friday on eBay.. most of them refurbished... within 5 minutes got a message from a person who wanted them all... shipped them an hour later
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#87Earlier quoted context omitted.
There's clearly easy/irrational money distorting the markets here. No, I think it is real demand. AI will cause shortages in everything from GPUs to CPUs, RAM, storage, networking, fiber, etc because of real demand. The physical world can't keep up with AI progress. Hence, shortages. AI simply increases computer use by magnitudes. Now you can suddenly use Seedance 2.0 to make CGI that would have cost tens of millions…
I wonder if I'm alone in being optimistic about this. I believe that the gigantic inflow of money into hardware will lead to large increase in production capabilities, accelerated progress and perhaps even new, better architectures.
I actually agree: a spike in prices due to bumping against capacity limits is way better than a downturn in the market. But this is only really true if AI hyperscalers are incented to space out their big buildouts over time (while raising their prices enough to ration current demand) so that suppliers can have some guarantee that their expanded capacity will be used.
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#88Earlier quoted context omitted.
Loved the reference. Probably from Margin Call[0] 0. https://youtu.be/fij_ixfjiZE
I like to imagine the reference in the movie margin call is that of a merry go round or a game of Musical chair. Like we are all on a ride, none of us are the operator, and all we can do is guess when the music will stop (and the ride ends). The problem with this AI stuff is we don't know how much we will be willing to pay for it, as individuals, as businesses, as nations. I guess we just don't know how far this stuf…
TBF, all financial market is speculation these days, what only change is the figure/percentage of how much a share is actually the value it's priced.
> The problem with this AI stuff is we don't know how much we will be willing to pay for it, as individuals, as businesses, as nations. I guess we just don't know how far this stuff will be useful. The reasons for the high valuation is, in my guess, that there is more value here than what we have tapped so far, right?
I think the value now comes on how we make a product of it, for example, like OpenClaw. Whether we like or not, AI is really expensive to train, not only in monetary value but also in resources, and the gains have been diminishing with each “generation”. Let's not forget we heard promises that have not been fulfilled, for example AGI or “AI could potentially cure cancer, with enough power”.
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#89Earlier quoted context omitted.
I'm not saying that data center buildouts can't overshoot demand but AI and compute is different than fiber buildout. The more compute you have, the smarter the AI. You can use the compute to let the AI think longer (maybe hours/days/weeks) on a solution. You can run multiple AI agents simultaneously and have them work together or check each other's work. You can train and inference better models with more compute. S…
You can't really use compute more because power is already the bottleneck. Datacenter buildouts are now being measured in GW which tells you everything you need to know. Newer hardware will be a lot more power-efficient but also highly scarce for that reason.
Energy is also being scaled up. But the fundamental difference between compute and fiber buildup is different in my opinion.
Re: Thanks a lot, AI: Hard drives are sold out for the year, says WD
#90Better stock up with used laptops. I'm going to buy another one this year. Those used ones usually don't last very long. What if in the near future it is simply too expensive to own "personal" computers? What if you can no longer buy used computers from official channels but have to find local shops or sharpen up on soldering skills and find parts from dumps? The big techs will conveniently "rent out" cloud computer…
I have heard that you can get used laptops. But they do not come with memory or SSD anymore... As even used components are now valuable enough to be removed and sold.