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thln666 | on: I'm not convinced the AI bubble exists
unless I am mistaken, you missed that the datacenter infrastructure being a one-time cost. nope. those servers have about a 5 year lifetime and then are likely to be replaced. The buildings aren't the expensive part. The GPUs are.

so I think that's one big miss from this blog, or I don't understand datacenters as well as I think I do (which is always a possibility! hopefully someone will inform me if I am wrong)

matwood | parent
> those servers have about a 5 year lifetime and then are likely to be replaced

This made sense in the past when they were not prohibitively expensive, but other than them breaking down why replace them on the 5 year schedule now? Yes, the newer stuff is better but the jumps from this point forward seem more incremental than revolutionary hardware wise. And even then, a company can simply swap out racks as parts fail.

Hendrikto | root | parent | next
Anthropic (iirc) said that GPUs have a failure rate of 10% per year, so you will have to replace them with an upper bound of something like 10 years.

Also, power draw is a huge cost factor, and newer models are more power efficient. If you want to stay competitive, you will have to upgrade.

Same for density. Data centers take time to build and face ever increasing opposition. By increasing density, you can improve competitiveness as well.

thln666 | root | parent
it's because you can no longer write off depreciation costs for taxes after 5 years.