This data center boom is so reminiscent of the .com period. Suddenly everybody with two computers next to each other had a data center (usually in a closet somewhere, if you were lucky it was locked).
> I am also deeply concerned about the “speculative” data center market. The “build it and they will come”strategy is a trap. If you are a hyperscaler, you will own your own data centers.
Is this actually true? I thought that hyperscalers keep datacenters at arm's length, using subsidiaries and outsourcing a lot of things.
They are building too many steam engines. It's a bubble that's going to pop and leave investors empty handed. There are only so many mines to pump water out of, mills to turn, textile machines to run. And those industries have jumped on a bandwagon that they don't understand, and most will soon mostly revert to good old English laborers. His Majesty's subjects are starting to understand terrible environmental effects of burning so much more coal. As a prudent investor I now recommend a Sell for the stocks of the Boulton & Watt company.
If/when the AI bubble pops and we're left with hundreds of underutilized datacenters, I think this could be good for hosting customers by driving prices down across the board. Maybe it will make self-hosting even more cheaper than public clouds.
Don't these data centers have pretty elaborate cooling setups that use large volumes of water?
So they're sitting on real estate with access to massive amounts of water, electricity, and high bandwidth network connections. Seems like that combination of resources could be useful for a lot of other things beyond just data centers.
Like you could probably run desalination plants, large scale hydroponic farms, semiconductor manufacturing, or chemical processing facilities. Anything that needs the trifecta of heavy power, water infrastructure, and fiber connectivity could slot right in.
I think the interesting thing would be if something like Euclyd is successful, and the 10 GW become 100 MW, and the giant server halls become 800 cabinets total.
Then the inference mega datacentre investment becomes a losing proposition for those who paid too much for the wrong kind of computers, but AI users still get more compute, lower prices etc.
The GPUs being used for AI training aren't useful for running games, I highly doubt they could be repurposed for that.
They can run other ML stuff but I don't see how the world could absorb the amount of compute/RAM for these other workflows.
Since the hardware itself depreciates quite fast compared to the buildings, the long lasting physical structure is probably the best bet, being repurposed for more general computing (since all HVAC, electricity, and other expensive infrastructure is already in place).
> Data centers are becoming political flashpoints, primarily because of their impact on electricity prices.
I'd bet anything that they know people are pissed the market has wildly misallocated capital and are trying to save face by framing it as a cost that directly impacts consumers. In reality, the fear is knowing that our investor class is really too dumb to handle the money we've stuck in a box called "the world's retirement funds" and handed to them.
Axios hijacks the back button. The TLDR is: we’re building too much speculative capacity and the “if we build it, they will come” assumption will be proven wrong.
This data center boom is so reminiscent of the .com period. Suddenly everybody with two computers next to each other had a data center (usually in a closet somewhere, if you were lucky it was locked).
> I am also deeply concerned about the “speculative” data center market. The “build it and they will come”strategy is a trap. If you are a hyperscaler, you will own your own data centers.
Is this actually true? I thought that hyperscalers keep datacenters at arm's length, using subsidiaries and outsourcing a lot of things.
They are building too many steam engines. It's a bubble that's going to pop and leave investors empty handed. There are only so many mines to pump water out of, mills to turn, textile machines to run. And those industries have jumped on a bandwagon that they don't understand, and most will soon mostly revert to good old English laborers. His Majesty's subjects are starting to understand terrible environmental effects of burning so much more coal. As a prudent investor I now recommend a Sell for the stocks of the Boulton & Watt company.
> They are building too many steam engines. It's a bubble that's going to pop and leave investors empty handed.
What a great analogy. People building too many steam engines was one of the main factors that lead to the first world war.
Sounds interesting. Do you have a source for that?
If/when the AI bubble pops and we're left with hundreds of underutilized datacenters, I think this could be good for hosting customers by driving prices down across the board. Maybe it will make self-hosting even more cheaper than public clouds.
Don't these data centers have pretty elaborate cooling setups that use large volumes of water?
So they're sitting on real estate with access to massive amounts of water, electricity, and high bandwidth network connections. Seems like that combination of resources could be useful for a lot of other things beyond just data centers.
Like you could probably run desalination plants, large scale hydroponic farms, semiconductor manufacturing, or chemical processing facilities. Anything that needs the trifecta of heavy power, water infrastructure, and fiber connectivity could slot right in.
I think the interesting thing would be if something like Euclyd is successful, and the 10 GW become 100 MW, and the giant server halls become 800 cabinets total.
Then the inference mega datacentre investment becomes a losing proposition for those who paid too much for the wrong kind of computers, but AI users still get more compute, lower prices etc.
Aren't these datacenters biased majorly towards GPU capacity? Maybe we'll see a resurgence of cloud game streaming initiatives.
The GPUs being used for AI training aren't useful for running games, I highly doubt they could be repurposed for that.
They can run other ML stuff but I don't see how the world could absorb the amount of compute/RAM for these other workflows.
Since the hardware itself depreciates quite fast compared to the buildings, the long lasting physical structure is probably the best bet, being repurposed for more general computing (since all HVAC, electricity, and other expensive infrastructure is already in place).
I'm sure this will be a nice consolation as the meaningful part of the economy collapses
I was more thinking these data centers will become homeless shelters.
The best indication that this isn't a bubble is all the people who would jump at the chance to buy more capacity if the price drops even a little.
> Data centers are becoming political flashpoints, primarily because of their impact on electricity prices.
I'd bet anything that they know people are pissed the market has wildly misallocated capital and are trying to save face by framing it as a cost that directly impacts consumers. In reality, the fear is knowing that our investor class is really too dumb to handle the money we've stuck in a box called "the world's retirement funds" and handed to them.
Axios hijacks the back button. The TLDR is: we’re building too much speculative capacity and the “if we build it, they will come” assumption will be proven wrong.
Such bad behavior on the back button - it’s such a shabby trick, and makes me think less of any site that pulls that.
I always think about the developers who were asked to implement something like this