If they could make this stuff and sell it to regular people a decade ago for very palatable prices, why do they come up with the idea that this is the technology of the gods, unaffordable by mere mortals?
Heck, I have a phone with a 16bit memory bus for instance. The high(ish) clock rate only makes up the difference slightly.
But with general prices on all components going up, it might not be such a big factor any more.
HBM migght make sense for higher end products which can free up space for the lower end that will never use the tech.
5090 has 1.8 TB/s?
(Well that and collusion)
You get market signals that the demand is there, you acquire the necessary capital, you spend 5 years to build capacity, but guess what, 5 other market players did the same thing. So now you are doomed, because the market is flooded and you have low cash flow since you need to drop prices to compete for pennies.
Now you cannot find capital, you don't invest, but guess what, neither your competitors did. So now the demand is higher than the supply. Your price per unit sold skyrocketed, but you don't have enough capacity!
Rinse and repeat.
Capitalists claim that this is optimal.
If anything, it shows it's possible for you to arbitrage this and in doing so help "smooth out the cycle."
We don't even expect companies to plan long-term anymore, it's just moving wealth as fast as possible.
That isn't really a change, very few people could ever have been said to be ideological capitalists. (capitalist is not a word with a hard definition, but I'm considering it a different thing than the more modern pure libertarian zero-regulation ideology)
Because that does not happen exactly as you say for all players. The demand signals will be processed and long-term risk is balanced against short-term gain in a distributed fashion, so not everyone will do the same.
At least with capitalism you have many different people with different perspectives on the risk making independent bets. That mitigates the more extreme negative outcomes.
It's more optimal than planned economies until we have AI planned economies with realtime feedback, I guess.
Consumers get cheap goods during oversupply and most inefficient companies get elliminated during bust while consolidation leads to economies of scale.
There is an alternative where legislation dampens this behavior but the short term profits will be lower. Hence the hawks don’t like it.
Potentially. Well meaning and thought out legislation still distorts the markets, possibly making things objectively worse.
That is, memory capacity is reserved for datacenters yet to be built, but this will do weird things if said datacenter construction is postponed or cancelled altogether.
Are the Netherlands a large proportion of global datacenters?
In most other places the percentage is significantly less than that and then you can easily add more of the cheap-but-intermittent stuff because a cloudy day only requires you to make up a 10% shortfall instead of a 50% one, which existing hydro or natural gas plants can handle without new storage when there are more of them to begin with.
In every country? Citation needed.
We've been projecting both FTL and AGI as future possibilities for almost 100 years now. Do LLMs get us a lot closer to AGI? I think they get us a little closer and Moore's "law" making compute faster probably is a much bigger factor, but I think we're still a very very long ways away.
The memory makers specifically did not scale up capacity to avoid being left holding the bag.
The real issue is everyone wanting to upgrade to hbm, ddr5, and nvme5 at the same time.
OpenAI (or whoever) crashes and can't pay for the order leaving the memory makers in a tough spot.
The Fiji XT architecture after it had 512GB/S on a 4096b HBM bus in 2015.
The Vega architecture did have 400GB/s or so in 2017, which was a bit of a downgrade.
Very few applications other than GPUs need HBM.
The customer ran out of money. In terms of where you are in line of debtors when you haven't even delivered the product to a customer, it's so far back as to be assured you won't get your money.
If the memory makers got a deposit from OpenAI as part of this deal, that is likely to be the only money they will get for any undelivered memory, particularly if OpenAI runs out of capital.
Edit: also, that demand pressure is going to be applied constantly; there isn’t going to be a shock, it’s just going to keep prices high longer.
this view isn't updated correctly post-claude code and codex. there will clearly be sufficient demand.
I hope they do, they did not have to agree to sell so much RAM to one customer. They’ve been caught colluding and price fixing more than once, I hope they take it in the shorts and new competitors arise or they go bankrupt and new management takes over the existing plants.
Don’t put all your eggs in the one basket is how the old saying goes.
We aren't. The remaining memory manufacturers fear getting caught in a "pork cycle" yet again - that is why there's only the three large ones left anyway.
China has memory makers who are creeping up through the stages of production maturity, and once they hit then there's no going back.
If the existing makers can't meet supply such that Chinese exports get their foot in the door, they may find they never get ahead again due to volume - that domestic market is huge so they have scale, and the gaming market isn't going to care because they get anything at the moment, which is all you'll need for enterprise to say "are we really afraid of memory in this business?"
Wasn't the problem here that OpenAI was negotiating with Samsung and SK Hynix at the same time without the other one knowing about it? People only realized the implications when they announced both deals at once.
They act as a de-facto monopoly and milk us. Why is this allowed?
Nobody is "allowing" this. It's a natural property of being both advanced technology and a commodity at the same time.
Recently they had a second price fixing lawsuit thrown out (in the US).
Now with the state of things I'm sure another lawsuit will arrive and be thrown out because the government will do anything to keep the AI bubble rolling and a price fixing suit will be a threat to national security, somehow. Obviously thats speculative and opinion but to be clear, people are allowing it. There are and more so were things that could be done.
It started with raegan, and even parties on the “left” in the west believe in it with very few exceptions.
The thing that enables this is pretty obvious. The population is divided into two camps, the first of which holds the heuristic that regulations are "communism and totalitarianism" and this camp is used to prevent e.g. antitrust rules/enforcement. The second camp holds the heuristic that companies need to be aggressively "regulated" and this camp is used to create/sustain rules making it harder to enter the market.
The problem is that ordinary people don't have the resources to dive into the details of any given proposal but the companies do. So what we need is a simple heuristic for ordinary people to distinguish them: Make the majority of "regulations" apply only to companies with more than 20% market share. No one is allowed to dump industrial waste in the river but only dominant companies have bureaucratic reporting requirements etc. Allow private lawsuits against dominant companies for certain offenses but only government-initiated prosecutions against smaller ones, the latter preventing incumbents from miring new challengers in litigation and requiring proof beyond a reasonable doubt.
This even makes logical sense, because most of the rules are attempts to mitigate an uncompetitive market, so applying them to new entrants or markets with >5 competitors is more likely to be deleterious, i.e. drive further consolidation. Whereas if the market is already consolidated then the thicket of rules constrains the incumbents from abusing their dominance in the uncompetitive market while encouraging new entrants who are below the threshold.
Oh no!
If they add enough capacity to meet current demand quickly then if demand crashes they still have billions of dollars in loans used to build capacity for demand that no longer exists and then they go bankrupt.
The biggest problem is predicting future demand, because it often declines quickly rather than gradually.
There’s virtually infinite capital: if needed, more can be reallocated from the federal government (funded with debt), from public companies (funded with people’s retirement funds), from people’s pockets via wealth redistribution upwards, from offshore investment.
They will be allowed to strangle any part of the supply chain they want.
Another point is I often see the money argument - like country X has more money, so they can afford to do more and better R&D, make more stuff.
This stuff comes out of factories, that need to be built, the machinery procured, engineers trained and hired.
[1]https://www.tomshardware.com/tech-industry/semiconductors/ym...
> more can be reallocated from the federal government (funded with debt)
While this is the most reliable funding, it's still not very accessible. OpenAI is a money pit, and their demands are growing quickly. The US government has started a bunch of very expensive spending. If OpenAI were to require yearly bundles of it's recent "$120B" deal, that's 6% of the US' discretionary budget. 12.5% of the non-military discretionary budget. (And the military is going to ask for a lot more money this year) Even the idea of just issuing more debt is dubious because they're going to want to do that to pay for the wars that are rapidly spiralling out of control.
None of this is saying that the US government can't or wouldn't pay for it, but it's non trivial and it's unclear how much Altman can threaten the US government "give me a trillion dollars or the economy explodes" without consequences.
Further deficit-spending isn't without it's risks for the US government either. Interests rates are already creeping up, and a careless explosion of deficit may well trigger a debt crisis.
> from public companies (funded with people’s retirement funds)
This would be at great cost. OpenAI would need to open up about it's financial performance to go public itself. With it's CFO being put on what is effectively Administrative Leave for pushing against going public, we can assume the financials are so catastrophic an IPO might bomb and take the company down with it. Nobody's going to be investing privately in a company that has no public takers.
Getting money through other companies is also running into limits. Big Tech has deep pockets but they've already started slowing down, switching to debt to finance AI investment, and similarly are increasingly pressured by their own shareholders to show results.
> from people’s pockets via wealth redistribution upwards
The practical mechanism of this is "AI companies raise their prices". That might also just crash the bubble if demand evaporates. For all the hype, the productivity benefit hasn't really shown up in economy-wide aggregates. The moment AI becomes "expensive", all the casual users will drop it. And the non-casual users are likely to follow. The idea of "AI tokens" as a job perk is cute, but exceedingly few are going to accept lower salary in order to use AI at their job.
There's simply not much money to take out of people's pockets these days, with how high cost of living has gotten.
> from offshore investment.
This is a pretty good source of money. The wealthy Arabian oil states have very deep slush funds, extensively investing in AI to get ties to US businesses and in the hope of diversifying their resource economies.
...
...
"Was". Was a good source of money.
Just look at Cuba, which could be a very rich country and one of the prime tourist destinations of the world.