Dennys can benefit from higher egg prices if they can lock in long term contracts with suppliers for lower egg prices when smaller companies selling directly to consumers can't.
replyI think that realistically, companies compete against each other as individuals and compete against smaller companies and individuals acting more like cartels/monopolies, and that's what OP is referring to in terms of hardware purchasing/contacts/pricing. This also extends outside of tech to investing, so it's likely not just tech responsible for this.
You got it wrong. Use appliances instead of eggs. If getting an oven gets more expensive I rather keep going to Dennys.
replyIt’s classic capex vs opex. I’d keep paying my openai subscription instead of dropping $3k to run a subpar model. If the thing costs $1k I would consider it.
The big AI companies already have all of the cheap hardware to run on. It's more like if Denny's bought up all of the eggs when prices were normal, held onto them, then kept buying to keep egg prices up.
reply>The big AI companies already have all of the cheap hardware to run on.
replyHave they? Aren't they doing a massive datacenter build-out right now? Moreover the massive profits for Micron and Nvidia must be coming from somewhere, and I doubt it's price-sensitive consumers.
openai etc are going to have a higher utilisation of the hardware so can afford it more than small companies/people. Efficient resource use matters more when they're expensive.
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