how can massively buying hardware that will have to be thrown away in a few years be a "good" bubble in the sense of being a lasting infrastructure investment?
Why would that hardware "have to be thrown away"? I've seen quite old GPUs still in use; given the current demand, I expect the vast majority of hardware used in these data centers to see a lot more extended use than most other types of electronics around the world (e.g. phones).
Oh, interesting - it's about failure rate following degradation after prolonged use. I didn't think of that - but my take is that if companies like Google are actually using those components until they 100% exhaust what the components are capable of, then we can argue about whether this use of resources is better than an alternative use of them, but it's by definition not a waste of resources.
I am pretty optimistic that as long as hardware capacity exists, people will find ways of using it. Whether it will be profitable or not is another story of course.
Rivers overflowing with legacy hardware and villages incinerating boards for their metals, and the caustic effects on people & their environment that causes, are already happening. The hardware capacity exists only as long as it is operational and within a few generations. Perhaps we should be careful before building Manhattan-sized data centers.
Up to a point it is better than having additional compute sitting idle at the edge, economies of scale and all that, but after some point it becomes excess and wasteful, even if people figure out ways to entertain themselves with it.
And if people don't want to pay what it costs to improve and maintain these city-sized electronic brains? Then it all becomes waste, or the majority transformed into office or warehouse space or something else.
Proceeding with combined 1% (US GDP)-sized budgets despite this risk being an elephant in the room is what makes it a bubble.
Nvidia had $35.6 billion in data center revenue vs $2.5 billion "Gaming and AI PC" revenue in the 4th quarter of 2024 so data center stuff stuff is like 93% of it
I completely agree with a lot of your points; the whole thing is quite stupid. My only objection is that the infrastructure will probably not go unused. And if we are lucky, those uses will be better than helping teenagers cheat themselves out of a good education.
The prices are falling down. I do a lot of Machine Learning and sometimes work with large datasets. The ability to (1) put all data in VRAM and (2) have the results in hours/days instead of weeks is amazing - and in the past it wouldn't be easy for a normal researcher like me. Now I can have access to these beefy machines, do my research and publish the results without taking a loan from my bank.
One large but forgotten effect of the dotcom bubble was an excess fiber capacity, that allowed smooth growth of internet in the following 25 years---average internet speed in the US is 200 Mbps, and a significant number of households is on a gigabit uplink. I take your point that GPU hardware amortizes away faster than fiber, but that's true of all computing hardware: the average lifecycle of a server is around five years.
that's the point - learning how to train the models and run them at scale is the "infrastructure" funded by the bubble that will be useful after it pops.
I wouldn't call that wasted yet. It's just latent. Someone has to invent the startup that uses dark fibre maps to figure out exactly how far away one can build a house away from civilization and still have a 1000 MB/s connection.