| > Compute Is Becoming a Competitive Moat No, it is not a moat. The story here changes dramatically when you start to look at the facets of the industry that the poster is skipping over. > At the semiconductor level, TSMC’s advanced-node capacity—particularly N3, which underpins much of the AI accelerator ecosystem—is approaching full utilization through at least 2027. MS bought more GPU's than they had rack space for: https://www.datacenterdynamics.com/en/news/microsoft-has-ai-... Open AI bought out the memory: https://x.com/kwharrison13/status/2029248559388746168 but they have no means to consume anywhere close to their order. Meanwhile both google and amazon are consuming a bunch of TSMC capacity to build their own ai chips, bypassing NVIDIA ... And as for them, they seem to be addicted to burning power to keep scaling, and that is a massive problem - if the next gen chips burn more watts for the same amount of work that is only going to exacerbate the power issues were having not help them. Tokens are just Gacha for business. https://en.wikipedia.org/wiki/Gacha_game - It is software you dont control and you are going to pay for a cache miss. That isnt a model that is sustainable (even more so in the authors multi agent flows). At the point that prices come down, (and they will) you're going to see a lot of corporations move from the cloud to on premise or back into colocation. |