Especially for systems for which the workloads are actually bound by GPU compute, network, or storage.
2 months ago there were a load of second gen xeon scalable servers on offer. Now every one of them has had the ram stripped out and its just the chassis on offer.
Fabs are not wasting their time on DDR4 now.
128GB used to be 400$ in June, and now it's over $1,000 for the same 2x64GB set..
I have no idea if/when prices will come back down but it sucks.
Same order, same bill of materials, 17.5K USD per unit today.
That is roughly a 5.5k increase for 768GB of DDR5 ECC memory and the 4 2tb nvme ssds.
Years, or when the AI bubble pops, whatever comes first.
Similar situation with QLC flash and HDDs btw.
It's kinda sad when you grow up in a period of rapid hardware development and now see 10 years going by with RAM $/GB prices staying roughly the same.
A house is $500,000
A GPU is $500
You could put GPUs into the inflation bucket and it wouldn’t change anything. Inflation trackers count cost of living and things you pay monthly, not one time luxury expenses every 4 years that geeks buy for entertainment.
I put my G4 PowerBook into it once, and then vowed never to look at it again.
That period of time had some benefits. Programmers learned to squeeze absolutely everything out of that hardware.
Perhaps writing software for today's hardware is again becoming the norm rather than being horribly inefficient and simply waiting for CPU/GPU power to double in 18 months.
I was lucky. I built my am5 7950x Ryzen pc with 2x48gb ddr5 2 years ago. I just bought 4x48gb kit a month ago with an idea to build another home server with the old 2*48gb kit.
Today my old g.skill 2x48gb kit costs Double what I paid for the 4x48gb.
Furthermore I bought two used rtx3090 (for AI) back then. A week ago I bought a third one for the same price... ,(for vram in my server).
But you’re cherry picking prices from a notable period of high prices (right now).
If you had run this comparison a few months ago or if you looked at averages, the same RAM would be much cheaper now.
We’re just consuming a lot of DRAM in general.
Upgraded by adding 64GB.. last Friday I sold the 32 GB I took out for what I paid for the 64 GB in July... insane
(Including the submitter. In their comment history is "Tip: You can sell used server RAM or desktop modules through BuySellRam to recover value from old hardware." at https://news.ycombinator.com/item?id=45800881 and all of the submissions of this domain are from this user: https://news.ycombinator.com/from?site=buysellram.com )
Old RAM that comes out of the PCs being sold at fire sale prices isn’t really in demand though. Even slower DDR4 grades aren’t seeing much demand.
(That's just me eyeballing it, feel free to do the math)
Nobody is going to do anything if they can't be sure that they'll be able to run the fab they built for a long time and sell most of what they make. Conversely fabs don't tend to idle a lot. Sometimes they're only built if their capacity is essentially sold already. Given how massive the AI bubble is looking right now, I personally wouldn't expect anyone to make a gamble building a new fab.
* Someone explained this at length on here a while ago, but I can't seem to find their comment. Should've favorited it.
"Hyperscalers" already have multi-year contracts going. If the demand really was there, they could make it happen. Now it seems more like they're taking capacity from what would've been sold on the spot or quarterly markets. They already made their money.
Following your reasoning, which is common in manufacturing, the capex needed is already allocated. So, where does the 2x price hike come from if not supply/demand?
The cost to produce did not go up 100%, or even 20%
Actually, DRAM fabs do get scaled down, very similar to the Middle East scaling down oil production.
It absolutely is supply/demand. Well, mostly demand, since supply is essentially fixed over shorter time spans. My point is that "cost per square mm [of wafer]" is too much of a simplification, given that it depends mostly on the specific production line and also ignores a lot of the stuff going on down the line. You can use to look at one fab making one specific product in isolation, but it's completely useless to compare between them or when looking at the entire industry.
It's a bit like saying the cost of cars is per gram of metal used. Sure, you can come up with some number, but what is it really useful for?
https://www.tomshardware.com/pc-components/storage/perfect-s...
...except current peak in demand is mostly driven by build-out of AI capacity.
Both inference and training workloads are often bottlenecked on RAM speed, and trying to shoehorn older/slower memory tech there would require non-trivial amount of R&D to go into widening memory bus on CPU/GPU/NPUs, which is unlikely to happen - those are in very high demand already.
Even China has no reason to reduce prices much for memory sold to the US when they know we have no choice but to buy at the prices already set by the cartel. I expect that if China does start making memory they'll sell it cheap within China and export it at much higher prices. Maybe we'll get a black market for cheap DRAM smuggled out of China though.
So, it would happen even with best intentions and no conspiracies. AI boom already hiked GPU prices, memory was next in line.
If there is high demand for the former due to AI, they can increase production to generate higher profits. This cuts the production capacity of consumer DRAM, and lead to higher prices in that segment too. Simple supply & demand at work.
Each memory DIMM/stick is made up of multiple DRAM chip. ECC DIMMs have an extra chip for storing the error correcting parity data.
The bottleneck is with the chips and not the DIMMs. Chip fabs are expensive and time consuming, while making PCBs and placing components down onto them is much easier to get into.
A consumer DDR5 module has two 32-bit-wide buses, which are both for example implemented using 4 chips which each handle 8 bits operating in parallel - just like RAID 0.
An enterprise DDR5 module has a 40-bit-wide bus implemented using 5 chips. The memory controller uses those 8 additional bits to store the parity calculated over the 32 regular bits - so just like RAID 4 (or RAID 5, I haven't dug into the details too deeply). The whole magic happens inside the controller, the DRAM chip itself isn't even aware of it.
Given the way the industry works (some companies do DRAM chip production, it is sold as a commodity, and others buy a bunch of chips to turn them into RAM modules) the factory producing the chips does not even know if the chips they have just produced will be turned into ECC or non-ECC. The prices rise and fall as one because it is functionally a single market.
I don't really understand why every little thing needs to be spelled out. It doesn't matter. We're not getting the RAM at an affordable price anymore.
Do we really think the current level of AI-driven data center demand will continue indefinitely? The world only needs so many pictures of bears wearing suits.
I feel like the question of how many computers are needed to steer a bunch of self-driving taxis probably has an answer, and I bet it's not anything even remotely close to what would justify a decade's worth of maximum investment in silicon for AI data centers, which is what we were talking about.
In a traditional pork cycle there's a relatively large number of players and a relatively low investment cost. The DRAM market in the 1970s and 1980s operated quite similarly: you could build a fab for a few million dollars, and it could be done by a fab which also churned out regular logic - it's how Intel got started! There were dozens of DRAM-producing companies in the US alone.
But these days the market looks completely different. The market is roughly equally divided up between SK Hynix, Micron, and Samsung. Building a fab costs billions and can easily a year of 5 - if not a decade - from start to finish. Responding to current market conditions is basically impossible, you have to plan for the market you expect years from now.
Ignoring the current AI bubble, DRAM demand has become relatively stable - and so has the price. Unless there's a good reason to believe the current buying craze will last over a decade, why would the DRAM manufacturers risk significantly changing their plans and potentially creating an oversupply in the future? It's not like the high prices are hurting them...
Will the company be evicted from the country in 6 months? A year? Will there be 100% tariffs on competitions imports? Or 0%? Will there be an anti-labor gov’t in effect when the investment might mature, or a pro-labor?
The bigger the investment, the longer the investment timeframe, and the more sane the returns - the harder it is to make the investment happen.
High risk requires a correspondingly high potential return.
That everyone has to pay more for current production is a side effect of the uncertainty, because no one knows what the odds are of even future production actually happening, let along the next fancy wiz-bang technology.
But people do need the current production.
Also worth mentioning DRAM and NAND's profit from Samsung is what keep the Samsung Foundry fighting TSMC. Especially for those who thinks TSMC is somehow a monopoly.
Another things to point out which is not mentioned yet, China is working on both DRAM and NAND. Both LPDDR5 and Stacked NAND are already in production and waiting for yield and scale. Higher Price will finally be perfect timing for them to join the commodity DRAM and NAND race. Good for consumer I suppose, not so good for a lot of other things which I wont go into.
Is this the ‘but he loves me, he wouldn’t hit me again’ of the tech world?
The firms can coordinate by agreeing on a strategy they deem necessary for the future of the industry, and that strategy requires significant capital expenditures, and the industry does not get (or does not want) outside investment to fund it, and if any of the firms defects and keeps prices low the others cannot execute on the strategy, so they all agree to raise prices.
Then, after the strategy succeeds, they have gotten addicted to the higher revenues, they do not allow prices to fall as fast as they should, their coordination becomes blatantly illegal, and they have to get smacked down by regulators.
As long as it doesn't fall into the "collusion" prohibitions of the relevant competition law.
> “People of the same trade seldom meet … but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”
Adam Smith, The Wealth of Nations (1776)
So said and did the infamous Phoebus cartel, to unnaturally "fix" the prices and quality of light bulbs.
https://spectrum.ieee.org/the-great-lightbulb-conspiracy
https://en.wikipedia.org/wiki/Phoebus_cartel
For more than a century, one strange mystery has puzzled the world: why do old light bulbs last for decades while modern bulbs barely survive a couple of years?
The answer lies in a secret meeting held in Geneva, Switzerland in 1924, where the world’s biggest light bulb companies formed the notorious Phoebus Cartel.
Their mission was simple but shocking: control the global market, set fixed prices, and most importantly… reduce bulb lifespan.
Before this cartel, bulbs could easily run for 2500+ hours. But after the Phoebus Cartel pact and actions, all companies were forced to limit lifespan to just 1000 hours. More failure meant more purchases. More purchases meant more profit. Any company who refused faced heavy financial penalties.
The most unbelievable proof is the world-famous Livermore Fire Station bulb in California, glowing since 1901. More than 120 years old. Still alive. While our new incandescent bulbs die in 1–2 years.
Though the Phoebus cartel was dissolved in the 1930s due to government pressure, its impact still shadows modern manufacturing. Planned obsolescence didn’t just begin here… but Phoebus made it industrial.
I still try to fight that habit of not unnecessarily cycling even tho all my lights are LED.
Unfortunately commodity business is not sexy, it doesn't get the press, nor does it get told even in business schools. But a lot of the times these call called price fixing is a natural phenomenon.
I wont even go into what get decided in court doesn't always mean it is right.
I will also add we absolutely want the DRAM and NAND or in fact any industries to make profits, or as much profits as it could. What is far more important is where do they spend not those profits. I didn't look into SK Hynix but both Samsung and Micron spends significant amount of R&D at least try to lower the total production cost of DRAM per GB. We want them to make healthy margin selling DRAM at $1/GB, not losing money and then go bankrupt.
Really wish that I could replace my old skylake-x system but even ddr4 rdimms for an older xeon are crazy now let alone ddr5. Unfortunately I need slots for 3xTitan V's for the 7.450 TFLOPS each of FP64. Even the 5090 only does 1.637 TFLOPS for FP64, so just hopping that old system keeps running.
Close a few Chrome tabs, and save some DDR5 for the rest of us. :-)
You're welcome.
If you are working on an application that has several services (database, local stack, etc.) as docker containers, those can take up more memory. Especially if you have large databases or many JVM services, and are running other things like an IDE with debugging, profiling, and other things.
Likewise, if you are using many local AI models at the same time, or some larger models, then that can eat into the memory.
I've not done any 3D work or video editing, but those are likely to use a lot of memory.
RAM uses power.
However this does not make sense, as for more than a decade the processors have only grown increasing the number of threads, therefore two channels sounds like a negligent and deliberately imposed bottleneck to access the memory if one use all those threads (Lets say 3D render, Video postproduction, Games, and so on).
And if one want four channels to surpass such imposed bottleneck, the mainboards that nowadays have four channels don't contemplate consumer use, therefore they have one or two USB connectors with three or four LAN connectors at prohibitive prices.
We are talking about consumer quad-channel DDR4 machines ten years old, wildly spread, keeps being competent compared with current consumers ones, if not better. It is like if all were frozen along this years (and what remains to be seen with such pattern).
Now it is rumoured that AMD may opt for four channels for its consumer lines due to the increased number of pin connectors (good news if true).
It is a bad joke what the industry is doing to customers.
You need to re-check your sources. When AMD started doing integrated memory controllers in 2003, they had Socket 754 (single channel / 64-bit wide) for low-end consumer CPUs and Socket 940 (dual channel / 128-bit wide) for server and enthusiast destkop CPUs, but less than a year later they introduced Socket 939 (128-bit) and since then their mainstream desktop CPU sockets have all had a 128-bit wide memory interface. When Intel later also moved their memory controller from the motherboard to the CPU, they also used a 128-bit wide memory bus (starting with LGA 1156 in 2008).
There's never been a desktop CPU socket with a memory bus wider than 128 bits that wasn't a high-end/workstation/server counterpart to a mainstream consumer platform that used only a 128-bit wide memory bus. As far as I can tell, the CPU sockets supporting integrated graphics have all used a 128-bit wide memory bus. Pretty much all of the growth of desktop CPU core counts from dual core up to today's 16+ core parts has been working with the same bus width, and increased DRAM bandwidth to feed those extra cores has been entirely from running at higher speeds over the same number of wires.
What has regressed is that the enthusiast-oriented high-end desktop CPUs derived from server/workstation parts are much more expensive and less frequently updated than they used to be. Intel hasn't done a consumer-branded variant of their workstation CPUs in several generations; they've only been selling those parts under the Xeon branding. AMD's Threadripper line got split into Threadripper and Threadripper PRO, but the non-PRO parts have a higher starting price than early Threadripper generations, and the Zen 3 generation didn't get non-PRO Threadrippers.
> Even gaming is now more reliant on GPU performance (which in principle ought to benefit from the high PCIe bandwidth of server parts)
A gaming GPU doesn't need all of the bandwidth available from a single PCIe x16 slot. Mid-range GPUs and lower don't even have x16 connectivity, because it's not worth the die space to put down more than 8 lanes of PHYs for that level of performance. The extra PCIe connectivity on server platforms could only matter for workloads that can effectively use several GPUs. Gaming isn't that kind of workload; attempts to use two GPUs for gaming proved futile and unsustainable.
That number of threads will hit a bottleneck accessing only through to channels of memory.
I don't understand why you brought up the topic of single-threading in your response to the user, given that processors reached a frequency limit of 4 GHz, and 5 GHz with overclocking, a decade ago. This is why they increased the number of threads, but if they reduce the number of memory channels for consumer/desktop...
The OP is talking about a specific niche of boosting single thread performance. It’s common with gaming pcs since most games are single thread bottlenecked. 5% difference may seem small, but people are spending hundreds or thousands for less gains… so buying the fastest ram can make sense there.
It depends. It takes more energy, which can be undesirable in battery powered devices like laptops and phones. Higher end memory can also generate more heat, which can be an issue.
But otherwise more RAM is usually better. Many OS's will dynamically use otherwise unused RAM space to cache filesystem reads, making subsequent reads faster and many databases will prefetch into memory if it is available, too.
$ ~/dev/mozlz4-tool/target/release/mozlz4-tool \
"$(find ~/Library/Application\ Support/Firefox/Profiles/ -name recovery.jsonlz4 | head -1)" | \
jq -r '[.windows[].tabs | length] | add'
5524
Real memory size: 2.43 GB
Virtual memory size: 408.30 GB
Shared memory size: 746.5 MB
Private memory size: 377.3 MB
Building a PC in a cost efficient manner generally requires someone to track parts prices over years, buy parts at different times, and buy at least a generation behind.
The same applies to many other markets/commodities/etc...
Actually, the textile market is pretty volatile in the US these days with Joan's out of business. Pick a poison, I guess? There's little room for stability in a privately-owned-world.
Usually after the companies are fined for price-fixing
When the AI bubble bursts we can get back to the old price
If those retailers didn’t increase their prices when the price hike was announced, anyone building servers would have instantly purchased all of the inventory anyway at the lower prices, so there wouldn’t actually have been weeks of low retail RAM prices for everyone.
Every once in a while you can catch a retailer whose pricing person missed the memo and forgot to update the retail price when the announcement came out. They go out of stock very rapidly.
But that retailer would have made a lot of money in a very short time.
No matter what, you are not getting those modules at the old price. There are few things that trip up people harder than this exact scenario, and it happens everywhere. Concert tickets, limited releases, water during crises, hot Christmas gift, pandemic GPUs, etc.
Once understood you can stop getting mad over it like it's some conspiracy. It's fundamental and natural market behavior.
Those price increases are not normal at all. I understand that most of it still comes from market demands but this is also skewing the market now in unfair manners. Such increases smell of criminal activity too.
You want to penalize companies for buying things and penalize companies for selling things are market rate?
There are a lot of good examples through history about how central planning economics and strict price controls do not lead to good outcomes. The end result wouldn’t be plentiful cheap RAM for you. The end result would be no RAM for you at all because the manufacturers choose to sell to other countries who understand basic economics.
There still isn't a clear path to profitability for any of these AI products and the capital expenditure has been enormous.
Will just have to settle for insanely cheap second hand DDR5 and NVMe drives I guess.
But anyway, the trick is to run it in the winter and keep your house warm.
And while data centers might sign favorable contracts, I don't think they are getting electricity that far below retail.
I could go on, but I think you get the point: the dollar cost for me to run a hypothetical version of Gemini at home far exceeds the price Google pays to deliver the same service to me. I'm effectively arbitraging the price of electricity by subscribing to an LLM service, because I could never run it for anywhere near the same price in my house -- and to provide the service at the speed and reliability of Gemini, I doubt I could even fit the equipment in my house-sized house and still have room for me to live in it.
Anyway, I stand by my original comment - it's neither easy nor cheap to run a frontier model at home.
AI GPUs are stripped away of most things display-related to make room for more compute cores. So in theory, they could "work", but there are bottlenecks making that compute power irrelevant for gaming, even if they had a display output.
Their inventories are not what consumers use.
Consumer DDR5 motherboards normally take UDIMMs. Server DDR5 motherboards normally take RDIMMs. They're mechanically incompatible, and the voltages are different. And the memory for GPUs is normally soldered directly to the board (and of the GDDRn family, instead of the DDRn or LPDDRn families used by most CPUs).
As for GPUs, they're also different. Most consumer GPUs are PCIe x16 cards with DP and HDMI ports; most hyperscaler GPUs are going to have more exotic form factors like OAM, and not have any DP or HDMI ports (since they have no need for graphics output).
So no, unfortunately hyperscalers dumping their inventories would be of little use to consumers. We'll have to wait for the factories to switch their production to consumer-targeted products.
Edit: even their NVMe drives are going to have different form factors like E1.S and different connectors like U.2, making them hard for normal consumers to use.
I put together a small server with mostly commodity parts.
Wrong. It is still just NVMe over PCIe like every other modern SSD form factor.
All you need is a fixed-latency, dumb translator bridge where the adapter forces everything into a simplified JEDEC-compliant mode.
CA/CK Line Translator with a Fixed Retimer as the biggest mismatch between RDIMM/UDIMM is the command/address path.
RDIMMs route CA/CK to RCD to DRAM, and the UDIMMs route CA/CK to DRAM directly, take the UDIMM CA/CK, delay + buffer + level shift it, feed it into a "RCD" like input using a delay locked loops (DLL).
Throw in a SPD translator, PMIC and voltage correction, DQ line conditioning and some other stuff into a 10–12-layer PCB, retimer chips, vrm, and level shifters.
It would cost about $40 million to fab and about $100 per adapter but would make bank with all the spare UDIMMs when the bubble bursts.
HBM/GDDR is not necessarily as useful to the average person as DDR4/DDR5
We're not, and market dictates that they don't have to talk to know to jack up the prices.
This ram price spike is leading Nvidia reporting for this quarter: gross margins were 70 percent. It's looking like their year over year increase in margins (double) is not because it came anywhere close to shipping double the number of units.
Meanwhile if you look at Micron their gross margin was 41% for fiscal year 2025, and 2024 looks to be 24%.
Micron and its peers, are competing with Nvidia for shareholder dollars (the CEO's real customer). Them jacking up prices is because there is enough of the market, dumb enough, to bear it right this second. And every CEO has to be looking at those numbers and thinking the same things: "Where is my cut of the pie, why aren't we at 60 percent".
We're now at a point where hardware costs are going to inhibit development. Everyone short of the biggest players are now locked out, and thats not sustainable. Of the AI ventures there is only one that seems to have a reasonable product, and possibly reasonable financials. Many of the other players are likely going to be able to weather the write downs.
The music will stop, the question is when.
They put ads in the refrigerators. Never buy Samsung anything ever again.
That includes everyone who works in supply chain at big tech. Permanent total boycott.
But for real, that sucks. The alternatives -- much older, used RAM -- may not be very attractive, depending on what you're doing.
Where I live price for my little cluster project gone up from around ~400 usd in july (for 5 node setup) to almost 2000 usd right now. I just refreshed page and it's up by 20% day-to-day. Welp. I guess they are going to stay with 8gb sticks for a while.
https://openai.com/index/samsung-and-sk-join-stargate
The Samsung announcement contains no reference to scaling up production:
https://news.samsung.com/ca/samsung-and-openai-announce-stra...
Semiconductor companies have been bitten in the past by scaling up production into a bubble, so of course Samsung just raises prices. When you buy DRAM, remember that you are financing oligarchs and that Stargate has lied yet again.
They’ve all pretty much 5x’ed YTD. That’s completely wild.
not only is it impossible to build that much power generation on those timelines
it's also not possible to build enough GPUs to fill a purported tripling of US datacenter capacity
what's the ROI on giant empty warehouses full of empty server racks and no electricity?
They can afford to pay more.
We also were looking for DDR4 memory for some older machines and that has shot up 2x as well.
Hate this AI timeline.
I picked up 32GB (2x16GB) DDR4 (CMK32GX4M2E3200C16) last September for $55. Now it's $155.
Now cheapest single stick is $195
And that will result in even more resources being allocated into the "big spenders". We are for a long time, in a death spiral for the whole PC field. If it was not crypto mining (multiple times), then it was HDD mining, then it was pandemic, and now its AI.
What used to be a stable market, that was predictable, has become ultra expensive. And now the whole SSD / DDR pricing are going to hurt even more.
Worst of all is, that a lot of resources are now going to enterprise hardware. So even if the AI bubble goes down, its not like the market will be flooded with cheap NVMEs or cheaper DDR sticks, as that production will have gone into 2.5" U.3 drives and LPDDR memory or the likes.
> hbm chips are now emerging as another bottleneck in the development of those models. Both sk Hynix and Micron, an American chipmaker, have already pre-sold most of their hbm production for next year. Both are pouring billions of dollars into expanding capacity, but that will take time. Meanwhile Samsung, which manufactures 35% of the world’s hbm chips, has been plagued by production issues and reportedly plans to cut its output of the chips next year by a tenth.
If it doesn't, expect years, till enough new capacity will be build
(Not at all)openAI saw they are getting behind their competitors (gpt 5 and 5.1 were progressively worse for my use case - actual problem solving and tweaking existing scripts) are getting better. (Claude and sonnet were miles ahead and I used gpt only due to lower price). Now not only open weights models like Qwen3 and kimik2 exceeded their capability and you can run them at home if you have the hardware or for peanuts on a variety of providers. Cheap-er hardware like strix halo (and Nvidia dgx) made 128gb vram achievable to enthusiast. And Google is eating their punch with Gemini.
All while their CFO starts talking about government bailing them out from spending they cannot possibly fund.
Of course they will attempt to blow up the entire hardware market so if they AI flops they will be able to at least re not you hardware like AWS.
Of course they
Kinda curious how the story
But yeah, both AMD and Intel are also pushing NPU builtin into the higher offerings so there is a very good chance that a good portion of AI will be happening closer and closer to users
Enjoy yohr number goes up fad.
I did have a laptop die because I let it get a little wet.
But when you look at the history of memory, etc, it's certainly going to come back down once the bubble subsides.
Without that competition, everyday consumers are going to get priced out of the market by major corporations. We have reached a point in CPU technology where newer tech is no longer automatically cheaper and faster to make; therefore, we need more competition to keep prices down.
What do you mean?
Who am I kidding, but the such a high increase means these changes are here to stay, it’s not a progressive change at all.
I think there must be a tax of all those AI corporations - they cost us as society WAY too much. We need to bring this into the discussion; right now lobbyists such as the orange king want to ban all discussions therein aka making AI investments exempt from numerous things. This is leeching on the general taxpayers, in all countries. It is not acceptable.
There are a lot of elements to this AI shit-show that I don't like or worry about, but taxing them specifically because they're driving up the price of memory when you want some is not really a "societal cost". You then mention something about "general taxpayers" - didn't you just lobby to make them a super tax payer? Go ahead and rant, but seems like pretty basic supply & demand, and keep some perspective; it's computer memory not bread.
That's part of the reason I think this boom-bust cycle might be a bit different. Hopefully, Intel can use some of its capacity that they have coming up in the foundry to service this need.
it literally was intended for exactly that, it has AI in the name of the cpu, and it was from the get go targeted at AI and GPU heavy workloads (3D rendering etc)
So if the AI bubble does pop in early 2026, you will get a tsunami of cheap server RAM. You still won't be able to find cheap PC RAM. So either way, the short term future of computing is firmly fixed in the cloud.
You get more margins! You get more margins! Everyone's margins go up!
mrsilencedogood•2mo ago
- the insane frothing hype behind AI is showing me a new kind of market failure - where resources can be massively misallocated just because some small class of individuals THINK or HOPE it will result in massive returns. Even if it squeezes out every single other sector that happens to want to use SDRAM to do things OTHER than buffer memory before it's fed into a PCIE lane for a GPU.
- I'm really REALLY glad i decided to buy brand new gaming laptops for my wife and I just a couple months ago, after not having upgraded our gaming laptops for 7 and 9 years respectively. It seems like gamers are going to have this the worst - GPUs have been f'd for a long time due to crypto and AI, and now even DRAM isn't safe. Plus SSD prices are going up too. And unlike many other DRAM users where it's a business thing and they can to some degree just hike prices to cover - gamers are obviously not running businesses. It's just making the hobby more expensive.
Retric•2mo ago
You can blame irrational exuberance, bubbles, or whatnot markets are ultimately individual choices times economic power. Ai, Crypto, housing, Dotcom etc going back through history all had excess because it’s not obvious when to join and when to stop.
Dylan16807•2mo ago
If it was a couple billion dollars of memory purchasing nobody would care.
ben_w•2mo ago
It happens more often than you might expect.
The Onion Futures Act and what led to it is always a fun read: https://en.wikipedia.org/wiki/Onion_Futures_Act
Aerroon•2mo ago
an0malous•2mo ago
Except that these corporations will almost certainly get a bail out, under the auspices of national security or some other BS. The current admin is backed by the same VCs that are all in on AI.
epistasis•2mo ago
There's too much group-think in the executive class. Too much forced adoption of AI, too much bandwagon hopping.
The return-to-office fad is similar, a bunch of executives following the mandates of their board, all because there's a few CEOs who were REALLY worked up about it and there was a decision that workers had it too easy. Watching the executive class sacrifice profits for power is pretty fascinating.
Edit: A good way to decentralize the power and have better decision making would be to have less centralized rewards in the capital markets. Right now are living through a new gilded age with a few barons running things, because we have made the rewards too extreme and too narrowly distributed. Most market economics assumes that there's somewhat equal decision making power amongst the econs. We are quickly trending away from that.
smallmancontrov•2mo ago
automatic6131•2mo ago
epistasis•2mo ago
Perhaps a better approach to anti-monopoly and anti-trust is possible, but I'm not sure anybody knows what that is. Khan was very well regarded and I don't know anybody who's better at it.
Another approach would be a wealth and income taxation strategy to ensure sigmoid income for the population. You can always make more, but with diminishing returns to self, and greater returns to the rest of society.
sharts•2mo ago
CamperBob2•2mo ago
adgjlsfhk1•2mo ago
CamperBob2•2mo ago
Don't pick a fight with people who buy ink by the barrel and bandwidth by the exabyte-second. Or at least, don't do it a month before an election.
jordanb•2mo ago
That being said, Kamala's refusal to run on Kahn's record definitely helped cost her the election. She thought she could play footsie with Wall Street and SV by backchanneling that she would fire Kahn, so she felt like she couldn't say anything good about Kahn without upsetting the oligarchs, but what she was doing was really popular.
aerhardt•2mo ago
vlovich123•2mo ago
epistasis•2mo ago
fpoling•2mo ago
logancbrown•2mo ago
wqaatwt•2mo ago
Terr_•2mo ago
The latter would have to be backstopped by taxes on individual income.
octoberfranklin•2mo ago
Hikikomori•2mo ago
steve_b•2mo ago
esseph•2mo ago
Hikikomori•2mo ago
silon42•2mo ago
thfuran•2mo ago
philipkglass•2mo ago
octoberfranklin•2mo ago
Chip fabs used to be like book publishers; you don't have to own a printing press to be an author. Carver Mead even described his vision of the industry that way.
Nowadays you have to get your cell libraries and a large chunk of your toolchain from the fab. Of course it's laundered through cadence+synopsys, but it's still coming from the fab. You have to buy your masks from the fab (heck they aren't even allowed to leave the fab so do you really own them?). And on and on.
For the record I don't agree with the "exponential" part, but otherwise this is an underappreciated and powerful technique.
philipkglass•2mo ago
zer00eyz•2mo ago
I can still make a book like that in my basement. People do this as a hobby now. You can still build chips like that in your garage. People do this as a hobby now.
These things DO NOT SCALE... you cant have 10,000 people running printing presses in their basement to crank out the NYT every day. A modern chip fab has more in common with the printer for the NYT than it does with what you can crank out in your garage.
Let's look at TSMC's plant in AZ. They went and asked intel "hey where are you sourcing your sulfuric acid from. When they looked at the American vendors TSMC asked intel "how are you working with this". Intels response was that it was the best they could get.
It was not.
TSMC now imports sulfuric acid from Taiwan, because it needs to be outrageously pure. Intel is doing the same.
Every single part, component, step and setup in the chain is like that. There is so much arcane knowledge that loss of workers represents a serious set back. There are people in the production chain, with PHD's, who are literally training their successors because thats sort of the only option.
Do you know who has been trying the approach you are proposing? China. It has not worked.
https://www.youtube.com/asianometry probably the best rough and ready education you can get on the industry.
kasabali•2mo ago
> https://www.youtube.com/asianometry probably the best rough and ready education you can get on the industry.
I would take anything from that channel regarding China with a pinch of salt.
15155•2mo ago
You can absolutely manufacture a convincingly-professional, current-generation book in your basement with a practically-small capital investment.
You cannot manufacture a convincingly-professional chip (being generous: feature size and process technology from the last two decades) in your basement without a 6-7 figure capital expenditure, and even then - good luck.
therealcamino•2mo ago
The complexity of actual fabrication was always, and still is, entirely within the foundry. But in the early days of that model, designs could be more easily handed off at the logical level, leaving the physical design to back end companies, which makes designs much more portable between foundries. (The publisher analogy.) What's changed is that the complexity of physical design has exploded, and you can't make the handoff at nearly as high a level, and there is much more work that depends directly on the specific process you are targeting. Much more work at the physical level falls to the fabless semi companies. So it is much more work to retarget a design to a different foundry or process.
AnthonyMouse•2mo ago
This is in the right spirit but you want two things to be different about it.
The first is that the threshold for a given industry doesn't make sense as a dollar amount, it makes sense as a market share percentage. Having more than 15% market share should be a thing companies don't want, regardless of whether it's a $100 trillion industry or a $100 million one.
And the second is that taxes create a perverse incentive for the government. You absolutely do not want the government to have even more of a financial incentive to sustain and create more of the companies of that size. What you want is to have fewer of them.
So, what you want is a rule that if a company has more than 15% market share, the entire general public is allowed to sue them into bankruptcy for the offense of market consolidation. Which also removes the problem where they buy off the government prosecutors, because if they commit the offense then anybody can sue them.
chii•2mo ago
who bears the costs of this suit?
And who determines what makes for a good market share size to be the threshold?
And by having such a rule, an industry that would have higher efficiency to when consolidated would not be able to (but you wouldn't know). It's a bad set of policy imho.
A better way would be for gov't to increase competition by adding supply, or demand, whichever one is the bottleneck to competition. If a company, such as AWS, is getting a lot of marketshare, but their profit margins is still high, then the gov't should incentivize competition by funding or giving loans to businesses that want to compete with AWS.
However, if AWS's profit margins, even at high market share, remains very low (e.g., amazon's commerce side), then there's no need for the gov't to "step in" at all, as there would be no incentive for any competitor to try enter the market due to low margins.
AnthonyMouse•2mo ago
The goal is to not have it happen, because the company is going to see that they're only slightly below the threshold and voluntarily split themselves into smaller pieces and buy themselves a safety margin because if they don't everybody knows the lawsuits are going to vaporize them once they exceed the threshold.
> And who determines what makes for a good market share size to be the threshold?
Anything in the vicinity of 5%-15% would be fine.
> And by having such a rule, an industry that would have higher efficiency to when consolidated would not be able to (but you wouldn't know).
This is extremely rare and the circumstances where it happens aren't a mystery. It's when entering the market has extremely high fixed costs but then the unit cost of usage is negligible, e.g. it costs a huge amount of money to install water and sewer but then the incremental cost of someone washing their hands is insignificant.
For those things you either have the government do them, or if it's a private company then it's a regulated utility which is completely banned from anything that even vaguely resembles vertical integration as the price of being allowed to have more than the threshold amount of market share.
> A better way would be for gov't to increase competition by adding supply, or demand, whichever one is the bottleneck to competition.
The problem is generally caused by the incumbents capturing the government and then enacting rules that inhibit rather than increase competition. That's why you need anyone to be able to initiate the lawsuit, so they can't capture the government department which is supposed to be thwarting them because then it's the entire public.
chii•2mo ago
so why not solve this issue directly? Transparency, auditing and public awareness etc are needed to prevent regulatory capture. Public apathy are the reason why it is currently "easy" to do capture regulators.
The fact is even if a law suit is possible from anyone in the public, no one is going to pay to do a law suit (which has costs), when the result doesn't net them more profit. So unless the law suit enables the accuser to wholesale take a piece of that company as private property from the owners - which no law currently would allow nor have precedents for - why would anyone expend private money for a public good?
And in any case, i don't the apathy going away, even if the law suit was free. Because currently, the same apathy is allowing regulatory capture in the first place. So solving public apathy first, and foremost, is the solution.
AnthonyMouse•2mo ago
It's mostly easy because the people doing it are good at lying. When they create a rule it isn't called the "mandate this company's product rule" or the "increase fixed costs to lock out smaller competitors rule", it's sold as a safety measure or consumer protection or some other pretext, even though the effect is to raise costs to the benefit of the companies getting the money or exclude competitors to the benefit of the incumbents.
Or they simply don't prosecute antitrust violations, and then there is nothing to audit because there is nothing happening, meanwhile people are kept distracted with other things.
> The fact is even if a law suit is possible from anyone in the public, no one is going to pay to do a law suit (which has costs), when the result doesn't net them more profit.
It does net them more profit. The premise is that having more than the threshold amount of market share is a strict liability antitrust violation, which allows any customer or prospective customer (i.e. anyone) to sue them for it. The person who files the lawsuit would get the money, the same as someone who sues a company for pollution or fraud.
The point of letting people sue you for polluting or fraud or, in this case, market consolidation, isn't to make plaintiffs rich, it's to deter the thing you don't want companies to do. The goal isn't to have a lot of lawsuits, the goal is to have companies not want the market to consolidate and actively prevent it because if it happens they'll get sued.
> So solving public apathy first, and foremost, is the solution.
Apathy is cyclical. People don't care until the problem gets bad enough, then they care enough to demand change and make it go away for a while, then they stop caring until it gets bad enough again.
But you don't want people to have to die or get severely abused before the problem gets addressed. What you want is to change the structure of the system to prevent it from getting that bad to begin with, by making sure that the power to nip the problem in the bud (i.e. stop market consolidation at 5% or 15% instead of 50% or 90%) is held by someone who will actually exercise it, which can be accomplished by granting that power to everyone affected, which in this context is each and every member of the public.
1718627440•2mo ago
That's not really a convincing argument. The government is the body for setting up the economic rules, it is not bound by it. The government doesn't have revenue or profit. Money is created by the government, it doesn't have a value yet. The direct financing of actions through taxes is not done for the government, but a way for the government to project the costs of the governmental action into the economy. Sure, there are a lot of idiots now-a-days, that think a state should work like a business and make profits, but they are misled.
AnthonyMouse•2mo ago
When a new law is proposed, the Congressional Budget Office prepares a report on the impact it will have on the budget.
Now suppose a new law is proposed that will remove an existing unfair advantage of large companies over small ones, causing more small companies to form and take market share from incumbent larger ones. If large companies pay a 50% tax rate and small companies pay a 10% tax rate, the CBO analysis will show tax revenue going down. Then in order to make up the shortfall at a given level of deficit spending, the government would have to raise taxes or reduce spending, both of which are unpopular, so instead the bill gets tabled and the huge companies retain their unfair advantage. That's the perverse incentive we don't want to see.
> Money is created by the government, it doesn't have a value yet.
If the government can create an unlimited amount of money with no drawbacks, why don't they just send everyone a check for a trillion dollars? If they can't then whatever they want to spend in excess of what they can get away with printing or borrowing has to come from tax revenues, and then what happens when you set up an incentive structure where the government gets more money to spend the bigger they allow companies to get?
> Sure, there are a lot of idiots now-a-days, that think a state should work like a business and make profits, but they are misled.
This is a straw man. The only people who think the government should make a net profit are the people trying to build some kind of sovereign wealth fund. The US government isn't doing anything even resembling that -- it has been running massive deficits for decades. It's to the point that interest on the debt is now a major component of the budget -- we're now spending about as much on interest as on Medicare.
Aloisius•2mo ago
Well, assuming they haven't revived the cartel.
Melatonic•2mo ago
scotty79•2mo ago
The only saving grace is that it can die and others will scoop up released resources.
When country level planned economy dies, people die and resources get destroyed.
xpe•2mo ago
This is confused. Here is how classical economists would frame it: a firm chooses how much to produce based on its cost structure and market prices, expanding production until marginal cost equals marginal revenue. This is price guided production optimization, not central planning.
The dominant criticism of central planning is trying to set production quantities without prices. Firms (generally) don’t do this.
scotty79•2mo ago
xpe•2mo ago
And of course I will grant firms use hierarchical coordination mechanisms internally (managers allocate resources by command rather than prices).
I suppose my angle here is to be clear that firms are typically a kind of hybrid entity: they mix various coordination mechanisms (prices and hierarchy). This makes them quite different from centrally planned economies.
scotty79•2mo ago
xpe•2mo ago
Next, to avoid a definitional stalemate and talking past each other, let me try a different angle. If you want to predict what a company will do next, what mix of models do you use upon?
If I were to predict a company’s production choices, I would model them as being very sensitive to costs and changing dynamics to maximize profit . I would not do that when modeling a centrally planned economy. For that I would use longer time scales and do long supply chain analysis in the service of a social welfare function. See what I mean? What am I missing from your POV?
scotty79•2mo ago
You describe politics not market economy. It was fully present in communist, state wide, planned economies.
xpe•2mo ago
If you want to add “politics” to your causal map, that’s fine too. Reality is multi-factor. I do not deny that leaders make (to varying degrees) political and-or command-and-control decisions. This was already baked into the conversational context. Please take the conversational history into account.
xpe•2mo ago
I wouldn’t phrase it this way — to me, this implies unpredictability and/or a lack of rationale. Perhaps you simply mean “internal managers at companies do not necessarily price resources using market mechanisms” which I would agree with.
Many fields of study give insight to the various kinds of distortions that arise from human psychology and negotiation, etc.
scotty79•2mo ago
Exactly, same as in centrally planned economy.
1718627440•2mo ago
That's the case in a healthy competitive market. Once you have a monopoly or an oligopoly, you get into central planning territory.
xpe•2mo ago
Economists have concepts and models for monopolies and oligopolies — and the way they operate are quite different from the practice of central planning.
I’m talking from within the frame of economic concepts, and I’m striving to use words as understood in the field. At times I value metaphorical thinking, but here in the case of economics, we don’t need to bend words when other fitting concepts are readily available and battle-tested.
An example: If someone calls corporate consolidation “central planning,” they’ve lost the ability to analyze it properly. The relevant questions for oligopolies (strategic behavior, barriers to entry, tacit collusion) are completely different from central planning questions (calculation problems, information aggregation, incentive alignment).
When technical fields have already solved a conceptual problem through careful definition and model building, importing loose metaphorical language degrades analytical clarity.
If you want to point to or propose a different model than the usual economic dogma, I’m all ears, by the way.
1718627440•2mo ago
The claim isn't that it is exactly like central planning like a state, but very similar through the view on the whole society. You have a powerful caucus, no longer bound by reality (competition), making decisions, that they think are good, which effectively set the pace for the whole economy field. Whether this caucus formed through rigged elections or by inheritance of companies isn't all that relevant. It would be quite a different story, if the state would enforce its monopoly on (political) power and governing, but it refuses to do so now-a-days.
> The relevant questions for oligopolies (strategic behavior, barriers to entry, tacit collusion) are completely different from central planning questions (calculation problems, information aggregation, incentive alignment).
The observation on these oligopolies, that are now larger than some states is, that they seem to lack in their strategic reasoning and are more built on vibes of their leader, which is subject to blindness due to sycophants, much like in an authoritarian regime. Also they tend to treat the whole market as their internal planning problem.
> but here in the case of economics, we don’t need to bend words when other fitting concepts are readily available and battle-tested.
I think a majority of commenters on HN are not as well-versed in Economics as you, so would value elaboration on modern monopolies. I think they differ a bit from classical monopolies in their amount of ties to the government and interference into elections. Not that lobbying isn't typical for monopolies, but modern monopolies seem to not need to lobby anymore, but simply do and dictate.
xpe•2mo ago
Yes, there are several problems with oligopolies and monopolies. You referred to one: a kind of blinkered irrationality. Also, capable and strategic self-interest can threaten free markets.
I don’t expect readers here to have the equivalent of a US bachelor degree in economics (though I think this is likely to be a valuable skillset to learn in one’s free time).
Still, I’m hoping they can recognize when they’re stepping into an unfamiliar realm and pay attention to the feeling of “seems like economists are using certain words in particular ways that I should dig into rather than treat them as known vocabulary.” Achieving this level of self-awareness is probably hard for many. To build a deep sense of intellectual honesty and self-awareness of one’s cognitive limitations, I think one can do worse than working closely and intensely with others who also care about these traits. Mentorship helps.
Back to Econ… It also helps to remember in much of economists, these terms are founded in mathematical models. So the interpretation might be subjective, but the mathematical model (the operations) are formalized.
PunchyHamster•2mo ago
Ideally. Realistically in market with only few companies around it makes it even less competitive.
scotty79•2mo ago
sharts•2mo ago
xpe•2mo ago
wat10000•2mo ago
yunnpp•2mo ago
1718627440•2mo ago
kace91•2mo ago
At least before there was a certain common baseline derived from everyone watching the same news and reading the same press. Now they are just as enclosed in their thought bubbles as everyone else. It is entirely possible for a tech CEO to have a full company of tech workers despising the current plan and yet that person being constantly reinforced by linkedin and chatgpt.
Loughla•2mo ago
I remember first hearing the phrase "yes man" in relation to a human ass kisser my dad worked with in like 1988.
It's very easy to unknowingly surround yourself with syncophants and hangers on when you literally have more money than some countries. This is true now and has been true forever. I'm not sure they're more out of touch, as much as we're way more aware?
ryandrake•2mo ago
nine_k•2mo ago
mk89•2mo ago
I think you're underestimating a bit. We must implement AI because they were able to sell it so good that they got billion $ investors (see all the money coming from Qatar/saudi arabia etc). That's a lot of money coming in that allows to innovate/etc.
ryandrake•2mo ago
I swear that every 5-10 years, corporate CEOs all get together in a secret meeting where they all agree on the next buzzword technology. They invite Harvard Business Review and the tech press to give them their marching orders. Then, finally, the white smoke comes forth from the chimney indicating the next bubble buzzword has been chosen, and the industry goes bananas over it for 10 years for no reason.
1718627440•2mo ago
mk89•2mo ago
It "could be anything", but the current AI trends/updates are really impressive. This is why they are investing.
If we reach a limit in the next 5 years, so be it. But it's driving and pushing for a paradigm shift in the way things work - search, coding, tooling, etc. It touches almost anything people do, not a specific group of people, but society as a whole.
nine_k•2mo ago
ryandrake•2mo ago
gruez•2mo ago
It's a form of "centralized planning", except it's not centralized at all.
someguyiguess•2mo ago
themafia•2mo ago
I think this is actually the long tail of "too big to fail." It's not that they're all thinking the same way, it's that they're all no longer hedging their bets.
> we have made the rewards too extreme and too narrowly distributed
We give the military far too much money in the USA.
makeitdouble•2mo ago
~ themafia, 2025
(sorry)
On a more serious note the military is sure a money burning machine, but IMHO it's only government spending, when most of the money in the US is deliberately private.
The fintech sector could be a bigger representation of a money vacuuming system benefiting statistically nobody ?
wat10000•2mo ago
themafia•2mo ago
It's also the case that none of the CIA, NSA or DHS budgets show up under the military, even though they're performing some of the same functions that would be handled by militaries in other countries.
We also have "black appropriations." So the total of the spending on surveillance and kinetic operations is often unknowable. Add to this the fact the Pentagon has never successfully performed an audit and I think people are right to be suspicious of the topline "fraction of GDP" number.
nirav72•2mo ago
themafia•2mo ago
At least not in the data set I use:
https://www.usaspending.gov/explorer/agency
Melatonic•2mo ago
Projectiboga•2mo ago
wat10000•2mo ago
Comparing budgets by adjusting for inflation doesn't make any sense. A budget that served a country of 218 million in 1976 would, when adjusted for inflation, serve a country of 218 million in 2026. Percentage of GDP is what you want to look at.
Aerroon•2mo ago
Budget-to-GDP ratio in the US is close to 40%. (On that note, you should really consider federal + state combined rather than just federal.)
In early 1900s this same ratio was around 5-10%.
It has been increasing pretty much everywhere during the 20th century. It has made me wonder whether much of the prosperity we've seen and felt might not be a result of this ever-increasing percentage. Essentially we're spending more and more and that makes it feel like we're progressing faster than we are. Eventually it's going to have to stop though and I dread what happens when we do.
themafia•2mo ago
https://www.cbo.gov/publication/59946
wat10000•2mo ago
I don't see why we'd eventually have to stop this level of spending. The debt is unsustainable, but that's a policy choice to keep taxes too low for the level of spending we've chosen.
lotyrin•2mo ago
PunchyHamster•2mo ago
I don't think there is even a good solution for that. Govt could essentially sponsor some competition but that's easy to go from "helping to market" to "handouts for incompetent"
wat10000•2mo ago
But the power concentration is a strong reason. That level of wealth is incompatible with democracy. Money is power, and when someone accumulates enough of it to be able to personally shake entire industries, it's too much.
Aerroon•2mo ago
wat10000•2mo ago
Aerroon•2mo ago
wat10000•2mo ago
What you're saying basically boils down to: kings are inevitable, might as well choose them by economic success instead of the more old-fashioned approaches. I reject the first part.
Aerroon•2mo ago
First, if the people can incentivize the government enough to tax the wealthy with outrageous amounts, then those same people will demand regulation on everything whenever something goes wrong. You end up with a poor country this way. Second, the wealthy can just leave or influence the policy to be changed.
Also, the irony is that the US is already one of the best countries when it comes to taxing the wealthy instead of the poor. You don't have a 20-25% VAT that applies to everything you buy. You have a progressive income tax and your payroll tax (that avoids the progressive part) isn't a giant ~30% of gross income. You don't have giant excise taxes on things like gasoline that makes everything more expensive (including food). You also generally don't have punitive taxes on things that poor people buy a lot of, like sodas and similar.
The list above are things that are done by (a lot of) European countries. Our "welfare states" don't exist because rich people pay a large share, it's because everyone does.
1718627440•2mo ago
It's avoidable by formalizing the execution of power. The head of state is very powerful, but he can't create laws or anything. That all needs to be done be the parliament, which is several hundred people.
Aerroon•2mo ago
Sure, the US does it differently, yet the parliament seems to often just not do anything and let courts legislate instead. Then you end up in this weird situation where the supreme court positions end up being extremely partisan to set the "correct" precedent.
Either way there's a lot of power in the executive in either system.
aianus•2mo ago
Ray20•2mo ago
A centralized authority capable of so severely restricting the economic freedom of the most powerful people implies a far greater concentration of power than the one you're fighting against. You're proposing to cure the common cold with AIDS.
wat10000•2mo ago
1718627440•2mo ago
Yes. That's the idea. Make the largest concentration of power an elected body auditable by the commons and whose actions are formalized by a bunch of rules, that they can choose, but still need to stick to.
Ray20•2mo ago
So, billionaires are bad because they can use their money to enter into voluntary deals with other people, which can lead to them achieving goals we don't like. Therefore, we create a single point of concentration of power with totalitarian control and dictatorial powers, that can take resources from people they don't like and give those resources to others they do like.
And these people with totalitarian control over the commons and dictatorial powers over the commons and the most powerful lever on everyone whatsoever and especially on everyone with huge amount of money, will continue to be electable and auditable by the commons because... I don't know, probably because they feel like it, there is literally no other reasons or incentives for them to do so.
"Big money give a human to much power, so let's take all that power from EVERYONE, concentrate it in ONE PLAСE, and add to this power dictatorial powers and totalitarian control over society. Some might argue that this is the exact opposite of the stated goals of the whole undertaking, but they do not take into account the insurmountable protection in the form of MAGICAL RULES with the help of which society will be able to control all of this"
wat10000•2mo ago
What matters to power is people, not places. Having power concentrated in one place, made up of hundreds of people who are elected and can be replaced, is fine. Having power concentrated in one or a few people is where things go wrong.
est31•2mo ago
But yeah in the end companies behave in trends, if some companies do it then the other companies have to do it too, even if this makes things less efficient or is even hurtful. We can put that onto the human factor, but I think even if we replaced all CEOs with AIs, those AIs would all see the same information and make similar decisions on those information.
There is pascal's wager arguments to be had: for each individual company, the punishment of not playing the AI game and missing out on something big is bigger than the punishment of wasting resources by allocating them towards AI efforts plus annoying customers with AI features they don't want or need.
> Right now are living through a new gilded age with a few barons running things, because we have made the rewards too extreme and too narrowly distributed.
The usa has rid itself multiple times of its barons. There is mechanisms in place, but I am not sure that people really are going to exercise those means any time soon. If this AI stuff is successful in the real world as well, then increasing amounts of power will shift away from the people to the people controlling the AI, with all the consequences this has.
mrtksn•2mo ago
In theory I guess this creates a demand that should be satisfied by the market but in reality it seems like when the wealth is too concentrated in the hands of the few that call all the decision the market is unable to act.
drysine•2mo ago
No, it's pure capitalism where Atlas shrugged and ordered billions worth of RAM. You might not like it but don't call it "centralized planning" or "Soviet era".
Retr0id•2mo ago
smallmancontrov•2mo ago
Unfortunately, that doesn't seem to be the flavor of politics on tap at the moment.
Sam Altman cornering the DRAM market is a joke, of course, but if the punchline is that they were correct to invest this amount of resources in job destruction, it's going to get very serious very quickly and we have to start making better decisions in a hurry or this will get very, very ugly.
swatcoder•2mo ago
There are potentially undesirable tradeoffs and a whole new game of cheats and corruption, but you could frustrate rapid, concentrated growth with things like an increasing tax on raised funds.
Right now, we basically let people and companies concentrate as much capital as they want, as rapidly as they want, with almost no friction, presumably because it helped us economically outcompete the adversary during the Cold War. Broadly, we're now afraid of having any kind of brake or dampener on investments and we are more afraid of inefficiency and corruption if the government were to intervene than we are of speculation or exploitation if it doesn't.
In democratically regulated capitalism, there are levers to pull that could slow down this kind of freight train before it were to get out of control, but the arguments against pulling them remain more thoroughly developed and more closely held than those in favor of them.
amelius•2mo ago
Care to share some keywords here?
thfuran•2mo ago
thfuran•2mo ago
octoberfranklin•2mo ago
Yeah I know HN is going to hate me for saying that.
If a big company and a few small companies all have identical costs for producing a product, society is better served by having it produced by the few small companies than the one big company.
Once "better served" is quantified, you know the coefficient for taxation.
Make no mistake, this coefficient will be a political football, and will be fought over, just like the Fed prime interest rate. But it's a single scalar instead of a whole executive branch department and a hundred kilopages of regulations like we have in the antitrust-enforcement clusterfuck. Which makes it way harder to pull shenanighans.
zozbot234•2mo ago
Why? That's exactly the circumstances where the mere potential for small companies to pop up is enough to police the big company's behavior. You get lower costs (due to economies of scale) and a very low chance of monopolization. so everyone's happy. In the case of this DRAM/flash price spike, the natural "small" actors are fabs slightly off the leading edge, that will be able to retool their production and supply these devices for a higher profit.
octoberfranklin•2mo ago
If that were true, "you're in Amazon's kill zone" wouldn't be something VC's say to startups. And yet, they do say that.
Ray20•2mo ago
octoberfranklin•2mo ago
refurb•2mo ago
How so? Costs will be higher with multiple small products, resulting in higher costs for customers. That's the opposite of "society is served better".
We draw the line at monopolies, which makes sense.
lenkite•2mo ago
Best to nip corpos before they gain more revenue than a nation state and become "too big to fail".
octoberfranklin•2mo ago
> Costs will be higher
Read it again, please.
refurb•2mo ago
duskdozer•2mo ago
well, assuming the scale couldn't be used for the benefit of society and not to milk it dry. but yes probably the best that can have a reasonable chance at success, eventually, maybe.
fabian2k•2mo ago
The only way the massive planned investments make sense is if you think the winner can grab a very large piece of a huge pie. I've no idea how large the pie will be in the near future, but I'm even more skeptical that there will be a single winner.
sixothree•2mo ago
The more I dream about the possibilities of AR, the more I believe people are going to find it incredibly useful. It's just the hardware isn't nearly ready. Maybe I'm wrong but I believe these companies are making some of the largest strategic blunders possible at this point in time.
sokoloff•2mo ago
sixothree•2mo ago
testartr•2mo ago
maybe AI cures cancer, or at least writes some code
ptero•2mo ago
fzeroracer•2mo ago
natebc•2mo ago
XorNot•2mo ago
missedthecue•2mo ago
selfhoster11•2mo ago
eldenring•2mo ago
hakfoo•2mo ago
The tone from the AI industry sounds more like a dependent addict by comparison. They're well past the phase where they're enjoying their fix and into the "please, just another terawatt, another container-ship full of Quadros, to make it through the day" mode.
More seriously, I could see some legitimate value in saying "no, you can't buy every transistor on the market."
It forces AI players to think about efficiency and smarter software rather than just throwing money at bigger wads of compute. This might be part of where China's getting their competitive chops from-- having to do more with less due to trade restrictions seems to be producing some surprisingly competitive products.
It also encourages diversification. There is still no non-handwavey road to sustainable long-term profitability for most of the AI sector, which is why we keep hearing answers like "maybe the Extra Fingers Machine cures cancer." Eventually Claude and Copilot have to cover their costs or die. If you're nVidia or TSMC, you might love today's huge margins and willing buyers for 150% of your output, but it's simple due diligence to make sure you have other customers available so you can weather the day the bubble bursts.
It's also a solid PR play. Making sure people can still access the hobbies they enjoy is an easy way to say you're on the side of the mass public. It comes from a similar place to banning ticket scalping or setting reasonable prices on captive concessions. The actual dollars involved are small (how many enthusiast PCs could you outfit with the RAM chips or GPU wafer capacity being diverted to just one AI data centre?) but it makes it look like you're not completely for sale to the highest bidder.
scotty79•2mo ago
That's basically what the rich usually do. They command disproportionate amount of resources and misallocate them freely on a whim, outside of any democratic scrutiny, squeezing incredible number of people and small buisness out of something.
Whether that's a strength of the system or the weakness, I'm sure some rearch will show.
tonyhart7•2mo ago
amelius•2mo ago
tonyhart7•2mo ago
TinkersW•2mo ago
I would call that market manipulation(or failure if you wish)--in a just society Sam Alton would be heading to prison.
1718627440•2mo ago
shiandow•2mo ago
lazide•2mo ago
It’s a classic ‘tulip bubble’.
missedthecue•2mo ago
lazide•2mo ago
The actual underlying models of productive output for these AI tools is a tiny fraction (actually) of the mania, and can be trivially produced at massive quantity without the spend that is currently ongoing.
The big bubble is because (like with tulips back then), there was a belief in a degree of scarcity (due to apparent novelty) that didn’t actually exist.
fragmede•2mo ago
lazide•2mo ago
Anyone who owns shares in US companies (most people here) both are ‘going home with’ the companies involved, and are buying ‘the bags’.
Not to mention all the people buying the bonds used to fund the whole AI data center buildout, which is a ton of probably pension funds and old folks planning for retirement (also probably more than a few millionaire/billionaires!).
fragmede•2mo ago
lazide•2mo ago
christophilus•2mo ago
parineum•2mo ago
It's a little ironic but to call this a market failure due to resource misalocation because prices are high when high prices is how misalocation is avoided.
I'm a little suspicious that "misalocation" just means it's too expensive for you. That's a feature, not a bug.
noosphr•2mo ago
We have been living on the investment of previous centuries and decades in the West for close to 40 years now. Everything is broken but that didn't matter because everything that needed a functioning physical economy had moved to the East.
AI is the first industrial breakthrough in a century that needs the sort of infrastructure that previous industrial revolutions needed: namely a ton of raw power.
The bubble is laying bare just how terrible infrastructure is and how we've ignored trillions of maintenance to give a few thousand people tax breaks they don't really need.
lawlessone•2mo ago
Is it?
abalashov•2mo ago
incompatible•2mo ago
noosphr•2mo ago
The British didn't industrialise Indian for a reason.
lenkite•2mo ago
https://en.wikipedia.org/wiki/De-industrialisation_of_India
BadBadJellyBean•2mo ago
lm28469•2mo ago
All the infrastructure will be useless when the data centers move to the next city/state offering a tax cut.
noosphr•2mo ago
lm28469•2mo ago
noosphr•2mo ago
You are being obtuse for the sake of AI doomerism.
outside1234•2mo ago
haunter•2mo ago
abalashov•2mo ago
This resonates deeply, especially to someone born in the USSR.
lovich•2mo ago
As someone who advocates that we only use capitalism as a tool in specific areas and try to move past it in other, I’ll defend it here to say that’s not really a market anymore when this happens.
Hyper concentration of wealth is going to lead to the same issues that command economies have where the low level capital allocations(buying shit) isn’t getting feedback from everyone involved and is just going off one asshole’s opinion
xpe•2mo ago
Technically speaking, this is not a market failure. [1] Why? Per the comment above, it is the individuals that are acting irrationally, right? The market is acting correctly according to its design and inputs. The market’s price adjustment is rational in response. The response is not necessarily fair to all people, but traditional styles of neoclassical economic analysis deaccentuate common notions of fairness or equality; the main goal is economic efficiency.
I prefer to ask the question: to what degree is some particular market design serving the best interest of its stakeholders and society? In democracies, we have some degree of choice over what we want!
I say all of this as a person who views markets as mechanisms not moral foundations. This distinction is made clear when studying political economic (economics for policy analysis) though I think it sometimes gets overlooked in other settings.
If one wants to explore coordination mechanisms that can handle highly irrational demand spikes, you have to think hard. To some degree, one would have to give up a key aspect of most market systems — the notion of one price set by the idea of “willingness to pay”.
[1] Market failure is a technical term within economics meaning the mechanism itself malfunctions relative to its own efficiency criteria.
elorant•2mo ago
bongodongobob•2mo ago
yunnpp•2mo ago
fooey•2mo ago
phito•2mo ago
adastra22•2mo ago
layoric•2mo ago
Currently we are still at the stage of extraction from the upper/middle class retail investors and pension funds being sucked up by all the major tech companies that are only focused on their stock price. They have no incentive to compete, because if they do, it will ruin the game for everyone. This gets worse, and the theory (and somewhat historically) says it can lead to war.
Agree with the analysis or not, I personally think it is quite compelling to what is happening with AI, worth a watch.
Melatonic•2mo ago
And if the market crashes or takes a big dip then temporarily eBay will flood with high end stuff at good prices.
Sucks for anyone who needs to upgrade in the next year or two though !
refurb•2mo ago
I see people using "market failure" in weird ways lately. Just because someone thinks a use for a product isn't important, doesn't mean it's a market failure. It's actually the opposite - consumers are purchasing it at a price they value it.
Someone who doesn't really need 128GB of ram won't pay the higher cost, but someone who does need it will.
immibis•2mo ago
rr808•2mo ago
1718627440•2mo ago