Labor and land is expensive, energy is scarce and expensive, and colocation is not that valuable because latency is dominated by compute instead of transmission.
But there must be a good reason I am missing.
I mean, there's a reason Luleå is a popular datacenter spot: access to hydro & wind- but also "free cooling"; datacenters create a lot of heat and having a cold environment makes it easier to maintain ambient temperatures that are sustainable with lower energy consumption.
Additionally, people tend to prefer their servers are in geopolitically stable countries that are less likely to be bombed or undergo civil war (and the US likes to ensure civil war in countries that have a lot of oil) - and you want your datacenters to avoid any environmental hazards like earthquakes.
I can't imagine preferring the equator for datacenters.
However what it does allow all these companies investing to do is fund significant capital expenditure but hide it on their balance sheet. They all know if they funded capex directly it would create a deprecation storm that would tank their future earnings. Instead they give the money to another entity to do the building and magically it’s (the equity) now just an asset on their balance sheet with no deprecation. It’s “worth” a lot as a line item there, but only because the hype driving this financial engineering keeps the shares valuable.
Meanwhile the startup isn’t public and thus the fact that it has this massive deprecation on the books is mostly out of sight and out of mind, with some random sky high valuation that’s not based in any normal sense of business reality.
That all works great… until the bubble busts of course.
"Starting to"? :)
That being said, financial engineering tricks like depreciation and tax sheltering are of course hugely important in the global economy. It's likely that NVDA has a lot of cash sitting in Europe that it doesn't want to repatriate because it would have to pay taxes on it.
structuredPizza•2h ago
maxdo•1h ago
In many cases this 20x+ increase over 3 mo.
This is going in other industries too. Claude cowork is just an example and beginning of the trend.
Show me any product that / company that charge you 20x and customers are happy , well its anthropic
dgan•1h ago
Would I be paying 20€ to ask those questions? I dunno, i dont feel any particular need. Would I be paying 200€?! Are you insane hell no
mdrzn•37m ago
khy34•20m ago
At some point the price will rise. But the value has to have risen for existing buyers to be ok with that - but can they perceive the value? Hmmm difficult to tell. Benchmarks are not an objective way to measure that.
In the long run google is most likely to acquire a serious cost advantage given their level of vertical integration.
surgical_fire•51m ago
I mean, I imagine some top% vibe coding bros paying 200$. I would require some serious evidence that the average developer pays for it.
I certainly wouldn't. It's moderately useful, but not 200$/mo useful.
Foobar8568•33m ago
And I doubt someone can have the cognitive load to follow 10 Claude max. Let alone 1.
bogzz•19m ago