Dylan Patel: evaluation

Transcript context

…The key question I really want to understand is: if the current trend continues, it’d be north of 50 gigawatts per lab by the end of 2028. So between them they’d have 100 gigawatts. Those gigawatts, as you’re saying, drive many-fold more throughput or performance by 2028 than they do now, because the hardware’s gotten better. Not only have flops per watt increased, but also the hardware gets better at working with AI workloads. Okay, so 100 gigawatts for the labs by the end of 2028. How much is world compute? I think that may be a little difficult, given that by 2028 they’ve taken 70-80% of incremental compute. And I’m not sure what happens to markets then. How much does the price of compute skyrocket for them to actually be able to buy 70-80% of compute? Is Google or Meta or Amazon willing to sell even that much? Also, there’s one caveat when we’re talking about these gigawatt numbers. When Amazon is serving Bedrock Anthropic models, that counts as Anthropic compute in our worldview, because it is effectively, at the end of the day, counted as revenue for Anthropic even though there’s a revenue share and credit back all that. But ultimately in 2028, if they get to 100 gigawatts combined, they have done really disruptive things to the market. Because anyone can make money off of $10-15 million per megawatt compute today. I kid you not, it’s not that hard. Go get a GB300 rack, go download the Kimi weights, go download vLLM or SGLang, set it up. Codex and Fable can actually help you do this. It’s pretty simple. It’s not trivial, but it’s not rocket science. Go put it on OpenRouter. It’s very simple. You’ll start generating more revenue than you’re paying for the compute. This has already led to this compute pricing, $10-15 million per megawatt, starting to inflect up. To get to that 100 gigawatts in 2028, you have to believe that the labs can outpay for compute, because anyone can make money at $10 to $15. Does compute now get to $25 million a megawatt? Does it get to $40 million a megawatt? As you’re saying, it’s already the case that the labs are generating way more revenue per megawatt than everybody else. If they stay as far ahead as they are currently, you would expect that to continue being the case. If there’s some kind of recursive self-improvement where the AI labs are relatively uplifted — or they have models internally they’re not releasing externally that are helping them make their next model better — you’d expect that to be even more the case. Aren’t you already seeing this, where SpaceX, or whoever is slightly further behind, will just sell compute to the highest bidder if they can’t internally monetize it as well as the labs? You’d expect them to keep bidding for larger and larger shares of the compute market.…

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