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The demand is vast but at what cost? I don’t think we found the equilibrium market clearing price for compute.
The subsidy is massive thus it’s distorting the market.
What do you mean by subsidy? You mean cheap underpriced capital?
The token cost per kWh. Plus the overall lifecycle cost of compute. End users are not picking up the tab yet
Ah, I'd argue that's a symptom of cheap capital. Investors are willing to let the companies operate at losses on vague promises of future rewards
I don’t think the frontier models are profitable yet.
Yet trillions of tokens are being processed daily.
At what economy of scale does this become profitable?
it doesn't need to be if the government can print money and bail you out.
Ok, but energy prices are also artificially high because of all the stifled development.
Nice to see people who do real work being compensated well for it.
This could go on for a long time though. The demand for compute is vast, which will lead to developing a bunch more energy projects and other natural resource projects to make it more abundant. That will lead to growth in nearby communities, which will require more construction.