Sam Altman:
A lot of people want local inference, and somehow they assume that the problem is solved now because we have open-source models, we’re going to be able to run them on our computers, and so we’re not going to need all the stuff in the data center.
But from a global allocation perspective, actually it’s quite terrible to have everybody, like, have a bunch of the world’s limited supply of DRAM sitting in their own computer and being used five percent of the time.
Like you want maximum utilisation in the cloud if you’re trying to deal with this very supply-constrained environment,
And somehow many people’s intuition is the opposite of that
TL;DR Guy selling product: “Here’s why owning your own product instead of renting it from me is a terrible idea”
Finally coming out of the bloody closet. Frontier labs and Nvidia are in death dance.
The latter sells mostly to the former, but their growth story needs local inference to keep up with valuation. Nvidia could reduce prices on a whim and boost local inference, but that would make its investment in frontier labs lose too much.
Frontier labs meanwhile need public markets money, and their story really needs local inference to be more expensive/extremely worst than what they offer.
One narrative takes money away from.one side and puts it in the pockets of the other.