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Comment by unmole | Hacker News Reader

I still don't understand why that means they need to make 5-10 trillion over the next 5 years.

I think the original argument is too limited in its scope. The wider AI market, which is primarily fueled by OpenAI, Anthropic, Google and the large frontier labs (are there any other in the West, except for these 3?) is spending how much... $900bn this year in DC buildouts? After the spent $500bn last year and they're probably planning to spend just as much the next few years if things go remotely their way.

So yeah, I wouldn't be shocked that in the 2023 - 2033 timespan total AI investment worldwide will be around $5tn, maybe even going towards $10tn.

All that money will have to be repaid, and it will have to be repaid 10x, otherwise heads will roll.

The enshittification we've seen so far is nothing compared to what's coming.

OK so let's say build out this year is $900b. Depreciated over, IDK, 6 years (mix of 3 year GPUs and 20 year buildings)? That's $150B a year, but you want the investment to be profitable, so let's call it $250B a year.

That seems... Pretty reasonable? Like Anthropic is at $45B annual revenue, let's say they enter next year with $100B annual revenue? Let's say they have 30% gross margins (no idea), so $70B goes to data center owners/operators. That's one company doing roughly 1/3rd of what's required to pay the investments off. And you have Ant+OAI+GDM+Internal AI at GOOGL/META/etc.+all the servers for open models.

I'm sure there's a world where you can paint a picture that requires $5-10T but that would require capex increasing significantly NEXT year. And the cloud companies won't do that unless revenue keeps growing.

> Let's say they have 30% gross margins (no idea)

There's a ton of speculation that all major labs are losing tons of money, so I that 30% gross margin sounds more like -30% to -130% gross margin.

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