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Cerebras does the exact same thing, disabling the bad tiny cores on their wafer-scale and routing around them in their compute network. The question is how much extra capacity do they have to plan for, and does the cost of that still make sense, with the yield they can get.

Cerebras pretty much has to be at the end of what can fit on a single wafer. Larger wafers would require retooling one of the most up-front-expensive industries, and denser is not arriving fast enough. I expect their scale-out story to rhyme with NVidia et al working at rack scale and beyond, just denser. A rack of Cerebras has 400 G networking for two wafers today.

Well they still just do the same thing GPUs do where bad clusters are disabled. There's going to be a balance there for how big the clusters are and how many tiers they'll offer, but that's a known problem which can be well modeled.

Love the idea of discounts based on model error. ”this one doesn’t know what butterflies are, it’s on sale for 8% off”

Yes, "this one is obsessed with the golden gate bridge" will be for real this time.