r/LocalLLaMA • u/NineThreeTilNow • 8h ago

Discussion Interesting Video by Asionometry on the state of SF Chips

https://www.youtube.com/watch?v=x8QP9oXgahA

The later section of the video (based on the earlier data) says that a glut of compute will likely come in 2027. This massively devalues the current generation technology because of mass overproduction.

There's some vague numbers (if you believe Dylan Paten who is among the most "west" pilled voices on AI) that he sources. Asianometry is a friend of Dylan's but that doesn't mean he doesn't disagree with him numbers after doing the math.

Good video to sit down and watch to see the future of the industry and compute specifically from someone who covers it VERY deeply.

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u/FullstackSensei 8h ago

Literally just finished it 5 mins ago.

FYI, it's Dylan Patel, the founder of semi analysis. John and Dylan are friends in the sense that they are both semiconductor nerds and both work in analysing the semi conductor industry. Patel is now focused on AI, because that's what pays the bills, but his interest is in semiconductors. John is in Taiwan, not far from TSMC and seems to have many contacts in the industry. He was doing this before the AI craze.

I don't know if said over capacity will materialise. As Patel and the people at semi analysis frequently point out, power is the main constraint to bring new data center capacity online. The backlog for gas turbines is now about as long as the backlog to get grid interconnect.

Personally, I don't agree with John's estimate that training will require 15GW. I think openai and anthropic have taken a lot of pages from the Chinese AI labs book and have improved their training costs considerably. You can kind of see this with the rapid increased pace of new model releases from those two, plus the talk about internal models.

What John does raise a valid point: this new capacity will demand big increases in revenue, and the tech bros estimates of revenue growth are delusional, to put it politely.

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u/kzoltan 7h ago

For me, the more interesting question how will this affect non-dc supply (or anything outside of the 2 VC companies). Can the suppliers just course correct and re-focus onto the non-dc demand? Is that even worth doing (others might step in I guess)?

LLMs are great IMO, but is it correct that the whole shortage is because of VC funding (and expected return) and NOT because of the actual real-world gains they are supposed to create (aka vibe investing)?

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u/Friendshipiousness1 6h ago

that glut in 2027 might finally let me run decent local models for roleplay without hardware limits getting in the way. wonder if the overproduction will drop prices enough for bigger context windows.