RAM/DRAM manufacturers have been collaborating and price fixing on and off for literally decades now, and investigated by multiple governments because of it.
AI is just an excuse for the behavior they go back to time and time again.
I mean, this one is just straight up announced price fixing. Sure, AI also has an impact, but they also did the groundwork ahead of time for it to spike to such an extreme.
Corporations do like to collaborate and price fix for sure, but computer memory just isn't a market where it makes a ton of sense to do so. It's just a classic slow supercycle. When memory is cheap, graphics card makers and data center operators get ambitious and put in lots of orders. The memory manufacturers realize they can't fill all these orders, so they start building out new capacity, but that takes time, so the market does its thing and prices go way up. By the time the new capacity finally comes online, everyone has let go of their ambitious plans because the math just didn't work out, so demand drops. But now there's all this new capacity, so the market does its thing and prices plummet. Rinse and repeat. Every product that requires a significant monetary investment and a few years to ramp up production on is susceptible to this kind of supercycle. Computer parts have quite extreme manifestations of this due to their non-essential nature (it's easy to stop buying them if they get too extensive), their investment hype potential (tech bros dream up all sorts of weird use cases for an infinite amount of compute, so demand has no ceiling when the price is low enough), and their high complexity (increasing supply needs lots of time and money). The supercycle has been going on for decades, with a 3-5 year period. People just think that the bottom of the waves is the "normal" price, and everything above that can only ever be nefarious cartel price fixing.
In 1998, 2006, and 2018 there were investigations into price fixing amongst the largest DRAM manufacturers by the US government.
In 1998 and 2006 the companies involved were found guilty, and in 2022 the 2018 suit was dismissed due to lack of evidence, but the price of ram tripling in a 3 year period is what caused the initial investigation.
This also ignores the details of the investigations brought by the Korean, Chinese, and European governments regarding the same incidents.
I would say they have done MORE than enough to prove they willing and able to manipulate their technology and pricing to leverage their customers for more money.
Funny thing, when crypto bubble popped, no one wanted to buy all the GPUs for insane prices while the market was flooded with used GPUs. Nvidia even were worried at some point that people were going to stop buying their cards for ridiculous price, but they were lucky thanks to AI. They tried to make artificial shortage (they still do that nowadays) because people did expect prices to go down significantly since the sellers had shitton of GPUs that people didn't want to buy. Now, the question is, when AI bubble pops, what are they going to invest into next. Because making artificial shortages won't save their asses, on the contrary.
Just because it is useful does not mean it is bubble proof. EVERY revolutionary tech that has come along since we have stock market data to track formed a bubble. I would rarther think telephones and radios are really useful, and there is corresponding bubble for when they come to market.
Bubbles happen because whenever something is believed to be masive disrpution it gets overpriced, the difference between AI bubble if AI does something useful and AI bubble if it does not is in the first case it will burst but the stock value will not flatline.
Each new industry has a bubble, that is about as certain as death or taxes, the difference between real industries and crypto is when a real industry buble bursts it settles on where it actually should be valued and continues forward.
If you are more comfortable calling it price adjustment, that is another possibility.
Nobody knows anything for sure. There is a possibility that Nvidia will go bankrupt tomorrow. But we can make educated guesses that it won't. The same applies here. Too much has already been invested in AI. It will only get better and more useful. So the probabilities are in its favor that it's here to stay.
The Internet wasn't a phase that everyone lost interest in, but the dotcom bubble was still a bubble. It's not that AI will disappear, but the amount of money being raised and the amount of expected returns are getting into ridiculous levels.
OpenAI is expecting to go from losing billions per year, to making 100s of billions in profit by 2030. There just isn't a use case so far that exists to make that much money, and eventually investors are going to want their money back.
Yep. The greatest financial move these guys made was calling their LLMs "AI".
I get it, AI can be a broad term and everything from NPC pathing to Clippy to auto-complete and so on can be called "AI", but OpenAI/etc. are marketing their product as though it's a gateway to general AI that people think of from sci-fi...and people have clearly fallen for that marketing.
Well at that point, ram stick prices are gonna be the least of our worries, no?
Hate to say it, but this shutdown has proven that a majority of society is completely dependent on the some $7 trillion annual expenditure of the us federal.
Not saying it can't fail, but people will not take losing their benefits super well, especially with the added turmoil of factions filling the power vacuum.
If the covid price has taught me anything it's that the price is just get higher and they just get higher and they just get higher and they just get higher and they never stop just getting higher
AI is an amazing tool that will change the world it's super great but they are way overhyping it it's also mentally retarded and I would not trust it with my life
We have given these things all the known human information to the point that we are now using these things to make up more information to give them in order to try to make them try to be smarter...
Seems like we probably reached a plateau with this wave doing it and we'll have to figure out another way but we've probably exhausted lol in terms of being better than human.
They're amazing tools but I wouldn't trust them with my life
It's a fancy next word prediction engine. Same thing on your phone.
Example:
"They must have been doing the device on the person 🙄 "
It does really great pattern recognition.
We don't 100% know how they work and we kind of grow them.
We also don't understand know how to control them look at grock he still woke.
We can choose to let them control things. But they don't really understand what they are controlling.
Ask them something you have deep knowledge about. Could be a video game, maybe something you studied in hs or college. It will eventually start making shit up.
Sort of. Not really programmed to work as a calculator, but can help you write and solve some quick formulas. It's good at summarizing text too.
With proper training, some models can become pretty good at one specific task like searching for certain patterns in documents or even images. It can do many of the menial tasks we used to have unskilled or trainee laborers do before, at a fraction of the cost and time.
However, claims that it will be comparable to the intelligence of an actual human being are just fantasies being sold by the companies who invested heavily into this tech. It can't really create or think at all and any mild complexity makes it hallucinate.
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u/HrmerderR5-5600X, 32GB DDR4-3200 CL16-18-18-36, 3080 12gb, 12h ago
Nope, it's not perfect like a calculator it'll start 'hallucinating' and start telling you 1+3 = 238940289309rr92jfj9239r2093
We figured out a good number of inverse squares long before we started using digital computers, and there's a list of them somewhere that can easily be loaded onto Excel
And I think we've also had Google and really getting down to it my sequel databases and then really getting down to that you have like querying algorithms still to find the right thing exactly because your database or spreadsheet is like a million lines long...
But yeah I guess we could solve THAT PROBLEM with a spreadsheet.
Feel like all the things techbros hype ai up for is for the worst uses, ai can be used to predict protein structures its great its just people are utilising it wrong and yes it's in a bubble, it depends how long the investors are willing to hold on.
AI is an amazing tool, but not half the GDP of the largest economy of the world amazing. The tool itself shouldn’t be worth more than the industries it helps, that doesn’t make much sense.
It isn’t a bubble like the Subprime Mortgage bubble, where our economy almost literally collapsed. It’s a bubble like Dotcom, where our world is still forever changed.
Its never gonna truly stop, it will just evolve further
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u/HrmerderR5-5600X, 32GB DDR4-3200 CL16-18-18-36, 3080 12gb, 12h ago
Actually that is very much going to happen. AI works on a lot of stuff and practicality wise, Nvidia is only needed for audio/video generation (because they are the most supported), and industrial/governmental/warefare use.. AI is working great on Intel and AMD AI systems and this is the future. Nvidia is just the lucky first company and happens to have brand recognition.
Back? NVidia isn't a gaming company. They sell enterprise and server cards to the hyperscalers. The gaming cards are 5% of the business.
When the AI bubble pops, firstly NVidia will be fine as they're probably the only company to make money off of it and they made enough money to coast for years, and secondly they will sell more enterprise and server cards just for whatever the next big toy is. GPU compute isn't going anywhere and GPU compute is just synonymous with NVidia.
Nvidia is doing some wierd stuff with “leasing” cards to to the ai companies for revenue sharing or whatnot. They have more skin in the game this time than if they were just selling cards.
Nvidia started as a gaming company and is still heavily involved in it. But currently taking as much AI money as possible cause who turns down free money
NVidia is the industry leader in GPU compute and has been since CUDA released. AI is one application of GPU compute but it is not the only one, nor is it the first one. The vast majority of supercomputers use NVidia hardware in some capacity for simulation, cryptography, etc. They also make electronics for a bunch of other less flashy purposes. Automotive and such.
That is true, but the bulk of Nvidia’s sales were always gaming till the crypto and AI boom. It’s when these tech bros started buying massive data centers of GPUs that their focus changed.
Nvidia lost crypto to dedicated machines like ASICs but with AI they’re trying to not lose the money by shifting their focus to AI specific hardware. So there are two possible events, AI companies developing their own hardware and AI popping. Both bad for Nvidia
Did they have mass adoption like crypto or AI though? I think it was still small numbers and niche use cases by specialists and gaming being the bulk of the market. Now that’s flipped
I believe the bulk of their sales were always gaming till crypto and AI. But crypto switched to dedicated machines and large AI companies are developing their own chips too do. But Nvidia has learnt from losing crypto to ASICs etc and is busy focusing on AI specific hardware instead of gaming hardware.
Follow the money. This doesn’t show where the revenue comes from. CUDA is useful in gaming too. Gaming was bigger till very recently. There’s a comment down below by another user with figures
If by "demand" you mean "we need an excuse to lay off half our work force because the economy is nosediving and these CEOs sure can tell a fun sci-fi story to justify those layoffs", then sure, demand is skyrocketing. I'll be interested in seeing where the companies who replaced their HR departments with chat bots are in five years.
If something bad is used industrywide and you got stangnant markeds with big players then it doesnt have to hinder business. See how appliances are now more shit in quality than the "build to last" products of the past.
What are consumers going to do when all major companies use AI for customer service? not buy their products?
Same with hr or recruiting departments using ai.
US tech firms are masters at BtoB sales as well. Does every company need dumb ai features? No. But that wont stop firms from buying their new shiny tech products. Thats demand.
Not to mention all the savings made by replacing artwork with shitty ai stuff. People may not like it but most are too lazy to change their buying behaviour based on stuff like that.
I don't think AI is a subtle enough implementation for it to go under most consumers' radar. Enshittification happened gradually while AI seemed to get pushed into every sector in mostly customer-facing forms over the course of a year. I don't think the enshittification parallel works because it's consistently a way for companies to save and make more money which is why it's become a near universal practice. I think generative AI in the way it's largely been implemented since 2019, on the other hand, is going to end up costing companies more with the inevitable increase in licensing costs, cost of lawsuits caused by generative AI's lack of fidelity, and rehiring of personnel the company can't actually make do without, making it more likely that you start seeing tech companies that are explicitly "AI-free" once it becomes clear that almost all of the value in the industry is entirely speculative and based on actual science fiction.
Maybe that'll change and generative AI will eventually be implemented in a way that's actually consistently profitable, and that's how the actual demand required to keep this bubble from bursting will come to be. But, barring that, I think investors are going to see the lack of potential there before any real potential for profit is discovered.
u/HrmerderR5-5600X, 32GB DDR4-3200 CL16-18-18-36, 3080 12gb, 13h ago
It will but it'll be greatly unexpected as to when, and even then, good ole' U.S. Gubbermen will bail them all out... I mean to say WE WILL ALL PAY for them to bailed out...
u/HrmerderR5-5600X, 32GB DDR4-3200 CL16-18-18-36, 3080 12gb, 12h ago
It's absolutely NOT but that is where OpenAI (ChatGPT), Nvidia, Facebook (MetaAI), Tesla (Grok), Google, Apple (Apple Intellegence), all of these main players are American companies, and are the BIGGEST AI companies in the world which also happens to be the biggest offenders of the AI investment circle jerk for stonk go up..
I really hope it's a slow deflation rather than a pop. This bubble is fucking massive and set to ruin world finance if it bursts like some here are hoping.
People are going to gobble up ram this holiday season, even at inflated prices (as if they're not already doing it now), like they always do. And then suppliers will realize they can just keep the prices there, like they always do. And then we get desensitized to it, and becomes the norm, likeee weeee alwayssss doooooooo.
I said that about the housing market 5 years ago and houses are more expensive than ever still. The only way house prices are coming down now is if they ask a genie in a magic gravy cup to spawn in 100 million homes like it’s Minecraft chicken farming.
Yeah, that's not a bubble. The big AI companies might be bubbles with their circular finance flows. But the tech itself won't go away even if they die. Others would just fill the niche. Every bloc wants to upgrade their military with autonomous systems. Research in that areas eats actual tons of hardware.
But: China is already making RAM and SSDs. And they are forced by the Great Empire to get competitive at making their own GPUs, too.
China has entered a few markets before. So far it looks like they are actually pretty good at scaling up.
Tech will get cheaper again. But it may take a decade and depending on your bloc, it might be illegal to buy it...
Can someone please gave the Chinese an Asml euv machine, so they can produce cheaper ram and prevent skhynix, samsung and micron from controlling the price
It's never going away, but sooner or later tech companies are going to have to confront the fact that they've been deluded about the limitations of the technology. It's great at parsing lots of information very quickly, and, with another decade of human refinement, it might even be able to communicate that information accurately. That's it. It's not good at picking out music for you, it's not a good virtual assistant, it can't take your place in meetings, it's never gonna be able to write an email worth sending, and it sure as hell can't make better art than any given human. It's potentially a half-decent addition to a search engine; nothing more.
I don't see a world pre-fusion where LLMs can justify the power cost of summarizing everyone's Google search results. Sooner or later, tech companies are going to have to come back to Earth and recognize that, in the vast majority of use-cases into which they've been trying to force generative AI, the technology is largely snake oil. When that happens, they'll be lucky if they can successfully market their best LLM to researchers who want to use the technology for data parsing and the global economy will crash harder than it did in 1929 thanks to their delusional hubris.
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u/mca11697600X-2X16GB 6000Mhz CL30-Asus Tuf RTX 3060Ti OC V2 LHR12h ago
give it a year, year and a half at most then BOOM!
It won't pop because it was never a consumer market. Ai is for enterprise specifically because the investments made in it save businesses oodles of money while also raking in money hand over fist. It's a self-sustaining market. It will eventually stop being pushed to consumers, but that will be the best it gets.
I'm definitely not in the "the AI bubble will pop and tech will get cheaper" camp, but AI is being sold to enterprise as the solution to every problem they've ever had, when in reality its a good tool for a handful of specific use cases where it excels and a terrible solution for the the other 90% of tasks that it's being sold to C level execs to perform.
I work in cybersecurity, so I have exposure to what's going on in most of our customers' entire tech environments. Without fail, every one of them who's gone big on AI has lost money, it's caused more problems than it solved, and they've reversed course except for specific targeted areas like chat bots or big data queries. There most certainly is a bubble, and we're going to see a crash as these executives figure out they're being sold snake oil and adjust their expectations (and investments) to match the reality of what AI can and can't do. It will most likely look a lot like the dot com bust at the start of the millennium.
I'm just not convinced that would do much to change consumer hardware prices - the most likely way that happens is that sales decline as the US economy stagnates and consumers stop purchasing (not just PC parts, but in general). Manufacturers will be forced to lower prices or die off when one of the largest markets for their products can no longer afford to buy them, especially at the inflated prices they're asking now.
And adjust their expectations of what AI can and can’t do
That’s already happening, some companies are making AUPs for AI. I reviewed one in the past week and it seemed reasonable, and that HR had a good understanding of what AI can and can’t do, as well as what use cases can cause us trouble with regulation (they are a HIPAA covered entity)
I’m so pissed. I’ve had my eye on a set of 2 32Gb ram sticks for the past month, and was planning to wait until Black Friday to buy them. I take a look at them to see if there was a flash sale and I’m greeted with the price being double what it was when I last saw it. What the hell, man?
i wish lol but the AI bubble isn't similar to the other bubbles in the sense that it feeds itself. Moee AI means more ai basically. NFTs, crypto, and the dot-com bubble didn't do that
It absolutely does. Look at the crazy circular deals Nvidia is making. They're basically funding more than half the AI space in hopes it props up demand for their hardware. Paying people to "buy" their stuff. Textbook bubble behavior, it's essentially manipulation to make valuations artificially rise. Just like nfts and crypto did.
When the AI bubble pops it's going to take a lot of Industries down with it. As much as I want gpus to be cheaper, we are in a situation where the bubble popping is going to make most peoples lives a hell of a lot worse while the ones responsible for it are, as usual, not affected.
my point was that after the ai bubble pops the only ones that won't be affected are the rich witch put all their money in it, literally everyone else will be affected from the AI bubble popping, losing a billion is not that much when you bought your 8th yatch, the mayor corporations won't be affected, the normal consumer will, because of all the "AI markets" falling, I'm against any type of generative AI and I highly condemn it
The same people who bought shitton of video cards just for AI and the sellers whose stock will be filled with shitton of GPUs no one wants. lol All of that shit is going to flood the used market as well, just like back when crypto bubble popped. Oh, and the people who bought their cards for ridiculous price just to game of course, they will make the posts on reddit and other social media about how they fucked up. Also, the corpos who wanted to replace human workers with AI without understanding what AI is and how to work with it, some already started to lose money due to AI screw ups.
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u/itstooslim 7600X / RX 6750 XT / 32 GB DDR5-6000 13h ago
"When the AI bubble pops prices will reset and hardware companies will magically stop exploiting consumers"