@SecurityWriter This has been my hypothesis for the last few years, but more on the cloud side.
Cloud’s fundamental problem is that compute requirements scale in human terms, maybe growing by 10-20% a year for a successful business. Compute and storage availability doubles every year or two.
This means that, roughly speaking, the dollar value of the cloud requirements for most companies halves every couple of years. For a lot of medium-sized companies, their entire cloud requirements could be met with a £50 Raspberry Pi, a couple of disks for redundancy, and a reliable Internet connection.
Most of the cloud growth was from bringing in new customers, not from existing customers growing.
Worse, the customers whose requirements do grow are starting to realise that they have such economies of scale that outsourcing doesn’t win them much: Microsoft or Amazon’s economies of scale don’t give them much bigger savings and those savings are eaten by profit.
They really need something where the computer requirement is so big that no one really wants to do it on prem. And something where the requirements grow each year.
AI training is perfect. You want infinite GPUs, for as short a time as possible. You don’t do it continuously (you may fine tune, but that’s less compute intensive), so buying the GPUs would involve having them sit idle most of the time. Renting, even with a significant markup, is cheaper. Especially when you factor in the infrastructure required to make thousands of GPUs usable together. And each model wants to be bigger than the last so needs more compute. Yay!
Coincidentally, the biggest AI boosters are the world’s second and third largest cloud providers.