The problem is that when a vendor finances their customers, they can create the illusion of 'real' demand for their product, when most of the the end-users are only actually using something because it's cheap. When the vendor runs low on cash and starts requiring payment, the customer may not be able to afford it, taking both vendor and customer down, and leaving the end-users who have a real need, and were willing to pay sustainable prices without any options.
that makes sense to me in a conceptual sense
however inference is very profitable and plummeting in cost for a given point on the intelligence curve, and nvidia gpus can serve different models so they are protected post-buildout
> however inference is very profitable
Is it? OpenAI and Anthropic are burning cash faster than anyone has ever shoveled cash into a furnace.
This was true about 18 months ago. It is no longer true.
You are describing the justification that NVDA is using to explain their behavior; they see it as something of a 'bridge-loan' until the LLM business model reaches steady-state. The problem is that this explanation has been used for many bubbles, where companies mis-categorize ongoing costs as one-time expenses.
> however inference is very profitable
Is there any actual evidence of that?