Maybe you didn't read the articles - the costs we are talking about are mostly hardware.
Yes. Actually the Bain article isn't about AI-developping companies but datacenters investment.
The article (at least the Bain & Co report) isn't about AI technology spending but the conundrum faced by datacenter investors. It doesn't identify shortage of investment as a risk to AI: while it does mention a shortfall of 800 billions between the 1.2 trillion in increased revenue by 2030 and the 2 trillions expected, the outcome of a lack of investment wouldn't be, according the the report, a failure from AI-developping companies, but a failure for supply of compute power to meet the demand coming from AI-using companies (which the report assumes will be there to create demand in 2030). The risk identified in the report are :
- insufficent investment to meet the demand,
- increase in algorithm efficiency (so the compute demand can be met with fewer datacenters, potentially leaving datacenter owners with infrastructure supplying unneeded compute to the market),
- unpredictable technological breakthrough changing the landscape,
- Supply-chain shortage (you can't build datacenter in the US if you have tariffs on electronics, or if the electrical grid collapse)
Basically, I thing Frogreaver read the article and expressed optimism toward point (2) and (3) of the Bain report, moreso than Bain (who expects the next breakthrough in AI-optimized chips to occur later than in the 2025-2030 timeframe they analyze. If he hadn't read the article, he would have to be incredibly lucky to mention two core points of the report's analysis by chance!
So, your solution to how expensive hardware is is to... replace all the hardware yet again? When the new hardware will undoubtedly be more expensive than the old hardware to purchase?
That's exactly what the report explains is happening. The investment shortfall is because compute powers gets outdated fast, that's why you need large returns on capital expenditure to keep the profitability of Amazon, Microsoft, Oracle, Google... at their current level.
Plus, when they are spending hundreds of billions... soon approaching trillions... more than they are bringing in, it isn't clear that they can hold on until the next generations of hardware make operations affordable.
The report warns about the "risk" of not having enough compute for AI, not AI companies collapsing leaving excess unused datacenters lying around. When it barely alludes to it (page 34 of the report), it states "However, without such innovations and breakthroughs, general progress could slow, and the field could be left with only those players in the market with adequate public funding". The part of the report explaining the market fragmention linked to sovereign AI demand develops on that: 200 bn€ from the EU, Chinese initiative to build public computing infrastructure (and lending it to Chinese AI players without concern for rentability) may be the deciding element as private investment lags where there isn't enough public support.
