Join the discussion
Write your take first — we'll ask for email only when you're ready to publish.
- Hacker News
- What would happen to Nvidia, Anthropic, OpenAI, if tomorrow someone released an open weights model on HuggingFace that matched performance and accuracy of Opus 5 running locally on an RTX 5070? That won’t happen tomorrow, but it will likely happen someday… what’s the plan beyond “don’t be the one holding the bags?”by gymbeaux
- If you could run Opus 5 on a 5070 then the labs must have achieved RSI at that pointby lisplist
- It seems very very unlikely that an Opus 5 matching local model that runs on a 5070 will be released within the next 5 years (I don't want to say "ever").
If it does happen then NVidia will sell a lot of 5070s though!
by nl - "eventually" is actually a function of frontier model capabilities. You only get Qwen6-27B when you have Opus 7 producing extremely high quality tokens for them to train on. So the market for local models is always significantly behind the frontier, by definition.by JacobAsmuth
- Workloads will inflate just as they have been. Remember when llm assisted development used to be good only for a function, then a whole file, then a handful of files, then a code base, then a full stack, etc etc etc.
People will claim to have “enough” even though they already have the equivalent of last years capabilities locally.
by jkahrs595 - Nothing would really change IMO? 99% of users don't have anything like a RTX5070 (mobile especially).
Even if it did, it still doesn't make much economic sense running a model locally vs on a datacentre.
For example, I managed to just about squeeze a Q2 quant of Qwen 3.7 27b on my 9070XT. I get around 60tps decode (slightly faster prefill). _but_ it uses 300W of power to do so. At UK electricity rates of 30c/kWh this works out at something like 42c/MTok. I can get far far better models on openrouter cheaper than that, plus I'm not horrendously constrained on context length.
by martinald - Those companies will be quick to copy the tech, inference cost would plummet and there is a greater chance that these companies could make it to solvency. At least in the short term. Long term it might not be so great as consume hardware catches up.by ColdStream
- There’s no reason to assume frontier-level intelligence eventually collapses all the way onto a midrange consumer GPU. In fact, there are quite a few reasons not to assume that (information-theoretic constraints, etc).by jimbo808
- If I could have shown up somewhere in 2022 with a Mac Studio M1 Max w/ 64GB of RAM running Qwen-3.6-27B or 35B-A3B, I would have pretty much been a demigod - to a degree far more impressive than being able to run Opus 5 locally today.
So yes, I think your scenario is likely to eventually happen, but there will be a much more powerful, capable frontier model then.
by trollbridge - The Möbius strip of AI financing continues…by Noaidi
- it seems much more like Relativity by M. C. Escher where no one is quite sure how to exit without bringing everything down with them?by sidewndr46
- In other words: the investments that were never going to happen are not going to happen.by behnamoh
- While it is true they haven't lost anything, it does signal to shareholders, potential share holders and current VC's the direction of things.by ColdStream
- Ed Zitron might be rightby chocolol
- Ed Zitron has not yet made a single correct prediction about AI :)by JacobAsmuth
- I think he is wrong on the overall usefulness of AI but I have yet to see someone actually refuting his economic arguments.by xdertz
- His numbers might be off or he might not have all of them.
But still I can not escape that he is most likely correct. All of this equipment needs to be paid. With interest and profit. With the usual overheads that the companies run. And if more is being bought each year. It doesn't seem like one and done deal. And then just asking where will all that money come from is very good one. And one we should be very honest about.
by Ekaros - The numbers have become so large that normal corporate risk management starts looking quaintby KurSix
- This is probably a lot more related to the fact they want to make GPUs an asset class. Nvidia is banking on the fact there will be an entire market that will guarantee whatever anyone needs.
- A rapidly depreciating asset class of something that loses almost all its value in a few years and can't be repaired?by trollbridge
- This is meaningless in the long run; the broader problem is the constant circular financing and "Fake profits".
It is not the first time, either; the capital cycle will prevail.
by Taikhoom10 - All economics is circular financing, that's how it works.
You pay Apple for a MacBook, Apple uses it to develop a better MacBook.
What goes wrong is leverage. We haven't seen much hint of the 10x leverage kind of deals that brought down the house in 2008.
by fooker - I would like to see the numbers.
If Nvidia sells hardware for $100B with 75% cross margin, and provides $50 billion in backstop for that same hardware, it would be still be nicely profitable deal ($25B) if the backstop capacity would be a total write-off recovering $0. Reselling that capacity in some large discount below already low backstop price would increase the profits.
It's all those pension funds, sovereign wealth funds and Softbank getting into that $500 billion deal that will be hurt.
by u1hcw9nx - Businesses aim to make the most profit possible with their resources. If they can make a 25% margin that is good, but if they can turn around sell thr same thing for a 50% margin, that is much better.
Basically what i am saying is maybe there is a better buyer than openai.
by NewJazz - Pretty much, I have said it for a while now, Softbank and Oracle are the ones I would be worried about. Both of them have put their companies wealth behind this, if it goes down so will they.
Others have played it fairly smart in terms of insulating potential issues.
by ColdStream - Nvidia is turning into a savings and loan company that happens to design computer chips on the side. What could possibly go wrong.by cmiles8
- Wait until you hear about how airlines work, you'll start babbling about the rewards-points bubbleby JacobAsmuth
- The loans will just take longer to repay. There is a market for Anthropic & OpenAI, it just likely doesn't have the 200B profit each year required for the maths to make sense.
If shit hits the fan, the companies collapse, then Nvidia gets their money from the investors anyways.
by HDBaseT - Soon the GPUs will just be the promotional gift you get for opening a sufficiently large Nvidia financing accountby KurSix
- As it's said... "Every company eventually becomes a bank."by insaneirish