alt Hacker NewsThis is not priced at inference cost.
My guess: it's the price at which they make more money than if they rent the TPUs to other companies.
The Gemini team has had trouble securing enough TPUs for their user's needs. They struggle with load and their rate limits are really bad. Maybe at a higher price, they have a better chance at getting more TPUs assigned?
The cost at such they could rent out the TPUs, i.e. the market rate, is the inference cost.
Just because you are vertically integrated doesn't mean you get to discount the one business units products to the other. Doing so discounts the opportunity cost you pay and is just bad accounting.