alt Hacker News> Companies buying those machines need years to get their money back. If they didn't believe they would make a good ROI they wouldn't buy as much.
In the late-1990s companies were building out fibre optic networks, as they believed they would get a lot of ROI from all the Information Superhighway demand. The expected demand never came in the expected timeline.
Of course demand eventually used up all the dark fibre over the course of many moons, just not quickly enough to save many companies:
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The demand for AI exists today.
As in OpenAI is at capacity, 6.1 Sol is served at 30 tokens per second and with frequent capacity errors.
Anthropic seems better now but were also working hard on expanding capacity.
I have no crystal ball to see how future demand and capacity will develop, but as of today these data center investments appear to be fully utilized.
Some people anyway seem to think a collapse is inevitable.
More specifically, the demand for fiber didn't come - but the demand for bandwidth did!
Those companies were building out fiber like it was a legacy telephone network: needing a massive amount of individual wire pairs to carry a massive amount of parallel transmissions. In reality the bandwidth per channel was rapidly increasing due to better tx/rx equipment, and with the rise of WDM it was suddenly possible to carry not one channel per fiber pair but several dozen.
When you were laying fiber on the assumption that a single long-distance pair was going to carry 1Gbps - and therefore laying hundreds of fiber pairs in a trench at once - it is quite a big upheaval when that single pair can now carry 100 channels of 10Gbps each. Your brand-new expensive fiber trunk can suddenly be replaced by a single spare pair some utility company had lying around already.
Turns out laying fiber isn't a great business when the capacity of existing fiber is doubling every year or so!