More and more mainstream analysts are identifying the coming AI crash, which is a good indication that it will happen soon.

So, what happens to all the data centers? They are already built but probably very expensive to maintain. Will many of them just be abandoned? Bought up by cloud computing companies? Scammers? Crypto miners? Can they be parted out and sold off piecemeal?

Will they be put to some productive use, or just become massive e-waste sites left to the locals to deal with?

  • GamingChairModel
    1·
    2 hours ago

    Yes. But major differences:

    The dot com buildout of physical communications infrastructure involved basically 3 things:

    1. Switches/routers at the nodes for sending signals down the right route.
    2. Fiber optic cables connecting the nodes.
    3. Legal rights of way and easements for the legal right to keep the physical assets in that physical place, and to maintain/replace the stuff as needed.

    Category number 1? That stuff went obsolete quickly, and wasn’t really reused after the crash.

    Category number 2 was better. Turns out, fiber optics can carry signals on a lot more channels than those fibers were originally designed for. And they’re designed for useful lives measured in decades. So even if they sat dark from being unused for 5-10 years, eventually they could be used again.

    Category 3 is super important. That legal right is basically permanent, and so long as communications equipment needs to physically go from one place to another, having that legal right can be built on and profited on (including the ability to sell or lease those rights).

    What’s that gonna look like for the AI infrastructure? The servers full of GPUs are the bulk of the cost, and the GPUs are replaced with a new generation every 1-2 years, seem to require all new power and cooling infrastructure every 1-2 generations or so.

    Plus the AI buildout looks to be several trillion dollars. Even adjusting for inflation, that’s so much more than the tens of billions that each telecom company built out that infrastructure.

    And it’s hard to see how the servers themselves will be useful for regular businesses, much less consumers. A Blackwell 72-GPU server is $3 million and takes 130 kW to run. A residential electrical line maxes out at about 48kW. The newest Vera Rubin servers are projected to be up to 600kW, with all the power and cooling management that comes with that, plus all the ultra high end networking stuff built into that rack. Even deep pocketed businesses will have trouble finding a use for that server rack worth millions, requiring a ton of supporting infrastructure that not even normal pre-2025 data centers have.