What Is the Oxide Switch? FAQ Friday #65

Ben Horowitz reveals Amazon CEO Andy Jassy told him its AI compute is sold out beyond 2028, and says that shortage makes this fundamentally different from the dot-com bubble “This shortage is so bad. You know, I was speaking with Andy Jassy, who runs Amazon, yesterday. And I said, yeah, like, we’re out of everything, you know, till 2028. He’s like, oh, it’s beyond 2028. Like, I don’t think we get stuff back, like, end of 2028, maybe. So everything else is sold out.” “So he has the advantage of that, he’s got supply in a great shortage, which is extremely different than the internet bubble. The internet bubble, we didn’t have enough demand, because we had to build the internet, people had to get broadband, you know, you needed all this stuff people had to buy, you know, originally, they had to get their browser at price, all this kind of thing.” “There weren’t enough consumers on the internet to absorb all the bandwidth that had gotten built out. And they had a massive amount of debt, not unlike we’re building today, although not as big. But the lack of demand killed it. We don’t really have a lack of demand in AI. So I think the dynamics will be different.” “I do think, like, for sure, if you get into a pathological debt situation, that can wreck anybody. It’s why, by the way, we’re not invested in any of these neo-clouds either, for that reason.”