The compute edge belongs to those like Google (TPU) and Amazon/Anthropic (Trainium) building their own accelerators and not paying NVIDIAs 1000% cost markups. Microsoft just announced experimenting with Cerebras wafer scale chips for LLM inference which are also a cost savings.

Microsoft is in process of building optical links between existing datacenters to create meta-clusters, and I'd expect that others like Amazon and Meta may be doing the same.

Of course for Musk this is an irrational ego-driven pursuit, so he can throw as much money at it as he has available, but trying to sell AI when you're paying 10x the competition for FLOPs seems problematic, even you you are capable of building a competitive product.

DeepSeek just showed the compute edge is not that hard to match. They could have chosen to keep the gains proprietary but probably made good money playing the market instead, quants as they are.

https://centreforaileadership.org/resources/deepseeks_narrat...

If you’re using your compute capacity at 1.25% efficiency, you are not going to win because your iteration time is just going to be too long to stay competitive.

> but a compute edge is hard to match.

xAI bought hardware off the open market. Their compute edge could dissappear in a month if Google or Amazon wanted to raise their compute by a whole xAI