Sacks identifies GPU oversupply as the primary AI infrastructure risk, comparing it to dark fiber after the dotcom crash, particularly if compute was built expecting $30-50 per watt pricing.
“The biggest risk, to me, is not on the demand side, the biggest risk is that you get a glut of compute and you get an overbuild. And, in the same way we had dark fiber after the dotcom crash, if you have dark GPUs that would be a disaster for everyone, especially if you built out your compute infrastructure expecting a spot price of $30-$50/watt, as, you know, Elon said they were expecting, right.”
Sacks warns that overbuilding computing infrastructure could create unused GPU capacity similar to the dark fiber problem after the dot-com crash.
“The biggest risk is that you get a glut of compute and you get an overbuild. And in the same way that we had dark fiber after the dotcom crash, if you had dark GPUs, that'd be a disaster for everyone.”