Baker explains nobody predicted old GPU prices would rise vertically, leading to contracted compute trading at massive discounts.
“I don't think anyone in '24 or '25 thought that the prices of old GPUs would be going vertical. Everybody thought, hey. We're gonna be smart.”
Baker argues contracted compute trades at massive discount to spot, repricing will drive acceleration despite potential spot price declines.
“you have the contracted base of installed compute trading at a massive discount to the current spot market, and as those contracts roll off and compute gets repriced higher, spot could decline and compute will still get repriced higher,”