Baker states data quantity is the single most predictive element of AI quality, not algorithms or infrastructure.
“The single most predictive element of knowledge about AI quality is the quantity of data used to train the algorithm.”
Baker argues AI revolution stems from cloud computing power and mobile-generated data, not algorithmic advances.
“The only thing that has enabled the AI revolution that we're living through, which I think we're at the bottom of the first inning in, is one, we had the ability to do cloud computing, so just apply significantly more computational power to old algorithms, and then b, we had dramatically more data.”
Baker explains Intel's historical advantage of reaching semiconductor nodes first gave them 15-20% embedded advantage.
“Intel for the last, I don't know, fifty years, sixty years always got to the next node in semiconductor manufacturing first.”
Baker explains higher MFU allows 25% faster time to market with same GPU and power spending.
“You have the same amount of GPUs and the same amount of power presumably. You could choose between faster time to market.”
Baker says only three US locations can provide gigawatt power to data centers at 10x normal cost.
“There's only basically three places in The United States today where you can get a gigawatt of power to a single data center that's reliable enough, I.”
Baker says only three US locations can provide gigawatt nuclear power, charging 10x average electricity rates.
“There's only basically three places in The United States today where you can get a gigawatt of power to a single data center that's reliable enough, I. E. That's nuclear.”
Baker explains space data centers get six times more solar irradiance than earth-based facilities.
“The sun is 30% more intense and this results in six times more irradiance in outer space than on planet earth. So you're getting a lot of solar energy.”
Baker explains Blackwell racks weigh 3,000 pounds and consume 130 kilowatts, equivalent to 130 American homes.
“The rack goes from weighing round numbers, a thousand pounds to 3,000 pounds. Goes from round numbers, 30 kilowatts, which is 30 American homes to 130 kilowatts, which is 130 American homes.”
Baker details Blackwell transition: racks triple in weight and quadruple in power from 30 to 130 kilowatts.
“Goes from round numbers, 30 kilowatts, which is 30 American homes to 130 kilowatts, which is 130 American homes.”
“And the reason for that is it was by far the most complex product transition we've ever gone through in technology. Going from hopper to Blackwell, first you go from air cooled to liquid cooled.”
Baker explains space offers six times more solar irradiance than Earth due to constant sunlight and intensity.
“You can have the satellite always kind of catching light. The sun is 30% more intense and this results in six times more irradiance”
Baker details Blackwell's complexity: racks tripled in weight and quadrupled in power consumption versus Hopper.
“Going from hopper to Blackwell, first you go from air cooled to liquid cooled. The rack goes from weighing round numbers, a thousand pounds to 3,000 pounds.”
Baker explains space offers six times more solar irradiance than Earth for data centers.
“The sun is 30% more intense and this results in six times more irradiance in outer space than on planet earth.”
Baker states only NVIDIA and Amazon Trainium have functioning switched scale-up networks for inference today.
“And the only two functioning switched scale up networks in the world today are the ones that power NVIDIA GPUs and Amazon's Trainiums.”
Baker emphasizes only 0.1% of the world uses AI models properly yet there's massive shortage despite trillions spent.
“And we're in an insane shortage despite spending cumulatively trillions of dollars. What happens when 5% of the world's population is using these models the way the cutting edge 10 basis points are?”
Baker predicts terrestrial data center buildout will stop within seven years, causing pain for power and cooling companies.
“And the years leading up to that are gonna be very painful for a lot of the companies and the power cooling spaces, you know, these industrial names,”
Baker reveals Atreides could have invested over $50 million in CoreWeave at $1.1 billion valuation but was conflicted out.
“I could've Atreides could've invested over $50,000,000 in the round at 1,100,000,000, And I was conflicted out by Crusoe,”
Baker predicts within seven years we may stop building terrestrial data centers, causing pain for infrastructure companies beforehand.
“But I can't imagine a day when in the next seven years, when we never build another terrestrial data center. Mhmm.”
Baker predicts orbital compute will solve power shortages in five to seven years but wafer shortages will persist longer.
“We're gonna address the watt shortages with orbital compute for sure in the next five to seven years. But the wafer shortage, I think, is going to persist for a long time.”
Baker describes orbital compute as Blackwell-sized racks in space with 500-foot solar wings in sun-synchronous orbit.
“It has these solar wings that are probably 500 feet long on each side. You keep it in a sun synchronous orbit.”
Baker argues America will consume all available compute, reducing edge AI bear case concerns.
“And I just think the same is true of compute. It's why I'm probably less worried about like an edge AI bear case than I was.”
Baker describes orbital compute as Blackwell-sized racks in space with 500-foot solar wings, not giant data centers.
“It's eight feet high. It's four feet deep, three feet wide. It's racks in space and SpaceX has showed you an illustration and it's a rack.”
Baker argues TSMC remains a bottleneck even if orbital data centers solve power shortages.
“But even if we solve the shortage of Watts with orbital data centers, the TSM is still a bottleneck. And semi's and semiconductor manufacturing, you have a big advantage if you were ahead.”
Baker explains breaking memory LTAs could destroy companies by losing allocations when market tightens again.
“Well, if they're breaking their LTAs, it probably means, you know, your oversupply, prices are coming down, and then, you know, capacity naturally contracts. Well, what do you think is gonna happen to Google's allocations?”
Baker cites report that SpaceX plans to bring on eight gigawatts of compute in eighteen months, calling it incredible.
“A Substack writer will fund the AI. They think that SpaceX is gonna try and bring on eight gigawatts of compute over the next eighteen months.”
Baker notes SpaceX brought on over 500 megawatts annually, matching only hyperscalers, CoreWeave, and Crusoe, versus $73B consensus estimate.
“But to this day, the only companies that have brought on more than 500 megawatts of power in a year are the hyperscalers, Coraweave, Crusoe, and SpaceX.”
Baker announces Micron executive Sumit Sadana as speaker and says memory per FLOP drives tokens per watt
“Happy to announce Sumit Sadana EVP and Chief Business Officer of @MicronTech as a confirmed speaker at the @TomorrowXSummit in November. Memory per FLOP drives tokens per watt. Looking forward to hearing Sumit’s thoughts on how AI is changing the business model of memory https://t.co/k1Pdk94PDu”