Jason M. Lemkin discusses Sam Altman's claim that AI needs a trillion dollars in capital spending. If AI usage grows ten-fold in 24 months, it could require 200 times current infrastructure. A trillion-dollar spend would be a third to half of all U.S. corporate investment, making it likely metaphorical rather than literal.
Do you think that trillion is a real number or a metaphor? Let's start with that. No company on the planet has spent a trillion dollars in CapEx ever, right? Do you think that's a budget estimate for the next 5 years or do you think it's just some out of my ass conceptual number?
I think everything he says is very thoughtful. I think he needs a trillion. I think we're all going to live in AI 24/7 and we're all going to use 10 times the tokens and 10 times the compute we are now in 24 months. Like, help me do the math. If we're using AI buy 20 times more a day and 10 times more tokens, if all things were equal, which they're not, how much more do we need to spend on infrastructure to spend 200 times what we're doing today? What's 200 times today? I mean, I know there's not enough capital in the world, but it doesn't—
But don't gloss over that minor problem. I mean, the odd thing now is we're at the stage where the size of this single trend is now capable, as you correctly point out, of influencing macro trends, like global aggregate trends. As you say, it's 37% of the stock market. It's a significant percentage of total domestic CapEx investment. I mean, I went and checked. Turns out corporations invest a total of $2 trillion, of which roughly a trillion is on buildings and shit, and roughly a trillion is on capital equipment. So basically we're talking about taking a third to a half of everything we invest in everything in the US. I don't know if I think we may have reached the point where, as I say, I think these are numbers as metaphor rather than numbers as real doable numbers. I think the aha here is we're going to spend a lot more than we ever did. It's hard for me to imagine it's a trillion, and it's also even harder for me to imagine if it is a trillion that it pencils out. Now, Sam Altman is so, so smart, and he even worked into the same comment and he said all the economists will be wringing their hands. And maybe I'm just doing that and wringing my hands. He's very good at anticipating the counter comments and preempting them. He's such a talented guy for that. He did that. He did the people are going to lose money. So it's like those, because when people say it's not a bubble, it attracts antagonism and people want to argue with them.
