01:11:22 · John Coogan, Joey Brookhart, Jordi Hays, Doug O'Laughlin
[01:11:22] S1: Yeah. [01:11:22] S8: And they, you know, they'll be adding a lot more of those compute commitments, I'm sure. [01:11:26] S1: Sure. Sure. But but after IPO, after quarterly earnings, after continued profitability, something that can underwrite it, maybe getting... [01:11:34] S0: Get me up to speed on how the original SpaceX compute deal actually works because if I remember correctly, it was like they were getting access to a lot of compute but able to sort of like forego payments against that for some amount of time, which I imagine was hitting in second half of the year, like the payments really coming online relative to how much compute they were accessing. Is that the right way to think about it? [01:12:01] S6: I don't recall that specific... Yeah. [01:12:03] S8: We we saw it a little bit in SpaceX earnings last week [01:12:06] S1: Yeah. [01:12:06] S8: Start to come through. [01:12:07] S1: Sure. [01:12:08] S8: So it was... I I think it was pretty normalized for for both companies. We saw it, you know, in both the compute margin numbers at Anthropic, Q3 versus Q2, and in SpaceX earnings. [01:12:18] S1: Yeah. About... Oh, sorry. Sorry. [01:12:21] S6: The odd part is just the ninety days. The fact that SpaceX can like essentially whip it back, You Yeah.
01:12:21 · Doug O'Laughlin, John Coogan, Ivan Zhang, Joey Brookhart
[01:12:21] S6: The odd part is just the ninety days. The fact that SpaceX can like essentially whip it back, You Yeah. [01:12:26] S1: Yeah. What what about the overall compute strategy and diversity across the neo clouds? Obviously, Anthropic has really big contracts with Broadcom and the hyperscalers. But for some of those neo clouds, there was a lot of rumbling with Elon about the, know, neo clouds over the weekend. Like, how does this s one change the calculus around just neo cloud economics? What a good Neo Cloud looks like. You obviously have ClusterMax to understand the capabilities of the Cloud, but it feels like the financing side is also increasingly as important as the capabilities. [01:13:06] S9: Joey? [01:13:07] S8: Yeah. I mean, you have a good backer and a good backstop, so whether that be a hyperscaler for NeoCloud or an AI lab, I think Anthropic has shown today AI inference is a really great business. Even running the training is extremely profitable. So compute margins are excellent. If them and chip company or hyperscaler are backstopping a Neo Cloud and they have operational excellence in how they operate those new clusters, it's, you know, Clouds are still very good businesses that have increasing monetization tailwinds behind them. [01:13:38] S1: Are you starting to see this, like the long rumored neo lab to neo cloud pivot happen yet? Either of you, I guess. Doug?
01:13:38 · John Coogan, Doug O'Laughlin, Jordi Hays
[01:13:38] S1: Are you starting to see this, like the long rumored neo lab to neo cloud pivot happen yet? Either of you, I guess. Doug? [01:13:49] S6: On on the margin, I think so. Yeah. I think people are... People really wanna be selling tokens. Uh-huh. If you look on the the fact that DeepSeek v 4.1 is probably the reason why all these types security hacks are happening Mhmm. It's pretty clear that if you have the gigawatt and you can you can place it with an open source model, you know, I I wouldn't call that, like, a Neo Cloud, but, like, tokens as a service, I think, is going to increasingly happen, especially as the volume of open source models continues. Also, I wanted to adjust one thing. Please. I feel like Elon is shitting on the Neo Clouds because he's also a Neo Cloud. Yeah. He's just like, I'm I'm I'm the biggest Neo Cloud. Those guys just aren't as good as me. That's really what it [01:14:27] S1: comes out. No. I mean that that's... No. Said that exactly. He was like, yeah, if you don't have other revenue. [01:14:31] S0: Yeah. The the the points that he's making are self serving but it also makes sense that a lender would rather lend to somebody that like has revenue that's diversified. So it's it's like you he can be like trying to further his own interest while at the same time like being like having like a pretty coherent like thought [01:14:52] S1: that Both [01:14:53] S0: can be true.
01:14:53 · Jordi Hays, John Coogan, Doug O'Laughlin
[01:14:53] S0: can be true. [01:14:53] S1: Yeah. Yeah. Yeah. What what what else can you tell us about the nature of all the cybersecurity threats? Like, how much is it actual inference of deep seek, as you mentioned, versus just piggybacking on cyber, you know, different exploits that have been discovered by other folks? Like, how how relevant is compute in the cybersecurity battles that we're seeing playing out right now? Do you have a do you have a grapple on that yet, Doug? [01:15:22] S6: Mean, I think I think compute's pretty relevant here because it seems like a bozo model can probably hack your your your infrastructure. It doesn't really take much. I think the bar is surprisingly low, and I think it's in all of our interests, like, not to talk about how low the bar is, if I'm gonna be honest with you. Okay. [01:15:39] S0: And I [01:15:40] S6: think the the other... The... Like, it's it's, like, it's, like, surprisingly low. The other thing I think that's, like, also really kind of messed up is how asymmetric it is. It's kind of like a drone. You know? Like, it costs, you know, a $100 to fly the drone into the tanker, and it costs, like, you know, like, $2,000,000 to shoot the drone out of the sky or something. Yeah. That that dynamic, I think, is very replicated in AI as well. Meaning defense is... Costs, like, probably an order of magnitude more than a... Than than an attack. Mhmm. We've done some work on the attack side. The attack side, like, the raw tokens that come out of it, it's like it's like pitiful. It's like a $100 or something. It doesn't take a lot.
01:15:40 · Doug O'Laughlin, John Coogan, Jordi Hays
[01:15:40] S6: think the the other... The... Like, it's it's, like, it's, like, surprisingly low. The other thing I think that's, like, also really kind of messed up is how asymmetric it is. It's kind of like a drone. You know? Like, it costs, you know, a $100 to fly the drone into the tanker, and it costs, like, you know, like, $2,000,000 to shoot the drone out of the sky or something. Yeah. That that dynamic, I think, is very replicated in AI as well. Meaning defense is... Costs, like, probably an order of magnitude more than a... Than than an attack. Mhmm. We've done some work on the attack side. The attack side, like, the raw tokens that come out of it, it's like it's like pitiful. It's like a $100 or something. It doesn't take a lot. [01:16:16] S1: Yeah. Yeah. That makes sense. How... [01:16:18] S0: Yeah. It's such an interesting problem because we were talking earlier on the show of like, does there need to be like large scale white hat bounties, you know, billions of dollars allocated to like incentivize good people to go after and find these vulnerabilities, but at the same time, imagine introducing the chaos of like... I was using the example of like a Miami course bro being like, anyone can become a millionaire finding like vulnerabilities. Right? And they're like, here's how you take the obliterated obliterated model, point it at, you know, this legacy, you know, you know, Fortune 500, and all of a sudden, it's just like total anarchy.
01:16:56 · Doug O'Laughlin
[01:16:56] S6: Also, obliterated models, like, they can do the hack, but, like, you also shouldn't trust them, if that makes sense. Like, you don't really trust their incentives to, like, actually listen to you. Like like, the same problem of, like, steering it a little different also means that it could be doing things that you don't intend. Right? Yeah. You're giving it instructions, but you're like, okay. Hack it now. Fix it. It's like, well, wouldn't it be nice if there were some API keys? Right? And then then it can, like, you know, self proliferate it, like, the worst case. Sure. I think that that's kind of the big concern. And and, like, I'm sure you guys saw when when the hacks were going around. I mean, I still think there... The hacks are still going around. Yeah. Someone That had, like, a deep sea swarm essentially, like, know, patching old PHP. They're, like like, hack into old PHP and then patch it themselves. Yep. So pretty much, the only person that can stop a bad swarm is a guy with a good swarm. Guy with a good swarm. What I'm trying to say.