00:15:53 · John Coogan, Tyler
[00:15:53] S1: Yeah. Yeah. My my yeah. Tyler, what's up? [00:15:57] S5: Yeah. Was gonna say, maybe a comparison to Apple here, which is, like, I I think Meta can actually wait until, like, the the features that they need to implement are, like, extremely obvious. Mhmm. Right? Like, Apple waited a long time to actually implement these things even though everyone was, like, basically begging. I I don't know if people are, like, begging for AI features in Instagram and maybe that'll happen in the future and they can just basically just wait while like, oh, we're not really sure how to implement this stuff. Yeah. You can put in the search bar or whatever, it doesn't improve the experience that much. But maybe, you know, in a year or two, there's gonna be some feature that like, wow, everyone really wants this in Instagram. By then, you know, they'll have all the compute necessary. They can, you know, ninety days before they implement it, they they can, you know, get out of the the lease or whatever.
00:16:36 · John Coogan, Tyler
[00:16:36] S1: Yeah. Yeah. Yeah. It's interesting. I feel like they just need to do more product experimentation. Like, the core the core Instagram team, they launched the the what's it called? Glimpses or something? It's like a shorter even shorter version of Stories, like lower. It it, like, sits in, like, this little sidebar of the chat. Like, they are launching different features across the family of apps, but that culture like, it feels like they have research organization, but they don't have an AI product organization that's actively productizing things as quickly. I mean, Meta Vibes for, you know, even though it was like this white label of mid journey was well, at least it was launched fast. And at least they got the feedback. [00:17:12] S5: Yeah. I mean [00:17:13] S1: I would have liked it to see a meta vibes level effort like once a month. [00:17:17] S5: Facebook has I I don't think like meta whatever. I don't think they've ever been like the the company that like really innovates on on product. Right? Yeah. There's gonna be some some feature that everyone's like, wow, this is really great for AI. And then they can then [00:17:29] S1: Copy it. [00:17:30] S5: Just integrate it and tell their apps. Buy it. They have all the capacity to serve it by that point.
00:17:34 · John Coogan
[00:17:34] S1: Yeah. I don't know. I don't know. I don't know where it goes. Amit is investing over there, shares his perspective, two perspectives on the Meta news. He says bearish. The bearish take is if Meta has excess compute that they are willing to sell via a new cloud business, doesn't that mean we aren't compute constrained? Isn't this really bad for NeoClouds? Why would Meta give a deal to CoreWeaver, Iron, if they just sell the compute themselves? Furthermore, wouldn't they cut CapEx because idle compute as the basis for a new business means they don't need as much compute as they bought, which means CapEx should come down. That would be bearish for all semis. The bullish take is if Meta is building a cloud business, even if they are using idle compute, which means they aren't compute constrained, they might end up spending more on CapEx to compete with GCP, AWS and Azure. Like if they realize that selling computing services on top of MetaCloud is better than just ads, then wouldn't they end up having to spend in the same way that Google, Microsoft, Amazon do in order to build out a full cloud business? They do have a lot of capabilities in terms of spinning up data centers quickly, maybe not quite as quickly as SpaceX and AWS, but they're certainly, like, near the frontier of that capability in terms of putting up GPUs in tents. So more CapEx would be good for semi. So what do people think? Where do we land on this? The market is certainly reacting positively to Meta and negatively to the NeoCloud because there's a new competitor in town.
00:19:00 · Jordi Hays, John Coogan, Tyler
[00:19:00] S0: Anyway Zephyr and the Sattrini team are going pretty hard. Say LMAO. Zac finally takes the L. [00:19:08] S1: If this is a metaverse style side quest and the super intelligence meta trained models are the VR of this cycle for Meta's attempt at a new business creation. And the meta trained models get sort of mothballed in the way that the Meta Quest and the VR strategy got mothballed. What is the meta Ray Bans of MSL? Like what would what would remain? Because when they wind down one of these projects, sometimes you get a meta Ray Bans, which is pretty good business and growing and and cool and like there's development there. But it's a much more narrow focused. And I would say image model but they they seem [00:19:53] S5: But wouldn't it just be this like NeoCloud business? [00:19:55] S1: Maybe. [00:19:55] S5: Yeah. That's what's gonna stay on. That's most [00:19:57] S1: fun as Ray Bans though. I want a consumer product. It's a consumer company. [00:20:02] S0: Yeah. And it's interesting because you can you can make the case that Meta could build an amazing inference business. Yeah. Right? Because they already they already serve millions of businesses Mhmm. Globally. [00:20:18] S1: Yeah. [00:20:19] S0: And they could make a pretty compelling case for how like, hey, we help people acquire customers and we help people deliver products and services over here.
00:20:19 · Jordi Hays, John Coogan
[00:20:19] S0: And they could make a pretty compelling case for how like, hey, we help people acquire customers and we help people deliver products and services over here. [00:20:30] S1: Yeah. We've talked about that before. I don't know that I buy that the fact that they have, like, you know, single mobile gaming company and d to c e commerce business on is actually flows over to, well, now get your tokens from us. [00:20:44] S0: Yeah. I just think that like people have it in their head like, Meta is a consumer business, right? It's thought of as like a consumer business. But they have massive sales teams, account management They know how to get in front of customers. Yeah. They've got to the point where, you know, again, they they're not operating a commodity business, right? Yeah. Having their, you know, social networks. Cloud is is closer to one. Mhmm. But anyways, I'm interested to see. I imagine they'll have to come out with their own kind of news around this pretty quickly so that they're not sitting in limbo with just one kind of rumored article floating out there and people are speculating. Ju Khan is saying Meta falls out of the AI race. He's over at Satrini as well. Too soon to say that, probably. They still have Yeah. A bunch of amazing talent. They certainly have a lot of GPUs. Yeah. And, you know, Elon getting into the cloud business, certainly [00:21:47] S1: Yeah. [00:21:47] S0: He was not seeding Yeah. The AI race. Right? I think he seemingly is as motivated as ever to to do what he can to win or at least be a player.
00:21:57 · John Coogan
[00:21:57] S1: It's just it's almost like the curse of size or something. Like, you're when you're a trillion dollar company, there's probably a world that the Meta Ray Ban display is a good example of like or Meta Ray Ban's a good example of like there's there's probably a piece of consumer hardware that's AI enabled, like the Ring or something where or or just getting really good at voice models or just getting really good at image models. And if they're a little bit more narrow and constrained, they could probably completely dominate that. But trying to do super intelligence and coding agents and it's a little it's a little scattered potentially. Serenity says there's a lot of disinformation going around about Meta cutting CapEx because they quote overbuilt. This is an if they have excess capacity and looks like the opposite right now. Hyperscalers like Google are so much are so compute constrained that they have had to cut allocations to Meta back in March since Meta was using too much for internal projects. Meta was immediately constrained, so it looks like they were forced to immediately sign massive $48,000,000,000 contracts with NeoClouds like CoreWeave and Nebias. Meta is selling excess capacity if there's any, especially since their large contracts are take or pay from the newer NeoClouds. Yeah. This all could just be like a a a potential like you're laying the groundwork in case you wind up in a situation where that is where the value is occurring, that's where the advantage for Meta is. So there certainly is a positive thesis there. Jae Eun says, We are still massively short compute. Meta and XAI are selling compute because there's no inference demand for their models. It's a compute allocation problem. Too much compute in the hands of players with no internal use for it, Not a compute surplus problem. Interesting. Well, we can continue to cover the story.