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.
00:23:45 · Jordi Hays, John Coogan, Tyler
[00:23:45] S0: More meta news. [00:23:47] S1: What is that? [00:23:48] S0: Apparently, according to Bobby Allen over at NPR [00:23:51] S1: Oh, yeah. [00:23:51] S0: Had to consider buying Kalshi [00:23:53] S1: Yeah. [00:23:53] S0: Before it's developing its own prediction market app that is, sort of a classic meta [00:24:00] S1: Mhmm. [00:24:01] S0: Playbook. This sort of puts to bed your theory that, they might be just making a a, you know, Clout based. Clout based prediction markets where you compete for your ability to I see the [00:24:16] S5: Like I'm still Manifold is that, right? Yeah. So it's like a it's like a pretty big platform. [00:24:22] S1: Yes. But I was saying there's a chance right now based on the reporting that it could be the Manifold strategy or it could be the Polymarket Call Sheet strategy. And the fact that they didn't try and acquire Manifold, they tried to acquire Call Sheet sort of signals like, hey, they're probably going the the financially incentivized route which I think fits with your thesis that it's in consumer, it's profitable and growing very fast. And also Tarek from She was taking shots at Instagram saying it's brain rot. Saying that like every minute you spend on Call She is a minute that you're not spending brain rotting on Instagram, which is like, okay. I think a lot of people would say that these are like equivalent or maybe one is worse than the other. But, you know, that's a way to get attention.
00:25:07 · Jordi Hays, John Coogan, Jeffery Liu
[00:25:07] S0: Don't you think that so the potential pool of profits in prediction markets and and sports betting broadly, think in the last year was it a 100 and Tyler, can you check? I think it was like a 160 ish billion of like trading volume that is not at all equivalent to revenue, obviously. Yeah. But it doesn't It feels like, again, it's not a space that It's a space that has consistently had many many many players. Yeah. Wildly different than, you know, Meta's core social networking business. And I just wonder is like, is the potential profit pool Mhmm. Risk the attention that worth the risk of all the attention you're gonna get from lawmakers globally Mhmm. By integrating integrating like betting Mhmm. Into the product that is already under attack on like a million different fronts. Right? It feels like With [00:26:06] S1: the movie coming out and stuff, it's like you're jumping straight to [00:26:09] S0: the It feels like you have a golden goose. Right? And the goose is getting valued. [00:26:14] S1: The goose is getting valued. I'm gonna [00:26:16] S0: just keep going back to these slides. [00:26:17] S1: I love these slides. [00:26:18] S0: The goose is valued. It's producing golden eggs and you see another golden egg but it's almost like a poisoned golden egg. And if you bring it over [00:26:27] S2: Yeah. [00:26:27] S0: It might to the farm Spoiler goose. [00:26:29] S1: Okay. Yeah. [00:26:29] S0: Might kill your your main goose. [00:26:30] S1: Potentially. And so [00:26:31] S0: it feels feels risky. [00:26:33] S1: Yeah. I I just sent in