Grok Bot demand forces SpaceX usage cuts as AI compute stays pricey
Sawyer Merritt argues AI compute cost-per-watt will stay elevated: under 5% of US consumers pay for AI, yet Grok Bot's popularity already forced SpaceX to cut usage capacity.
I think AI compute cost-per-watt prices are going to stay elevated a lot longer than many people expect. Less than 5% of U.S. consumers even pay a subscription for an AI product, with some putting the estimate <2%. People are clearly finding Grok Bot to be very useful because @SpaceX just had to significantly cut back usage capacity due to overwhelming demand. But we're still so early in the AI adoption curve. Existing users are going to eat up significantly more compute as models get better and agents start handling increasingly complex tasks and jobs. Inference will increasingly become a larger and larger share of compute capacity. People are seriously underestimating how much demand is still ahead of us and how long it'll take supply to catch up. I think this is partly why Elon thinks SpaceX could exit 2027 with an annual recurring revenue rate of $500 billion to $1 trillion. They can deploy the compute faster than anyone else, and the demand for that compute is insatiable, and likely will be for a long time to come.