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Intel's Supply-Constrained Turnaround

Programming note: The next issue lands 30 January, where we'll take a look at the state of the AI economy. Hand-to-Mouth at the Foundry The central wager at Intel is that the world really needs a high-end alternative to TSMC, and that being a U.S.-based company
Intel's Supply-Constrained Turnaround

The Last-Mile Problem of AI

Build vs Buy The core value proposition of the enterprise software industry has always been a trade-off between complexity and convenience. Building your own custom software used to be incredibly expensive and risky, so you instead paid a monthly fee to a company like Salesforce or Intuit. In exchange for
The Last-Mile Problem of AI

OpenAI Wants Google's Clicks

ChatGPT's Ad Machine If you own the front page of the internet, your business model usually relies on a very specific type of math. Google handles roughly 14 billion searches every day, but the vast majority of those are economically worthless. If you search for "what time
OpenAI Wants Google's Clicks

The Quantum 2012 Moment

Programming note: ARPU will be off this week, back on Monday. Shovels for the Next Gold Rush If you are a global bank, you sometimes find it useful to tell your shareholders that you are on the cutting edge of technology. You want to suggest that you are using the
The Quantum 2012 Moment

Construction Firms with Software Valuations

Macrohard is Very Hard The ultimate goal for many Silicon Valley startups is to eventually become a software company. Software is a great business model because its second copy costs the same to produce as its billionth: essentially nothing. It escapes the physical economics of the factory floor, promising high
Construction Firms with Software Valuations

Physical AI's Convergence Play

Autonomous Cars Have Grown Legs Two massive, parallel industries have long spent hundreds of billions of dollars trying to solve one very specific, shared problem: how to navigate the messy, unpredictable physical world without hitting anything. The first industry was self-driving cars. The second was industrial robotics. The goal in
Physical AI's Convergence Play

The Nuclear Scrapyard

Bomb-Grade Data Centers If you want to build a nuclear power plant in the United States, your primary obstacle is not the laws of physics. It is the Nuclear Regulatory Commission. The NRC is the world's most meticulous gatekeeper, overseeing a civilian licensing process so thorough, so expensive,

Brookfield Enters the Cloud

Your Landlord Wants Your Margin The hierarchy of the cloud has always been well-defined. At the top sit the "hyperscalers"—companies like Amazon, Microsoft, and Google—who write the software, manage the customers, and capture the massive margins. At the bottom sit the infrastructure providers: the companies that
Brookfield Enters the Cloud

The Yield Tax

Beijing's Procurement Rule If you manage a multi-billion dollar semiconductor fab, your professional life is governed by an unforgiving metric: yield. Yield is the percentage of chips on a silicon wafer that actually work. In the world of advanced processors, the difference between a 90% yield and an

Google's Power Play

The Energy Carve-Out The story of the AI build-out is simple: you need more chips, which need more data centers, which need more power. An almost comical amount of power. The obvious solution, if you have infinite money, is to just go out and buy a power company. And so,
Google's Power Play