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As AI systems get smarter, they will monetize the same amount of compute far more effectively, so the price of compute will rise dramatically before roboticization of the supply chain eventually brings it down.
The author relays Dwarkesh Patel's argument that smarter AI monetizes compute better, so prices will climb (an H100 could rent for $250k+ a year), though this is a temporary state before roboticized supply chains bring costs back down near raw inputs. ✦ AI generated
Dwarkesh Patel · Import AI · 2026-08-03 · original ↗
As AI models become smarter, they'll better monetize the same amount of compute. If a true human-level software engineer that could run on an H100 equivalent, at current market rates for software engineers, that H100 should rent for over $250k a year. That's 15x today's spot prices. The reason AI is relatively cheap right now, at least in comparison to human labor, is partly that it can't do a lot of things that top humans can do. At some point that will no longer be the case. And so using GPUs to make short-form video slop will just get priced out.
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- ·As AI models improve, they monetize compute more effectively
- ·A human-level software engineer on H100 → $250k+/year rent
- ·That's 15x today's spot price for an H100
- ·AI is cheap now because it can't match top human labor
- ·Once AI surpasses human capability, low-value uses get priced out
- ·Roboticized supply chains will eventually crush costs back down
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