Computer hardware, which makes up most AI data centers’ cost, may be more susceptible to becoming obsolete and replaced by more advanced technology during the AI boom as opposed to wireless and internet buildouts, much of which still runs today, George Calhoun, professor and director of the Hanlon Financial Systems Center at Stevens Institute of Technology, told Fortune. “The cycle of innovation in the chip industry is much faster than for wireless technology or fiber optics,” he explained. “There is a real risk that much of that hardware may become competitively disadvantaged by newer technologies in a much shorter timeframe,” before being fully paid off. At the same time, big players in the AI boom—namely OpenAI—do not have the profits currently to cushion their massive investments at the moment, increasing their risk, Calhoun said.
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