Compute isn't getting cheaper: a16z report shows intelligence demand outpacing cost declines
LadyAshBorg · x · 2026-10-06
- The author pushes back on the comforting narrative that compute will get cheaper and today's ugly gross margins will fix themselves, citing a16z's latest State of Markets report.
- Key facts: demand for intelligence is expanding faster than the industry makes it cheap; new GPUs keep getting more expensive; older A100s are retaining value far longer than bears expected.
- Enterprise deployment remains extremely shallow — a big opportunity gap for founders, but also a signal for who survives the cycle: business models banking on falling inference costs face real risk.
Related event: a16z Report: Aging GPUs Gain Value as Compute Stays Costly(2 posts)→
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