$MSFT CEO discusses DeepSeek, AI costs, and scaling:

"..what's happening with AI. It's no different than what was happening with the regular compute cycle. It's always about bending the curve and then putting more points up the curve. So there's Moore's Law that's working and hyper drive. Then on top of that, there is the AI scaling laws, both the pretraining and the inference time compute that compound, and that's all software. You should think of what I said in my remarks, which we have observed for a while, which is 10x on improvements per cycle just because of all the software optimizations on inference. And so that's what you see.

And add to that, I think DeepSeek has had some real innovations. And that is some of the things that even OpenAI found in '01. And so we are going to -- obviously, now that all gets commoditized and it's going to get broadly used. And the big beneficiaries of any software cycle like that is the customers, right? Because at the end of the day, if you think about it, right, what was the big lesson learned from client server to cloud? More people bought servers, except it was called cloud.

And so when token prices fall, inference computing prices fall, that means people can consume more, and there will be more apps written. And it's interesting to see that when I referenced these models that are pretty powerful, it's unimaginable to think that here we are in sort of beginning of '25, where on the PC, you can run a model that required pretty massive cloud infrastructure. So that type of optimization means AI will be much more ubiquitous. And so therefore, for a hyperscaler like us, a PC platform provider like us, this is all good news as far as I'm concerned."
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