Platformonomics TGIF is a weekly roll-up of links, comments on those links, and perhaps a little too much tugging on my favorite threads.
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Another week! CAPEX rules everything around me. Or maybe chaos.
News
CAPEX Clues: Microsoft’s “Couple Hundred Megawatts”
Bit of a freakout this week over rumors Microsoft had delayed or cancelled a “couple hundreds megawatts” of capacity. This doesn’t seem very well sourced and Microsoft reiterated its $80 billion CAPEX guidance, but still has been seen as bearish for Microsoft stock (and the AI trade overall, but more so for Microsoft).
I don’t understand this as 1.) even if true, ~200 megawatts is a rounding error in their plans 2.) Microsoft gave up their seat on the Open AI CAPEX Train to Infinity and Beyond to Softbank, so there is a strategy transition going on which could lead to build-out shifts 3.) less spending drops straight to free cash flow 4.) models commoditizing is good for Microsoft as they focus up the stack and 5.) efficiency gains as demonstrated by DeepSeek similarly help them. But Wall Street of late seems bent on demonstrating that markets are not actually very efficient (Hello DeepSeek!).
CAPEX Clues: Enter LlamaGate
CAPEX Clues: Amazon CAPEX != AWS CAPEX
Your periodic reminder that Amazon has a half-a-trillion dollar retail business that also consumes some CAPEX with ambitious plans:
While most of Amazon’s planned $100bn in capital expenditure this year will be spent on expanding AI initiatives such as computing infrastructure, about a quarter will be directed at its ecommerce arm where the business is investing heavily in automation, according to analyst estimates.
Salesforce is Not a Technology Company: Nor an AI Company
Benioff might want to sit down with Scott McNealy for a lesson on how spending your time talking trash about Microsoft while your business gets devoured by other competitors can lead to unhappy outcomes.
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2025 Will Not be the Year of Agentic AI, The Agentic Abyss of Disillusionment, Salesforce is Not a Technology Company: Nor a Dogfood Company, What’s Bugging Marc Benioff – Continued, Benioff’s Blizzard of Bluster, Salesforce + Indian Mystic + AI = ???, “There’s an art to this kind of horseshit, and Benioff is its Michelangelo”, The Hard Thing About “Hard Pivots”, Thought Leadership (in Mascots), Salesforce Rallies Its Deep Bench of AI Experts (and Cartoon Characters), Bluster, Bombast and Bullshit: Just Another Day at Salesforce, Salesforce’s Shamelessness is Staggering, Salesforce Gonna Salesforce, The Spectacle that is Dreamforce
Not Available in Europe: Bird Flies
I’m really trying to go easier on Europe as my complaints have gone from dismissed outright, to uncontroversial, and have become Manichean (with comic book levels of subtlety in their delivery). But it is so hard. The EU can only do better with tech when it isn’t the EU talking about tech in the EU.
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Not Available in Europe: Open AI Deep Research, Not Available in Europe: A Bubbly Economy, Not Available in Europe: Better Late Than Never Apple Edition, Not Available in Europe: Apple’s Math, Not Available in Europe: This Week’s Edition, Not Available in Europe: Coming Soon to a Continent Near You, Not Available in Europe: Don’t Say You Weren’t Warned (by Meta), Not Available in Europe: A Tipping Point?, Not Available in Europe: Stratechery Edition, Not Available in Europe: Apple Edition, Not Available in Europe: Meta Edition, EU Insanity: Peak EU AI Regulation?, ClownWatch™: The European Union, Existential Corner: EU Agrees It Faces ‘Existential Crisis’, EU and What Army?, EU Insanity: Thierry’s Termination Tizzy, EU Insanity: Experts Agree, EU Insanity: EU Goes Too Far, Even for EU, Move Fast and Regulate Things: Welcome to the Morning After, Move Fast and Regulate Things (You Don’t Understand), When “Move Fast and Regulate Things” Breaks Down, AI Regulation: Move Fast and Regulate Things, EU Insanity: Regulating Blue Checks, EU Tweets While Ukraine Burns, EU Insanity: AI Regulatory Suicide, EU Insanity: Mistral Edition, The EU Will Continue to Fiddle While Rome Burns, EU Insanity: AI Energy Suicide, EU Insanity: AI Energy Suicide (Part Deux), The European Union is STILL an Advanced Persistent Threat, BREAKING: European Union Designated an Advanced Persistent Threat
Viewer Mail Episode 3 – Elon’s Telsa Strategy
There was no mail. Not a single one of you replied to last week’s request for theories on how Elon was going to solve his Tesla problem. Should I be disappointed or is it just an intractable problem? Meanwhile, Q1 marches forward.
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What is Elon’s Tesla Strategy?, Shakedown-as-a-Service, Elon Announces $97.4 Billion Spite Budget, Fractional CEO Adds to Responsibilities, Elon’s “Just Irresponsible” Gigafactory of Compute, Can Elon Build a Data Center?, Pollyanna Showdown, The Supreme Court has Ruled, Elon Musk Threatens to Ban Oracle?, Who’s Getting the GPUs? Elon Shell Game Edition, Platformonomics ClownWatch™: Tesla, Useful Idiots, Fellow Travelers and Unregistered Foreign Agents: Elon Musk Part II, Useful Idiots, Fellow Travelers and Unregistered Foreign Agents: Elon/Twitter, Company Killed By Its Customers, Elon Cashes in All the Trust He’s Banked with Twitter, Do Not Take a Dependency on Elon Musk: Chapter 147, Do Not Take a Dependency on Elon Musk: Chapter 148, Do Not Take a Dependency on Elon Musk: Chapter 149, Viewer Mail – Episode 2, Viewer Mail Episode 1
Word of the Week: Orthogonal
An early (if entirely unofficial) project at Microsoft was an “MBA to English Dictionary”. Orthogonal was of course an entry. I realize now it was not so much MBA-speak as Microsoft’s own math-infused dialect. “Monotonic” was another favorite, that was often utilized in the form of “the stupidest thing…”.