alt Hacker NewsI think they mean that the DeepSeek API charges are less than it would cost for the electricity to run a local model.
Local model enthusiasts often assume that running locally is more energy efficient than running in a data center, but fail to take the economies of scale into account.
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Some of those local model enthusiasts can actually afford solar panels.
Local enthusiasts don’t have to fear account banning.
I guess it mostly comes from using the model with batch-size = 1 locally, vs high batch size in a DC, since GPU consumption don't grow that much with batch size.
Note that while a local chatbot user will mostly be using batch-size = 1, it's not going to be true if they are running an agentic framework, so the gap is going to narrow or even reverse.
Is it economies of scale, or is it unpaid externalities?
> Local model enthusiasts often assume that running locally is more energy efficient than running in a data center,
It is a well known 101 truism in /r/Localllama that local is rarely cheaper, unless run batched - then it is massively, 10x cheaper indeed.
> I think they mean that the DeepSeek API charges are less than it would cost for the electricity to run a local model.
Because it is hosted in China, where energy is cheap. In ex-USSR where I live it is inexpensive too, and keeping in mind that whole winter I had to use small space heater, due to inadequacy of my central heating, using local came out as 100% free.