Actually open weights models have gotten better and better to the point they actually can compete meaningfully with ChatGPT and Claude Sonnet. Nvidia are actually one of the ones spearheading this with Nemotron. The issue is more that most of the really competent models need lots of VRAM to run. Small models lag quite far behind. Although with Nemotron Nano they are getting better.
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Well yes but it's not like this is the first time very expensive hardware was entirely expendable or even the first time it makes sense to do so. Look at the Saturn V. It cost something like a billion per rocket in today's money and each one could only be used once. You had to build a whole new rocket every time you wanted to go to the moon. That's just how things were with the technology available at the time. The funny thing is it was actually cheaper per launch than the Space Shuttle in the end despite the space shuttle being mostly reused/refurbished between launches.
Data center hardware has always had a limited lifespan due to new technology making it obsolete. Improvements in efficiency and performance make it cheaper to buy new servers than keep running old ones. I am pretty sure 5 or 6 years was already roughly the lifespan of these things to begin with. AI hasn't really changed that, only the scale has changed.