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Perplexity CEO Says On-Device AI Is the Biggest Threat to Data Centers

He says no company has shipped a local model capable enough to supplant server-based AI.

Overview

  • Speaking on a YouTube podcast with Prakhar Gupta, Aravind Srinivas argued that compressing advanced models onto device chips would sharply reduce reliance on centralized inference.
  • He said "the biggest threat to a data centre is if the intelligence can be packed locally on a chip running on the device," suggesting a more decentralized, personal model of AI.
  • Srinivas highlighted privacy and instant responsiveness as key benefits of local processing, contrasting them with data centers’ heavy electricity, cooling and water needs.
  • Coverage notes device-makers are moving in this direction, citing Apple’s private-computing push, Samsung’s on-device Galaxy AI features, and Google’s Tensor-based approach on Pixel phones.
  • His remarks land as companies invest in much larger facilities and even explore space-based data centers, underscoring a split between mega-infrastructure and device-first strategies.