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OpenAI is walking away from expanding its Stargate data center with Oracle
- mikelitoris 7mo agoI hope the lawnmower goes bankrupt with this and the hostile WB take over.
- wilkystyle 7mo agoDon't anthropomorphize the lawnmower.
- thefounder 7mo agoFrom the consumer perspective the last thing I want is a Netfli-xation of WB…
- dylan604 7mo agoI also don't want the next Bari Weiss in charge of WB
- abacadaba 7mo agono of course not, but i have hope that she can fix cnn, fingers crossed
- linkregister 7mo agoIt was good, actually, that she suppressed accurate news unfavorable to the current President, tanking ratings and the network's credibility. I want more news outlets to decline. Except of course, my favorite, which doesn't count. It says it's fair and balanced; they wouldn't lie, would they?
- dev1ycan 7mo agoI hope this is satire
- abacadaba 7mo ago[flagged]
- sofixa 7mo agoOn the contrary, Netflix would have been decent because WB is bigger than them (in terms of IP, existing content, brands, etc) and would have probably (at least that's what they said publicly) left it mostly alone. And it's weird how people assume that just because Netflix produce a ton of content, all of it is low quality. A lot of it is for people half paying attention, but there is plenty of actually good stuff. Them having WB would improve them on both fronts. Nepo baby is coming with a political angle and wants control of the news media part of WB. The American media landscape is already without much competition nor diversity in political views, now there would practically be none.
- thefounder 7mo agoThe good Netflix movies are small diamonds in a swamp of garbage. Most of the content is the equivalent of fast food for movies with a political agenda. WB has not been immune to the political angle but they at least care about their IP and produce decent content. Of course Netflix would have used WB IP and Netflix’s “state of the art” movie making machine to maximise the value of the WB IP. TBH I don’t care about the WB news media part through I’m not sure if they will really destroy it just to align with their political views. If they make CNN like Fox News the viewers will just leave. The right move for Netflix from a shareholder’s perspective would be to get into the short drama movies that are popular in China and recently the US too. That would allow them to cover the whole garbage media spectrum and make a lot of money.
- sofixa 7mo ago> The good Netflix movies are small diamonds in a swamp of garbage. Most of the content is the equivalent of fast food for movies with a political agenda. What political agenda? Are gays existing in movies political for you or what do you mean? And again, Netflix have to play a numbers game. They need to have enough content for people not to leave them. That doesn't mean they don't also have genuine quality content like Better Call Saul, Peaky Blinders, Kaleidoscope, etc. > TBH I don’t care about the WB news media part through I’m not sure if they will really destroy it just to align with their political views They already started, appointing a political hack to be head of CBS, and CBS have already quickly turned very politically biased. Why wouldn't they do the same to CNN?
- bayarearefugee 7mo ago> I hope the lawnmower goes bankrupt with this and the hostile WB take over. Unfortunately there is no chance of that happening. At his level of personal wealth there is no realistic scenario that leads to personal bankruptcy. In our current capitalist society once you're into the billions you're "too big to fail" and you have unlocked the infinite money glitch. The only consolation is the lawnmower is 81 and thus is going to be dead soon (even the mega-wealthy can't plastic surgery themselves out of this outcome, at least not yet) and he can't take any of it with him. But all indications point to his progeny having aspirations to be even more damaging to society than he has been.
- gruez 7mo ago> In our current capitalist society once you're into the billions you're "too big to fail" and you have unlocked the infinite money glitch. That's not how any of this works. "Too big to fail" can be applied to companies, but I don't know of any examples of it being applied to people.
- bayarearefugee 7mo agoPlease provide a list of all multi-billionaires who have somehow managed to lose any significant portion of their wealth outside of a divorce combined with bad marriage planning. And even in those rare cases, they don't approach bankruptcy. It isn't that they get bailed out by the government (like the banks in 2008), it is that at the scale of their wealth there is no realistic way to lose it fast enough to make any significant negative difference when the neutral state of wealth at that scale is to snowball ever larger (mostly because we refuse to tax it appropriately).
- motbus3 7mo agoOmg. Oracle taking greedy bad decisions with tax payer money? No way!
- coliveira 7mo agoWhile Trump is in power, the bail out is a sure thing.
- nine_zeros 7mo ago[dead]
- happyopossum 7mo agoTFA says nothing about taxpayer money - this is about Oracle taking on debt...
- keeganpoppen 7mo agowhat taxpayer money?
- slopinthebag 7mo agoThe inevitable bailout.
- motbus3 7mo agoFinally someone said it
- jmclnx 7mo agoto me, seems the page is gone. This could be a related item: https://www.msn.com/en-us/money/general/as-oracle-plans-thousands-of-layoffs-in-favor-of-ai-data-centers-how-should-you-play-orcl-stock/ar-AA1XR4ve https://www.msn.com/en-us/money/general/as-oracle-plans-thou...
- deleted 7mo ago[deleted]
- sowbug 7mo agoWhat happens to older datacenter GPUs? Do they have a second life somewhere outside of datacenters? I could see Nvidia adding terms of sale requiring disposal rather than resale.
- AlotOfReading 7mo agoYou send them back to Nvidia or a third party e-waste recycler at end of life. Sometimes they're resold and reused, but my understanding is that most are eventually processed for materials.
- zasz 7mo agoIt seems like GPUs with a high utilization rate (60%+) degrade after 1-3 years: https://www.tomshardware.com/pc-components/gpus/datacenter-gpu-service-life-can-be-surprisingly-short-only-one-to-three-years-is-expected-according-to-unnamed-google-architect https://www.tomshardware.com/pc-components/gpus/datacenter-g... Would be interested to know if others have takes on this.
- latchkey 7mo agoI previously ran 150,000 AMD gpus in all conditions at 100% utilization for years. I currently have a multi-million $ cluster of enterprise AMD GPUs. A couple real world points: 1. They generally don't just fail. More likely a repairable component on a board fails and you can send it out to be repaired. 2. For my current stuff, I have a 3 year pro support contract that can be extended. Anything happens, Dell goes and fixes it. We also haven't had someone in our cage at the DC in over 6 months now.
- rurban 7mo agoI have to maintain our GPU's. Generally the worst parts are the watercooling pressure, the HVAC, and the power. I can run it stable only at 300W per CPU, the normal max is 310W. Now with throttling to 300 it's stable for a year, before it burned two mainboards already, with lots of downtimes.
- mcs5280 7mo agoThe only thing that matters is stonk++
- munk-a 7mo agoThe actions of oracle lately seem extremely misaligned to maximize stonks - it's extremely political, more than is necessary to merely keep in the good graces of the current administration.
- john_strinlai 7mo agotoo bad stonk is down 23% this year. i think they are doing it wrong
- conductr 7mo agoIt’s a huge gamble but they have no choice but to take it. Most their software will be rendered obsolete by AI (I’ve vibecoded replacements saving millions already, companies everywhere are doing this right now). So they have to hope they’re a part of the future in the AI capacity because their SaaS business is going to take a big hit. YTD performance didn’t fully bake this reality in. It was seen as them having 2 huge revenue streams, the market is realizing that AI is a threat to SaaS and baking that into stonks
- 0cf8612b2e1e 7mo agoI never thought I would see the day, but my stodgy, lumbering company just banned new Oracle databases. Everyone hates Oracle, and only does business out of necessity. I think more and more companies are trying to extricate themselves from Oracle legal, so Oracle needs a new way to leech onto corporations for the coming decades. AI is the best play in sight.
- hinkley 7mo agoDid you guys go out to celebrate? It's not too late for Ding Dong, the Bitch is Dead. If you're Oracle it's not necessary a bad thing if you build an antiquated data center. Isn't much of their customer base legacy customers they are rent-seeking from in perpetuity? Those people are never going to be doing cutting edge AI. They will do what they have always done: adopt new technologies right at the nadir of the Trough of Disillusionment.
- chb 7mo agoIs it possible that the supply of used GPUs available to home builders will somehow increase as the result of this?
- llm_nerd 7mo agoData centres are actually prohibited from using consumer level GPUs via license restrictions. The GPUs they use are largely SXM (server connector) and if you did somehow get one of the PCIe variants (with enormous power and cooling needs) most don't even support gaming APIs.
- ykl 7mo agoYeah, it used to be true that server GPUs at least somewhat resembled their gaming counterparts (i.e. Nvidia Tesla server components from 12+ years ago); they were still PCIe cards, just with server-optimized coolers, and fundamentally shared the same dies that the gaming and professional cards used. That stopped being true many years ago though, and the divergence has only accelerated with the advent of AI datacenter usage. The form factor is now fundamentally different (SXM instead of PCIe); you can adapt an SXM card to PCIe with some effort [1], but that may not even be worthwhile because 1. the power and cooling requirements for the SXM cards are radically different than a desktop part and more importantly 2. the dies are no longer even close to being the same. IIRC, Blackwell AI chips straight up don't have rasterization hardware onboard at all; internally they look like a moderate number of general SMs attached to a huge number of tensor core. Modern AI GPUs are fundamentally optimized for, well, mat-mults, which is not at all what you want for gaming or really any non-AI application. [1] https://l4rz.net/running-nvidia-sxm-gpus-in-consumer-pcs/ https://l4rz.net/running-nvidia-sxm-gpus-in-consumer-pcs/
- advisedwang 7mo agoPerhaps oracle going bust can be the silver lining to an AI bubble bursting
- wmf 7mo agoI don't believe that Stargate is "yesterday's data center". It's being built in multiple phases and Oracle has access to Nvidia's roadmap. They know 200 kW/rack is coming. The newer phases could easily be built out to support Rubin and Feynman.
- harry8 7mo agoSo what's the theory that goes with this about why cnbc are reporting that openai are walking because they want newer nvidia hardware? CNBC are clueleess? People at openai are lying to cnbc? cnbc are fabricating stories while drunk? There has to be some theory to explain the story to be consistent with this comment.
- wmf 7mo agoSomething is probably happening but I don't know what it is. Maybe this is really a negotiation over price.
- collabs 7mo agoI agree with you more than I agree with the parent comment. To use the hit HBO TV show silicon valley analogy, it is far more likely that "the bear is sticky with honey" will happen at Oracle than at Open AI. Some kind of game of telephone gone wrong at some point and now the people responsible at Oracle must double down in order to kick the can to the next quarter and not appear clueless. Statutory disclaimer: I am not affiliated with either Open AI or Oracle and have no insider information. All of this is mere conjecture and has no basis in reality.
- TacticalCoder 7mo ago> CNBC are clueleess? That sounds about right. > People at openai are lying to cnbc? Remove "to cnbc" and that's a yes. > cnbc are fabricating stories while drunk? Maybe not drunk but likely high.
- cyanydeez 7mo agoOpenAI is a unreliable narrator as long as Sam is in charge. Full stop. EM_DASH.
- hristov 7mo agoWhat the article did not mention is that oracle founder, executive chairman and biggest stockholder larry ellison is currently bankrolling his kid David's bid to monopolize the entire US news industry so that they are more friendly to Trump, Netanyahu and various other right wing ideologists. David Ellison is fueling his buying spree with debt guaranteed by his dad's oracle shares. The various assets David has bought are already suffering losses of viewership because viewers are turned off by their new ideological slant. Usually debt investors are not worried if the stock price is high. Debt has precedence over equity, so if the stock price is riding high, the CEO can always be convinced to print more shares to service the debt. The Oracle stock price has not been doing that hot lately, however. As the article said, it is 50% down. Still ORCL has 430 Billion market cap in comparison with 130 Billion of debt. It seems manageable. But stock prices can move very fast. Ironically, the war in Iran, which David's new news sources keep supporting is causing ORCL stock to go down which can bring down David's new media empire. David just purchased Warner Bros for about 110. A lot of that (40 billion) is also guaranteed by daddy's ORCL shares. Warner Bros owns Comedy Central, which sadly has been one of Americas most dependable news sources. The house of cards is still standing but its getting awfully wobbly.
- christkv 7mo agoThis is general compute hardware as I understand it. It will not go unused no matter what happens. If new algorithms appear that reduce the number of calculations needed per token for an llm they are probably still good. It's not like silicon advances are accelerating. If it's built in stages each state will have never variants of hardware I imagine.
- 0cf8612b2e1e 7mo agoGeneral purpose compute with an odious partner. I would pay a premium to not fear Oracle lawyers auditing my usage.
- christkv 7mo agoI'm definitively not interested in buying oracle servers but I imagine AWS and Microsoft are also building out aggressively.
- yalogin 7mo agoThis is a pretty damning headline and we are still talking about Blackwell. I guess that is how fast the whole segment is moving but OpenAI and only looking for the most advanced chips feels more like an excuse to walk away from this deal rather than a problem with the stack and oracle. Feels to me that OpenAI is cutting down on commitments and cost as it doesn’t see the revenue pipeline building. May be someone with more knowledge of the reality can comment and correct me
- dzonga 7mo ago>> Oracle is the only one using debt to build the data center Stargate is backed by the US gvt hence why they're comfortable to put that under debt financing
- hyperbovine 7mo agoLearn from the best!
- maxdo 7mo agoThe missing part is that current gpus are already money making machine in 2026 , and you need just to serve that . I’m sure this is a procurement take between nvidia and such a big vendor as oracle
- paxys 7mo ago> The missing part is that current gpus are already money making machine in 2026 Are they? Unless you are Nvidia that is very far from the case. OpenAI's current revenue is $25 billion a year. They are expected to spend $600 billion on infrastructure in the next 4 years to sustain and grow that revenue. Amazon, Google, Microsoft and Meta are spending a combined $650 billion on infrastructure in 2026 alone. The story is the same across the rest of the industry. None of these investments are immediately profitable. And it remains to be seen whether they eventually will be or not.
- maxdo 7mo agoAnthropic in 2026 only added several billions of revenue. This is insanely fast. In my company llm cost are already eating hiring budgets to a certain extent. We don’t buy gpu. We are paying to those who will.
- maxdo 7mo ago25 bln from just one company . There will be 6-7 companies like this . And they just scratched the surface . The penetration in many areas is almost 0. Yet.
- TurdF3rguson 7mo ago> None of these investments are immediately profitable. If you're OpenAI spending $100M on a training run they're not. But if you're Oracle renting out GPUs to little guys doing inference, they are.
- sega_sai 7mo agoWow, I just saw in the article that NVIDIA called a new chip Vera Rubin (https://en.wikipedia.org/wiki/Vera_Rubin https://en.wikipedia.org/wiki/Vera_Rubin, also https://en.wikipedia.org/wiki/Vera_C._Rubin_Observatory https://en.wikipedia.org/wiki/Vera_C._Rubin_Observatory). How is it allowed for a commercial company to assign a name of a known person to a product ?
- consz 7mo agodifferent vera rubin, common mistake
- semiquaver 7mo ago...why wouldn’t that be “allowed”?
- sega_sai 7mo agoWould you want the commercial company use your name, or the name of your relative?
- semiquaver 7mo agoSure, why not? Especially if it’s honoring my contribution to science.
- CamouflagedKiwi 7mo ago
- reissbaker 7mo agoI run a small open source LLM inference company, Synthetic.new. As far as I can tell, CNBC isn't reporting this accurately: the problem isn't that Oracle is building "yesterday's data centers": they're building Blackwell DCs! Those are today's DCs. The problem appears to be that Oracle is building today's DCs... Tomorrow. And by the time they come online, Vera Rubins will be out, with 5x efficiency gains. And Oracle is unlikely to want to drop the price of Blackwells 5x, despite them being 5x less efficient. It's a little unclear to me how bad this is. Nvidia's "rack scale" machines like GB200-NVL72s and GB300-NVL72s are basically a fully built rack you roll into a DC and plug into power and network. In that case, Oracle should probably just buy the rack-scale Vera Rubins when they come out instead of Blackwells and roll them into their new DCs. Tada! Tomorrow's DCs, tomorrow. OTOH it's possible someone at Oracle screwed up and committed to buying Blackwells at today's prices, delivered tomorrow. Or maybe construction of the physical DCs is behind schedule, so today's Blackwells are sitting around unused, waiting for power and networking tomorrow. Then they're in a bit of trouble. Regardless, CNBC's reporting seems pretty unclear on what actually happened and whether this is actually bad or not.
- zedlasso 7mo agothey are saying what you are saying. At least Deirde Bosa did. I think there is a lot of folks internally who don't understand the gravity of it and keep questioning it. You are right about the building of today's DC's. There is a small part of me that feels Oracle might be a bit toxic long term with all this debt him and his kid have taken on. And this could be the first reaction to it.
- reactordev 7mo agoBut this is exactly why Oracle is the wrong partner. They don’t get it. They never will. To them, it’s just a “workload”.
- devonkelley 7mo ago[flagged]
- mgilroy 7mo agoI think the more interesting question is how much longer does oracle have and at what point does a hostile takeover make sense. Their databases are heavily used in government, banking and other large industries which have been slower to adapt to change and strugglyto migrate away. At what point does purchasing oracle to gain customer share, existing data centres and the opportunity to migrate to your cloud platform make more sense than competing? They still have a high market value. However, the debt they will need to service will result in ongoing price increases which will encourage people to migrate away. Over time they will struggle to service the debt and a buyout will be the best of the bad options.
- cogman10 7mo agoI mean, it's still pretty unclear to me how IBM continues to operate. They run like Oracle but with 20 year old tech.
- esseph 7mo agoThey're one ~ 3 main companies in the US that will sell you quantum computers, and the only one offering a quantum PaaS. They do a lot of stuff. Also own Hashicorp now, so they have things like: Ansible / RedHat Linux (already owned), Terraform, Consul, Nomad, Packer, etc. A lot of "let's build modern infra" tooling.
- smj-edison 7mo agoiirc they still do a lot of chip research and fabrication equipment. They were able to keep that side of the business going at least.
- evilduck 7mo agoMainframes aren't going anywhere.
- stogot 7mo agoThey are, but slowly
- 7mo ago
- yibg 7mo agoNot directly related to the article itself, but aren't all debt by definition tomorrow's debt? i.e. debt is money to be paid off in the future.
- cavisne 7mo agoThis feels a bit overdone. OpenAI has had problems with every compute partner they've ever had. It's just not a solvable problem, who would they go to to allegedly get next-gen chips quicker?
- tflinton 7mo ago[flagged]
- thefounder 7mo agoWhy would you buy the old gen GPUs instead to commit to buy the newest and best GPU available in 2 years? anyone knows that electronics depreciate fast. Unless they get them at discount this is really stupid. It’s like buying the best TV or iPhone at full price and keep it in storage for 2+ years.
- ed_elliott_asc 7mo agoI don’t understand the content of most of the comments here - am I being thick?
- __0x01 7mo agoCan a datacenter practicably upgrade to the next generation of GPU every year?
- lflckfnbs 7mo agoIf it wants to stay competitive, yes.
- A7OM 7mo ago[flagged]
- nacozarina 7mo agothe winners of the railroad boom were the buyers of distressed assets, not the dreamers that built them