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In today’s Cloud Wars Minute, I explore the reported collaboration between Elon Musk’s AI startup and Oracle, analyzing the implications of Musk’s potential $10 billion deal for data center services and Oracle’s expanding AI data center capabilities
Highlights
00:21 — Elon Musk and Larry Ellison have done a number of things together. Now there are reports that Musk’s AI startup, x.AI, is about to give a big contract to Oracle for data centers. Elon Musk’s AI startup is going to need AI training. Oracle has been incredibly successful in winning a lot of big AI training deals.
01:26 — If we go back to Oracle’s March 11 earnings call, the analysts understandably were asking a lot of questions about Oracle’s cloud infrastructure business; specifically, they asked how it has grown so rapidly. Ellison said part of it is Oracle’s unique data center philosophy: building a large number of small, but very modern, powerful, secure data centers.
02:11 — However, given the incredible demand around AI, he also said, Oracle is simultaneously, while maintaining its current plan for lots of small data centers, also building the largest data center in the world that we know of, an AI data center in Salt Lake City.
Ask Cloud Wars AI Agent about this analysis
03:15 — Then these reports came up last week indicating Musk is going to work with Oracle on a $10 billion deal for all this, and I just wanted to connect a couple of dots here and say that if anybody is on the forefront of doing something special about an AI data center, it’s Larry Ellison. Oracle also won a big deal from Microsoft, too, for cloud infrastructure to do AI inferencing for Bing.
04:34 — Nothing is certain about this whole, speculative $10 billion deal. But if, as I said in the headline here, Elon Musk needs training for his x.AI GenAI startup, one of the sources he could look to as a possible supplier for that is Oracle. Out of Cloud Wars, the Data Center Wars could be brewing.
