Oracle could face $7B collateral bill for Wisconsin data centre

https://www.ft.com/content/b37030b6-bda8-4ba9-8e08-e6b88687b8f5

by 1vuio0pswjnm7 • 1 day ago

125 94 1 day ago

ft.com

ChrisArchitect2• 1 day ago

S&P Global has lowered Oracle’s creditworthiness from BBB to BBB-

https://news.ycombinator.com/item?id=48909768

spamizbad• 1 day ago

One level above junk. Yikes.

mschuster91• 1 day ago

The problem with Oracle is how much utterly and directly depends on them. They still are the authoritative source on "what is Java" and stuff like SAP directly depends on Java and in many cases Oracle Database (the supported alternatives are AFAIK IBM's mainframe stuff and MS SQL, but I only ever saw Oracle whenever I had the misfortune of having to dig into SAP).

If Oracle goes down, a lot of businesses are going to be in a lot of trouble, and there will be a lot of fighting over the scraps.

cyanydeez3• 1 day ago

every stock should have the chance to go to zero if we are to have a true Free Market.

superze• 1 day ago

Instead they bail them out and let society go to zero. But socialism bad

Ekaros• 1 day ago

Fundamentally wiping out shareholders and most of bond holders bonds is a good thing. It keeps markets healthy and honest. Excuses about pensions is just excuses from gamblers.

jollyllama• 1 day ago

Damn, that's after it was already lowered last fall. I lack perspective, does that mean it's sinking like a stone?

chasd002• 1 day ago

From what I can tell, the DC buildout isn't going that well. I've been wondering about the current status of the projects because there hasn't been much in the news or here about new DC's coming online. This report summary makes the point that getting power to the datacenters with onsite generation is running into roadblocks from permitting to even finding turbines to buy. He who shouldn't be named (here) made the same point in an interview that popped up on my youtube feed while pitching the datacenters-in-spaaaace angle. Software people are getting a lesson on the difficulties of utility scale power hardware.

https://cleanview.co/reports/behind-the-meter-data-centers

/can't read the article

skywhopper• 1 day ago

The idea that we can’t get enough electrical power on earth because of supply constraints, but that we can solve that by launching the datacenters and their entire support infrastructure into space makes no sense unless you’re a huckster trying to pump up your space launch business ahead of an IPO. There’s no way we are more constrained on land-based solar+battery equipment than we would be on space-worthy solar+battery+space-cooling equipment plus sufficient launch infrastructure and resources. Meanwhile, our government is paying companies to stop building wind power and bombing sources of natural gas.

chasd002• 1 day ago

sheesh i didn't say a datacenter-in-space was a good/feasibnle idea. The point i was making is I feel that building power plants to power a datacenter is turning out to be harder than software people realize and multi-year (or worse) delays likely the result.

wmf2• 1 day ago

For whatever reason, nobody is trying to build solar-powered AI datacenters. Maybe they can't find enough land.

ww5203• 1 day ago

Space DC make sense when local governments and communities don't want DC built on Earth. Space DC is an engineering and finance problem, not a problem in legal/permission, real estate, power generation, grid delivery, environmental, etc.

mike_hearn6• 1 day ago

On Earth it has to be fossil fuels. With solar you can't do it. I haven't done the calculations myself so, full disclosure, AI work ahead. But I asked GPT 5.6 how big a solar and battery farm would have to be to power a one gigawatt datacenter such that it could ride out a few cloudy days in a row (this is far below the reliability bar).

Its answer is you'd need an "absurdly large battery" and a solar farm of over 100 square kilometers, quite possibly up to over 200 square kilometers. And it would need to be built in the desert.

Also, normal utility scale LiON battery sites are only meant to provide stabilization services for hours, not days.

The problem is you have to overspec the solar farm quite a lot because it must not only be able to power a one gigawatt facility, but also generate more than that so it can recharge the battery packs during the day too.

So this just doesn't work. You think datacenter permitting is bad when it only requires some on-site gas turbines? Imagine the difficulty of getting a 200 square kilometer solar farm over the finishing line.

No, it's quite possible Elon is going to win this one. Regulation is expensive! He can just fire a constant stream of satellites into space. The constellation needed to provide a gigawatt of inferencing would be about the same size as today's Starlink system, well within the bounds of what he's proven can be done.

The threat to space based datacenters isn't really the physics of it. It's the risk of a bubble pop that temporarily craters demand and/or an overbuild of terrestrial capacity. Outside of the software industry we don't see huge new blocks of inferencing demand, and OpenAI at least doesn't seem capacity constrained at all right now.

bespokedevelopr• 1 day ago

If Oracle can't acquire power generation for their WI facilities they've been asleep. Generac is based out of WI and rapidly expanding their manufacturing footprint to match DC demand. Connect the dots to political lobbying and tax breaks to one of the biggest local businesses in an now-recovering manufacturing state to secure generation equipment. A year ago Oracle could've bought Generac outright for less than some of these flailing partnerships they've done.

datakan2• 1 day ago

Power generation is never the problem. Power transmission is.

superkuh• 1 day ago

Why submit links to pages that have absolutely no information on them? ft.com is useless and does not display articles. It should probably be on a banlist for HN.

Grombobulous• 1 day ago

There’s an archive link in the comments, so it’s readable.

VonGuard• 1 day ago

Oracle cannot possibly be expecting to meet its bets here. My own empirical one-person observation is that my friend worked there in the group that went around the world standing up their new cloud datacenters, and he was there from basically 2019 to earlier this year. They laid him and half his team off earlier this year. Absolutely nonsensical if they're really building out cloud data centers. Because that's exactly what his job was for the previous 5 years....

Can anyone make that make sense? The team was like 15 people and is now 7. Not exactly a large enough team to build out billions of dollars worth of data centers... Maybe they're just going to contract that all out, but this guy and his team were a very smooth, very well greased machine for standing this stuff up quickly and reliably.

throwaway26721• 1 day ago

Because that's exactly what his job was for the previous 5 years...

Or possibly senior leadership isn’t happy with the pace of DC buildout over the last 5-years.

roryirvine2• 1 day ago

Very unlikely to be the technical build team at fault for that.

Real estate, legal, permitting, utility connections, construction, plant fit out, testing and certification, security, customs and immigration, and shipping all need to happen first - and every one of those has room for huge amounts of uncertainty and delay, more so if you're doing it internationally.

There aren't many shortcuts that you can take when you're dealing with a complex combination of hardware, property, and law.

27183• 1 day ago

From my limited second-hand understanding of orcl, a team that operates in a smooth and well greased manner is quite the anomaly. I could see why the company would have an immune response to it.

peterbell_nyc• 1 day ago

LOL - too competent for their own good :(

rwmj• 1 day ago

I have to imagine that their legal team is a smooth, well oiled machine. The technical side on the other hand ...

pharrington• 1 day ago

Perhaps Larry Ellison is a bad man?

bogwog• 1 day ago

Don't anthropomorphize Larry Ellison.

jhickok• 1 day ago

Not bad, just a lawnmower.

ponector• 24 hours ago

They said with AI nowadays less people can do more, be more productive than ever!

JSR_FDED• 1 day ago

Couldn’t happen to a nicer company

Zigurd2• 1 day ago

Interviewed there early in my career. The vibe was very much off. Ran into the same vibe many years later when a company that acquired a company I founded got bought by Computer Associates. Places where doing good work and making good things seemed way down the list of priorities. I get the feeling I was pitied for naïveté.

UltraSane• 1 day ago

That is the exact vibe I got working at a state government IT department.

bravetraveler• 1 day ago

I get the feeling I was pitied for naïveté.

I have to assume so, sadly. Peers have said my preference towards quality over quantity is why I haven't "launched" [ahead of them? unclear]... as if they're nicely retired with drinks on the beach, or something. Completely blind to the fact that our priorities differ and, well, reality/status.

Long way to say, turn the performative pity right around on 'em. Their boss is a lawn mower: https://youtu.be/-zRN7XLCRhc?t=38m33s

ChrisArchitect2• 1 day ago

Five US tech giants' hidden debts soar to $1.65T on opaque AI funding

https://news.ycombinator.com/item?id=48987863

cmiles8• 1 day ago

Oracle is increasingly looking like the Lehman Brothers of the AI boom. One day it will all go pop and the cards will start crumbling elsewhere in the industry.

sudonem• 1 day ago

Except for the part where Oracle is so deeply embedded into the US government, and Larry Ellison is connected enough that they will be granted any and all bailouts necessary to prevent this (while everyone pretends not to notice that such bailouts are socialism)

Zigurd2• 1 day ago

He will for sure try. Congressional Republicans seem to be more comfortable going off the rez, tho, even before the year-end deadline for shenanigans.

overgard• 1 day ago

I imagine they'd be split up, and the essential database business would be what's actually bailed out.

le-mark• 1 day ago

Larry’s son runs paramount now, and given he’s driving it to become the next Fox News challenger, it’s a given the current admin will give them a sweet heart deal.

tecleandor• 1 day ago

And seems like he has been forcing migrations to Oracle Cloud into at least some of the daughter companies he has bought, even when they've been having way more problems. OCI needs some clients to fill data centers!

khriss• 1 day ago

Yeah, but they'll need to time their bust for before Jan next year. There is a significantly lower chance of a Democratic congress being as sympathetic.

datakan2• 1 day ago

They'll just spin some divisions off and/or sell the DC's they have to Anthropic or others at a profit. They could also just rent compute out at insane margins. They aren't going anywhere.

piguin• 1 day ago

For 50 years the idea of selling used hardware and hardware facilities at a profit was a joke. If it is not a joke again in under 10 years then the overall economics of the world are going to be the joke and it will be a very dark one.

jddj• 1 day ago

Rent compute out at insane margins is plan A.

Still, capital isn't getting any cheaper for them and their CDS are still climbing.

ece• 1 day ago

https://archive.md/voqjr

Oracle could face $7B collateral bill for Wisconsin data centre

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