Finding out that Oracle has a bond rating of BBB- [1] (one step above junk bonds) feels very appropriate for such a company with such a sordid history.

[1] https://www.spglobal.com/ratings/en/regulatory/article/-/vie...

Still too high of a rating.

'Force Majeure' is a good way to describe their incompetence.

Right, Oracle is at the bottom of the heap (they borrowed the most with the least initial credibility— who the fuck seriously thinks Oracle was ever going to be a major player in AI), so weakness in the market will appear with them first. But I think it will bubble its way up.

Will be interesting to see what excuses these companies will come up with to justify stopping investment in AI without spelling it out. The first one was already announced: it's going to kill everyone so we need to proceed more slowly.

Interesting. I had been interpreting "it's too dangerous; make us slow down" as hype to get more investment and/or customers. "We don't have the money to build out" is an interesting alternate interpretation.

The number of datacenters needing to come online doesn't add up to me. It's suspicious

When our spot instances go away and don't come back, that's a sign that there's not enough capacity.

There is more demand for compute than there is supply, and that demand is going up.

Look at all of the things that have been and are being automated and realize that we're year 6 into a hundred year journey.

Look around you at all the things that aren't automated. They will be.

The world you grew up in won't be here for much longer. We're going through a transformation even more dramatic than the industrial revolution. There were no airplanes and then we landed on the moon.

Edit: downvotes as expected, but I'm shocked that a bunch of smart people at HN aren't taking the bet where this leads to a complete upending of the status quo. The holdout crowd needs to dream bigger.

The models are solving Millennium Prize problems, finding novel biological pathways our scientists can't see, putting every single software engineer out of the job of "coding by hand", and doing the same to designers, marketers, filmmakers, and 3D artists who used to have to operate pixel by pixel / photon by photon.

Everything is going to be AI soon.

I'm shocked that a bunch of smart people at HN aren't taking the bet where this leads to a complete upending of the status quo.

If your take on the abilities of AI is correct, we aren't talking about upending the status quo, we're talking about an ELE for the human race.

There's a huge gap between what's being described in that comment and an "extinction level event" is that's what ELE means.

What's being talked about is a massive extension of human capability, into the intellectual sphere rather than the physical environment. The atom bomb had a clear way to get to extinction, a sudden chain reaction that leads to collapse of the entire biome.

The only way AI gets there is something like control of the nuclear weapons on all sides and that control becoming suicidal. Every other major event leads to at most civilization collapse, after which I assume we will have some sort of Butlerian Jihad restrictions on getting into the same situation.

But, I would love to know what I'm missing here, if ELE has clearer routes!!

That's the usual bait and switch though. Very few people are saying AI the statistical software is going away. What people are dubious of is the commercialisation model of building a butt ton of data centres to serve massive general models by two heavily subsidised VC companies even as industry gets more mature and fickle as they get their heads around using it to solve problems and it goes onto Opex budgets. I think this is more like the early days of cloud which finished in "software built around clouds" rather than "everyone spins up their own fleet of servers for everything"

How so? It's clear the hyperscalers can't keep up with demand.

Is it clear they need anything like the unbuilt capacity that is in the pipeline?

They are using tiny fractions of the data centres they claim to have "built".

There's a significant risk of a Chinese real-estate bubble here.

What source do you have for "using tiny fractions of the data centres"?

The money doesn't seem to back this up. Why would Anthropic pay through the nose and make such desperate moves for compute?

Why would Anthropic pay through the nose and make such desperate moves for compute?

That's pretty consistent with them having not been able to get the physical data centre capacity they have supposedly had built actually online, I think?

More to the point, Anthropic appears to mostly be capable of serving its customers, doesn't it? It's not so resource-starved that people aren't able to use it at all.

So what does it tell you that only 300 megawatts was enough to make a very meaningful difference to that?

If Anthropic's fortunes can be meaningfully changed by only 300MW which allowed them to uncap their customers, what is the case — even including OpenAI and Google -- for the demand for the 23GW of unbuilt AI data centre build commitments out there?

If there's that much demand, how did 300MW have such a radical impact on such a popular, widely used product?

Satya Nadella himself said there will be some oversupply.

What if there is actually lots of oversupply?

My instinct is that the internet/software/IT industry sees its own demand for Anthropic and OpenAI and is misleading itself into thinking that this is representative of the demand in the rest of the industry, when what possible other human industry tasks are there that match the compute demands of writing software?

Another way to look at it: if the general demand for AI compute is so insatiable, how in this world of existing insatiable demand did xAI have spare capacity to lease? Why does Meta have spare capacity to lease?

The issue here is very evidently one of allocation. But allocation tends to get solved over time. That could leave quite a lot of very big data centres relatively empty.

Reuters has a non-paywalled (short) report with a bit of detail:

https://www.reuters.com/business/oracle-cites-force-majeure-...

Everyone is interpreting this as a sign the bubble is bursting, when the actual story is costs for materials and labor are going up and delays are happening because so many data centers are getting built.

If Oracle was able to build the data center under-cost and faster than expected, that would be a better sign the bubble was bursting!

Right, so the presumably the revenue projections aren't increasing at the same pace and the financials don't make sense anymore. Which is potentially a sign of the bubble bursting.

I mean the literal guidance is that Oracle may not make money on the datacenter by 2028 because they won't be able to turn it on.

How profitable a datacenter is, is kind of irrelevant to the convo, if you are unable to power it due to material shortages.

Doesn't 'Force Majeure' mean exceptional events outside ones control? Pretty sure everything involved here is Oracles own making lol

"No one could have predicted that permits and infrastructure necessary for this project's completion would be delayed". Except for every project that's needed permits and infrastructure ever.

I hope whoever buys Oracle fires Larry by email.

I hope whoever buys Oracle fires Larry by email.

I certainly hope not; you can't fire[1] someone via email.

============================

[1] Out of a canon. Into the sun.

"Well a wave hit it"

Surely this will assuage the creditors that Oracle is going to pay back its $100B+ loans.

I'm surprised to hear that solid-oxide fuel cells are apparently a non-gimmick thing now.

"Oracle signed a deal with solid oxide fuel cell (SOFC) developer Bloom last year for 1.8GW of power, expanding it to 2.8GW of capacity in April."

https://www.datacenterdynamics.com/en/news/new-mexico-regula...

Apparently this one would have been the largest SOFC installation, by far.

I really don't get who keeps using Oracle outside of Java, and how they make their money, must be some legacy contracts or something, but Oracle has always been customer hostile, from all the things I've heard, they sound like a ransomware company (idk if they still do it, but they'd sell you the database, then "audit you" and if you used anything that wasn't in compliance, fine you, until you converted that to Oracle DB too or whatever wild stuff). I just don't get it. I get even less how its execs are okay running what could be a much more successful company so poorly. You can change Oracle for the better and become even more profitable if you change how you do business.

Take Java as a solid example, they removed JavaFX from the core of Java, which made everyone think JavaFX was dead, recently they started providing enterprise support for JavaFX, which signals its production ready, but, who wants to trust Oracle? I sure don't. I can use C# for free without any of that baggage, and if I get all sorts of stable options for a GUI, and with Avalonia (and Uno?) I can run my GUI on any OS.

they removed JavaFX from the core of Java

You can still use OpenJFX with OpenJDK, can't you?

I really don't get who keeps using Oracle

"Enterprise" is still very much in the camp of "using Oracle". Which is likely how they survive despite being so customer unfriendly. "Enterprise" users are simply using what "the enterprise" purchased and have little choice in the matter.

Is there a list somewhere of major "enterprises" in this position? I've always kinda wondered how Java keeps its edge over C# in the TIOBE rankings.

TIOBE rankings are meaningless.

What do you suggest instead, then?

My company uses Oracle BRM to bill for millions of phone calls each month. It would be such a crazy upheaval project to move from that.

Millions per month is tens per minute. That doesn't seem like all that much to me?

You don't have experience from corporate environment. Oracle is very much present, alive and kicking there, in 1000 and 1 little or big applications, sometimes even out of convenience and cost (is you have just 1 DBA team supporting oracle, adding even 1 postgres to production system could be a cost nightmare to support and manage.

And SQL DBs are not going anywhere in next few decades.

I realize there’s a lot of hate in this thread, but I think there’s another side to this.

Force majeure is basically there for situations where something outside a company’s control prevents them from delivering on a contract.

I can see Oracle’s argument here. A number of states and local governments that were originally very supportive of new data centers, including places like Texas and Pennsylvania, have since started blocking or restricting new construction.

If Oracle signed these contracts and the government later changed the rules and have stopped those projects from moving forward, it’s hard to argue they should still be held to the same delivery commitments.

(That seems pretty close to the type of situation force majeure is meant for.)

In that case, would the people caught unemployed and with upside down loans in the 2008 financial crisis would have a reasonable argument for "force majeure" to cancel their mortgages? ... After all, they had a reasonable expectation that the economy would continue to support their employment, either with their current employer or by finding a new job that paid just as well?

at some point the phrases loses its meaning if it becomes applicable to pretty much anything.

In your example, governments we not enacting new regulation that banned you from getting a job.

In this situation, governments are now enacting new regulation that ban companies like Oracle from building data centers.

A reasonably-written contract would have weasel words in it - something like "subject to zoning approval, and approval of the needed power and water and etcetera". Oracle has very expensive lawyers; they should have had those clauses in there.

Still, you write those for the known possible obstacles. Having the state government change the ground rules may not have been one of your known possibles. So, yeah, I could see force majeure being at least possibly reasonable.