[HN Gopher] Oracle is building yesterday's data centers with tom...
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Oracle is building yesterday's data centers with tomorrow's debt
Author : spenvo
Score : 116 points
Date : 2026-03-09 20:36 UTC (2 hours ago)
(HTM) web link (www.cnbc.com)
(TXT) w3m dump (www.cnbc.com)
| motbus3 wrote:
| Omg. Oracle taking greedy bad decisions with tax payer money? No
| way!
| coliveira wrote:
| While Trump is in power, the bail out is a sure thing.
| happyopossum wrote:
| TFA says nothing about taxpayer money - this is about Oracle
| taking on debt...
| keeganpoppen wrote:
| what taxpayer money?
| slopinthebag wrote:
| The inevitable bailout.
| jmclnx wrote:
| to me, seems the page is gone. This could be a related item:
|
| https://www.msn.com/en-us/money/general/as-oracle-plans-thou...
| sowbug wrote:
| What 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 wrote:
| You 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 wrote:
| It seems like GPUs with a high utilization rate (60%+) degrade
| after 1-3 years: https://www.tomshardware.com/pc-
| components/gpus/datacenter-g...
|
| Would be interested to know if others have takes on this.
| MisterTea wrote:
| It's likely the GPU boards are designed for water cooled data
| center racks and might not fit in a regular PC case. It's also
| possible the PCB the GPU's are mounted to might not be standard
| PCIe cards that fit into an ATX case.
|
| I bought a used NEC SX Aurora TSUBASA (PCIe x16 board that
| looks like a GPU board) and realized it has no fans. The server
| case it is designed to fit into is pressurized by fans forcing
| air through eight cards on a special 4 + 4 slot motherboard. I
| have to stack and mount three 40mm fans on the back.
| u1hcw9nx wrote:
| They are build to physically last 5-7 years in 24/7 datacenter
| use, but they have effective lifetime just 3-4 years, then
| their value has deprecated and electricity and infrastructure
| cost dominates. Meta did a benchmark where 9% of the chips
| failed every year, 'infant mortality' is much higher in the
| first 3 months of use.
| jdiez17 wrote:
| I've written about this elsewhere but I predict there will be a
| significant secondary market for repurposing parts of
| datacenter GPUs (for example, RAM chips) by desoldering them
| and soldering them onto new PCBs that fit PC/consumer use
| cases.
| Avicebron wrote:
| I wish there to be an active market like what Gamer's Nexus
| covered in China:
|
| https://www.youtube.com/watch?v=1H3xQaf7BFI&t=1577s
|
| in the States.
| Gigachad wrote:
| It's all about the cost of labor. In the US you could not
| find someone capable of soldering BGA chips for a price
| that makes sense doing.
| paxys wrote:
| Plenty of enterprise server hardware (racks, servers, RAM,
| disks) does have an active secondhand market after 3-5 years of
| use, but I think GPUs are too specialized for it to be viable.
| I doubt anyone has the setup to run a H200 in their home rig.
|
| I also don't think companies are going to have mandatory
| replacement cycles for GPU hardware the same way they do for
| everything else, because:
|
| 1. It is an order or magnitude (or more) more expensive.
|
| 2. It isn't clear whether Moore's law will apply to the AI GPU
| space the same way it has for everything else.
|
| Unless Nvidia can launch a new chip every 2-3 years with
| massively improved performance-per-watt at a _lower_ price no
| one is going to rush to recycle the old one.
| tryauuum wrote:
| you can absolutely run e.g. datacenter-level A100 at home,
| there are adapters from the SXM to the PCIe socket. Haven't
| seen people running SXM versions of H100s this way but this
| could be due to the price factor only
| baby_souffle wrote:
| Well technically true, I would wager that the home lab is
| going to require increasingly distinct and unusual
| adaptations to retrofit the hardware to home use.
|
| New stuff is all liquid cooled by default and that's a
| paradigm shift for your average home lab.
|
| I'm less aware of exactly what's happening on the power
| side of things but I think some of the architectures are
| now moving to relatively high voltage DC throughout and
| then down converting it to low voltage right before it's
| used. So not exactly just plug-and-play with your average
| nema15 outlet.
| TacticalCoder wrote:
| > I doubt anyone has the setup to run a H200 in their home
| rig.
|
| There are PCIe versions of these right? And another comment
| is saying there are PCI adapters too. It "only" requires 600
| to 700W. It's not out of reach for everybody.
|
| If the used regular server market is any indication, you can
| find, after a few years, a _lot_ of enterprise gear at
| totally discounted prices. CPU costing $4K brand new for $100
| after a few years: stuff like that.
|
| A friend has got a 42U rack and so do some homelab'ers.
| People have been running GPU farms mining cryptocurrencies or
| doing "transcoding" (for money).
|
| It's not just CPUs at 1/40th of their brand new price:
| network gear too. And ECC RAM (before the recent RAM craze).
|
| I'm pretty sure that _if_ H200 begin to flood the used
| market, people shall quickly adapt.
|
| > Unless Nvidia can launch a new chip every 2-3 years with
| massively improved performance-per-watt at a lower price no
| one is going to rush to recycle the old one.
|
| I agree with that. But if they resell old H200s, people are
| resourceful and shall find a way to run these.
| epolanski wrote:
| > Unless Nvidia can launch a new chip every 2-3 years with
| massively improved performance-per-watt at a lower price no
| one is going to rush to recycle the old one.
|
| That's exactly the point.
|
| Performance/watt is increasing so much gen-to-gen that it
| makes no longer sense to run older hardware.
|
| Not my words, Jensen's.
| observationist wrote:
| Depending on the elemental composition, it could definitely be
| worthwhile to recycle wherever scale is practical. For giant
| datacenters and companies using hundreds of thousands or
| millions of gpus, that adds up to a lot of gold and other
| valuable elements.
|
| In order to take advantage of that, someone needs to be
| positioned to process all that material economically, and to
| make the logistics achievable by the big players. If it costs
| Facebook $10million to store and transport phased out gpus vs
| just sending them to a landfil, they're not going to do it. If
| they get $100k for recycling - probably not going to do it. If
| they pocket $5 million, they will definitely contract that out,
| especially if it costs $50 million to build out the
| infrastructure to handle it.
|
| Probably a good company idea - transport, disposal,
| refurbishment of out of cycle GPUs and datacenter assets,
| creating a massive recycling pipeline for recapturing all the
| valuable elements is a pretty good niche.
| throwup238 wrote:
| Last I checked AWS is still offering g4dn instances that run on
| NVIDIA T4 GPUs, which were first released in 2018. I think most
| people underestimate how long superscalers can keep these
| things running profitably after they depreciate, and you
| probably don't want anything they throw away.
|
| My last employer is still running a bunch of otherwise
| discontinued g3 instances with 2015 era GPUs.
| h4kunamata wrote:
| Bin!!
|
| Why would them sell it cheaper to the 2nd market??
|
| It will hurt the sales of new ones. This is the way even with
| food, let alone technology. Don't expect to buy cheaper 2nd GPU
| any century soon.
| Gigachad wrote:
| The data center owners aren't the ones selling new GPUs.
| alphager wrote:
| They are selling access to GPU computation. Seeking their
| used GPUs would flood the market with cheap competitors
| using their old GPUs.
| Gigachad wrote:
| If the GPUs were competitive with their own, they
| wouldn't be selling them off.
| mcs5280 wrote:
| The only thing that matters is stonk++
| munk-a wrote:
| The 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 wrote:
| too bad stonk is down 23% this year. i think they are doing it
| wrong
| conductr wrote:
| It'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
| chb wrote:
| Is it possible that the supply of used GPUs available to home
| builders will somehow increase as the result of this?
| llm_nerd wrote:
| Data 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.
| advisedwang wrote:
| Perhaps oracle going bust can be the silver lining to an AI
| bubble bursting
| wmf wrote:
| I 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 wrote:
| So 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 wrote:
| Something is probably happening but I don't know what it is.
| Maybe this is really a negotiation over price.
| collabs wrote:
| I 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 wrote:
| > 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 wrote:
| OpenAI is a unreliable narrator as long as Sam is in charge.
| Full stop. EM_DASH.
| hristov wrote:
| What 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 wrote:
| This 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.
| yalogin wrote:
| This 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
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