How OpenAI’s Partnership With Oracle Could Alter the AI Landscape

In the age of rapid AI expansion, everyone has their eyes on the sky – or, at least on the cloud. 

Last week, Oracle and OpenAI inked a deal in which the AI model developer will purchase an eye-popping $300 billion in compute power from the cloud provider over the span of five years, beginning in 2027, according to The Wall Street Journal.

The deal marks yet another massive investment by tech giants to develop the infrastructure needed to meet lofty AI goals. For enterprises, it should be a signal that AI isn’t something that can be ignored, said Trevor Morgan, COO of OpenDrives. “When you are talking about investments to that magnitude, this is not going away.” 

In fact, if enterprises have any shot at achieving their sky-high goals, Morgan added, partnerships like these are necessary. “You can’t do it alone,” he said: 

• Deals between massive firms like OpenAI and Oracle may force smaller companies to band together to stake their claim in the industry, he added.
• For any enterprise seeking to carve out their own “bit part” in the AI industry, “you’re going to need to find the right partners.” That means identifying what your niche is and where your weaknesses lie in the market. 
• “These are partnerships that are super important to getting new technologies out to the consumers, because each one wouldn’t be able to touch the breadth without going in together,” he said. 

If partnerships on the scale of OpenAI’s withOracle, don’t stall innovation, they may still force it within the parameters set by hyperscalers. The fact of the matter is that practically no enterprise will be able to compete with the likes of these businesses. Instead, “watch what they’re doing and ride in their wake,” he said.

“If you’re going to innovate, you’re going to innovate according to the way that Oracle and OpenAI want you to,” he said. “You’re going to play in our playground? Well, then these are the rules.”  

How the massive investment will actually generate  returns, however, remains to be seen, said Morgan. He compared massive AI models to an engine: While the possibilities seem endless, figuring out how to actually drive value is still a question mark. 

“You just marvel at the amount of investment into this, and you ask ‘How are you going to recoup that?’” Morgan said.  “This is underscoring the speculative nature of AI.”