Oracle abandons $7 billion chip leasing agreement with Tencent
Oracle has called off a $7 billion agreement to lease computer chips to Tencent, a Chinese technology company, following objections from the Trump administration, according to a report.
The arrangement, spearheaded by Oracle and its chairman Larry Ellison, would have granted Tencent access to as many as 100,000 artificial intelligence chips housed in Asian data centers, spanning a five-year period.
Typically, US export restrictions would prevent Tencent from obtaining these advanced chips.
Officials within the Trump administration expressed concerns about the deal, which emerged amidst heightened competition between the United States and China in the field of artificial intelligence. The Financial Times reported that the arrangement was ultimately canceled, citing two individuals familiar with the situation.
Additionally, Chinese government officials reportedly encouraged Tencent to utilize domestically produced computer chips instead of those from Western companies, the report stated.
Requests for comment from representatives of Oracle, Tencent, and the White House have not been answered.
Oracle maintains significant connections with ByteDance, a China-based company. The California-based firm participated in the investment group that acquired a majority stake in TikTok’s US operations last year, under a deal facilitated by the White House. Ellison is a prominent supporter of Donald Trump.
US export regulations restrict the sale of cutting-edge AI chips from Nvidia to Chinese businesses, prompting companies like Tencent to explore leasing chip capacity from international data centers.
Source
“Oracle nixes $7B chip leasing deal with China's Tencent after Trump admin pushback: report”
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