The TikTok Acquisition And Oracle’s Potential Collapse Sets Us Up For The Funniest Conclusion Possible
You probably are wondering why I didn’t talk about Oracle becoming a partial owner of the US version of TikTok, and that’s because I wanted to save the best for last.
Oracle has, for some time, been TikTok’s official US infrastructure partner. Per TechCrunch:
Oracle will serve as the trusted security partner, responsible for auditing and ensuring compliance with National Security Terms, according to a memo. The company already provides cloud services for TikTok and manages user data in the U.S. Notably, Oracle previously made a bid for TikTok back in 2020.
Here’s another great factoid about TikTok: it loses billions and billions of dollars:
TikTok’s parent, ByteDance, doesn’t disclose TikTok’s financial performance. But ByteDance investors estimate TikTok lost several billion dollars last year on revenue of roughly $20 billion.
Now that ByteDance isn’t principally responsible for the health of the app, and within a few days of the deal closing, its algorithm went to dogshit. While TikTok is attempting to claim that a power outage was to blame, anybody with even a basic knowledge of anything knows that algorithms do not live in different parts of a data center, and that the most likely reason behind the deterioration is Oracle diddling with the algorithm itself, as TechCrunch reported it would:
A White House official previously said Oracle would replicate and secure a new U.S. version of the algorithm, and the U.S.-based TikTok owners could lease the algorithm from ByteDance, which Oracle will then retrain.
So, let’s review:
Oracle has already fucked with the TikTok algorithm, the main reason people use the app, and people using the app is how the app makes money (by serving them ads).
TikTok was already losing billions of dollars.
Larry Ellison’s wealth is almost entirely tied to his shares of Oracle.
Oracle’s shares are tied to the health of the company, and said shares are already losing value because of Oracle’s egregious debt.
This situation will only improve if Oracle is able to build data centers that are behind schedule and it does not yet have the capital to build, requiring debt that bankers are hesitant to provide.
Even if successful, if OpenAI cannot pay for the compute, Oracle’s shares will slide into oblivion.
All the while, Oracle just bought into one of its largest cloud customers, and is currently in the process of making its business less-valuable.
As it stands, Oracle is a company in decline that has attached itself to a low-to-negative margin business with extensive, debt-ridden setup costs, with a primary customer that required over $140 billion in funding just to stop itself falling over and dying by the end of 2026.
Oracle continually misses analyst estimates, swindles customers into expensive contracts and then sues them to bleed them for more money, has employees that tell me that life there is utterly miserable, and is inarguably an enterprise in sharp decline, one accelerated by the desperate, egoistical predilections of Larry Ellison, a guy who allegedly stepped down a decade ago but fully intends to drive the entire company off a cliff.
If allowed to, Oracle will be swallowed whole by its debt, and won’t have much of a business to fall back upon.
In writing this piece, I have tried to look for something resembling an Oracle fan - somebody that appreciates the software or will defend it on any level.
All I can find are the most wretched AI boosters, desperate to kiss up to anybody who will incinerate billions of dollars to build dat…
Perhaps I’m trashed off hopium, but I see no scenario that ends with anything other than the near-destruction of Oracle, and even if a government bailout exists, it will take decades - if it’s even possible - to recover from what I believe will be an historic destruction of shareholder capital, all borne of the hubris of one of the most nakedly anti-consumer companies in the history of capitalism.
I hate Oracle. I’ve spent hours and hours reading about Oracle, learning all about Oracle, thinking about Oracle, philosophizing about Oracle, and never before have I witnessed a company that’s so thoroughly debased its products, customers and shareholders.
This company has taken the piss for decades, and I think it’s finally its time for a reckoning.
Could Larry Ellison be rendered penniless? Doubtful. But the outcome of decades of fucking over customers and terrible financial decisions may finally tear down his rotten legacy.
Tomorrow's Premium: The 15k word Hater's Guide To Oracle, an evil company that needs $150bn in the next 2 years and for OpenAI to become the most successful company in history or it will run out of money by 2030.
Here's $10 off annual.
edzitronswheresyouredatghostio.outpost.pub/public/promo...