Executive Summary:
Oracle Corporation, long revered for its dominance in enterprise databases and business applications, is now quietly becoming one of the most pivotal players in the artificial intelligence (AI) revolution. With bold investments, a hybrid datacenter strategy, and differentiated AI infrastructure capabilities, Oracle is delivering scalable, high-performance AI computing to both enterprises and governments around the world.
This white paper analyzes the strategic trajectory Oracle has followed to establish itself as a credible AI infrastructure powerhouse. It also details why Oracle’s AI solutions — rooted in cost-efficient infrastructure, sovereign cloud delivery, and optimized networking — offer significant long-term advantages for organizations seeking to modernize their IT and lead in the era of intelligent transformation.
1. Oracle’s Bold Transformation into an AI Infrastructure Leader
For much of the 2010s, Oracle lagged in public cloud adoption compared to hyperscalers like AWS, Microsoft Azure, and Google Cloud. But under the stewardship of Larry Ellison, Oracle pivoted aggressively — first by building OCI Gen2, and now by placing high-risk, high-reward bets on GPU datacenter capacity across the globe. As of early 2025, Oracle is the largest datacenter lessor in the U.S., with over 2GW of contracted capacity — much of it dedicated to AI workloads.
Oracle’s resurgence is being powered by:
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Massive AI-focused datacenter investments (e.g., Abilene, Texas)
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Strategic partnerships with OpenAI and ByteDance
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Rapid expansion into ASEAN and emerging regions
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Competitive Total Cost of Ownership (TCO) and networking leadership
These moves position Oracle not only as a hyperscaler alternative — but as a new breed of “Investment Grade Neocloud,” capable of delivering enterprise-grade reliability and cloud-native innovation at scale.
2. AI Infrastructure at Hyperscale: Oracle’s Global Footprint
Abilene, Texas – A Gateway to AI at Scale
Oracle’s most audacious AI infrastructure investment lies in Abilene, where it has committed to over 880MW of capacity in partnership with Crusoe, targeting high-value AI contracts — most notably with OpenAI. This site, often referred to as “Stargate,” may represent one of the largest private datacenter investments in the world.
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Risk and reward: Oracle secured 15-year GPU hosting deals — an unprecedented long-term play even before seeing return.
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Strategic upside: While the Stargate JV has no formal structure, the underlying OpenAI contracts are very real — and expected to drive multi-billion-dollar revenue growth over the coming years.
ASEAN – The Rise of a Second AI Superhub
While headlines focus on Texas, Oracle’s most underappreciated advantage is its partnership with ByteDance. Through aggressive deployment in Malaysia, Singapore, and Batam (Indonesia), Oracle now anchors the world’s second-largest AI datacenter hub outside the U.S.
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Oracle’s GPU footprint in ASEAN is massive, with over 1GW of capacity forecasted.
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DayOne (formerly GDS International) enables <12-month deployment timelines — accelerating Oracle’s go-to-market globally.
This makes Oracle the de facto AI infrastructure partner not only for U.S. tech leaders, but also for hyper-scalers in Asia.
3. Differentiated Capabilities: Oracle’s Competitive AI Stack
Networking and TCO Leadership
Oracle’s superior cost structure is a critical advantage. It leverages:
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RoCEv2 networking for high-speed, low-latency GPU communication
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Direct partnerships with Foxconn (ODM) instead of OEMs like Dell
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Investment-grade debt to lower its capital costs
This gives Oracle a 20% CapEx advantage over Neocloud competitors and helps it underprice hyperscalers while preserving margins.
ClusterMAX™ Gold Rating
Oracle’s infrastructure recently received the ClusterMAX™ Gold designation for:
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Network performance on Nvidia H100/H200
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Superior lifecycle management
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High reliability in AI workload orchestration
This makes OCI one of the few clouds ready for production-grade GenAI workloads at hyperscale.
4. Upselling and Long-Term Differentiation
Unlike traditional GPU cloud vendors, Oracle has a strong software and platform moat, enabling it to upsell:
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Oracle Cloud AI Services
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Fusion Applications with embedded AI (ERP, HCM, SCM)
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Autonomous Database + AI Vector Search
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Industry-specific GenAI accelerators (healthcare, finance, defense)
This positions Oracle not only as an infrastructure provider but as an end-to-end enterprise AI enabler — creating significant lock-in and value.
5. Use Cases for Enterprise and Government
Enterprises:
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AI-embedded ERP and Analytics: Real-time forecasting, anomaly detection, smart automation using Oracle Fusion Apps
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AI-powered customer service: Integration of large language models into Oracle Digital Assistant and Service Cloud
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Secure GenAI: Running proprietary models on Oracle’s sovereign cloud or dedicated GPU clusters
Governments:
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National AI infrastructure: Oracle’s flexible deployment models (e.g., dedicated regions) support sovereign data compliance
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AI for public sector workflows: Fraud detection, citizen engagement, logistics automation
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Defense and intelligence AI: High-assurance compute using Oracle’s secure Exadata and RoCE networks
6. Outlook: Oracle’s Roadmap for AI Leadership
While some investors question the sustainability of Oracle’s GPU business, signs point to accelerating demand and deepening customer relationships:
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>$130B contract backlog forecasted over the next 12 months (per Larry Ellison)
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OpenAI, ByteDance, and rising mid-sized firms are driving explosive GPU demand
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Networking and cost advantages make OCI difficult to match at scale
Moreover, with AI workloads growing exponentially, and Oracle’s hybrid and sovereign cloud models gaining adoption, OCI is becoming a preferred platform not only for cost, but for trust, governance, and enterprise-readiness.
Conclusion: A Strategic Partner for the Intelligent Future
Oracle has executed a bold, high-stakes reinvention — emerging as a foundational enabler of the GenAI era. From hyperscale GPU clusters in Texas to lightning-fast ASEAN deployments, its ability to deliver AI-ready infrastructure with enterprise-grade reliability is unrivaled.
For enterprises and governments seeking to future-proof their IT with intelligent automation, secure data platforms, and scalable AI compute, Oracle offers a compelling proposition: a partner with the infrastructure of a hyperscaler, the vertical expertise of a legacy vendor, and the agility of a Neocloud.
Now is the time to explore what Oracle AI can do for your organization.
About CushySky
CushySky is a trusted independent consultancy helping enterprises and public sector organizations drive business value through Oracle Cloud, AI, and data platforms. Our team has deep experience advising on Oracle’s full technology stack — including GenAI transformation, Fusion Cloud applications, OCI Infrastructure, and AI security best practices.
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