Microsoft decided against renewing a deal to rent Oracle computing power for Bing and has spent recent months shutting off the rented capacity, Bloomberg reported Nov. 6. People familiar with the deal told Bloomberg that the machines used older Nvidia chips and no longer met Microsoft’s requirements. Bloomberg could not determine the size of the agreement. Microsoft declined to comment to Bloomberg.
When Oracle announced the multiyear deal in November 2023, Microsoft was using Oracle’s servers alongside its own Azure cloud to run AI models for Bing’s conversational search. Running a trained model to answer a question is one example of inference. Oracle did not disclose financial terms.
An Oracle spokesperson told Reuters that demand for its AI computing remained strong, including for older chips. In September, Oracle said it had renewed or resold chip capacity that came up for renewal in its first fiscal quarter at prices 20% above the prior contracts. Most of those chips were at least four years old. Oracle gave no price for the Bing deal.
On Oct. 28, Microsoft’s finance chief said demand for Azure still exceeded supply and some deliveries of rented chip capacity had slipped. Bloomberg did not report where Microsoft would run the Bing work after the rental ends.
