SAfm, Thursday evening

You are listening to Jimmy Muyaha on SAFM. Now, one of those cloud companies that you heard Gary Boyson mention a little earlier on that is very deeply involved in the AI trade and AI conversation is in the US, is a company called Oracle. They recently announced that they would be abandoning a $7 billion transaction with Tencent that sits in Hong Kong around AI.

Explore this in a bit more detail with our resident economist for tech conversations, business days, Mudiwa Kawaza. Jones on the line now to see what we make of this. Mudiwa, always lovely having you on the show. Always lovely catching up around these conversations. Tell us about this transaction initially: $7 billion. Yeah, so this was one of those deals that a lot of people were paying attention to even before it was officially signed. There had been speculation that some

Something like this was happening. But more than anything else, before and after the deal was sort of consummated, sort of agreed upon, the biggest thing that stuck out to people was two things. First, the quantum. $7 billion is a lot of money. And then the second piece was the five years. And basically, what it the signal that is sent to the market at the time was basically that if you

Want to be a serious player, especially an Asian player, a Chinese player, this is the type of commitment that you need to make to actually then have the computing power for you to compete effectively in the world of AI. Modiwa, what does this abandonment of the transaction mean for both companies? I mean, from an Oracle perspective, they are a very different business to what a Tencent might do. What are the implications of this transaction?

Action not moving forward for these companies, but also for the broader AI space? So, all of this stuff is located within the context of a very complex geopolitical arena, maze, landscape, whatever word we want to use inside there. It's quite fraught at the moment. And I think if I, you know, to answer your question directly around Oracle specifically, what I'm wondering about is what type

Of precedent, this is going to set for a cloud provider like an Oracle and others because they had actually been benefiting quite a bit over the last couple of years because of some of the restrictions on Chinese players. The Chinese players had started coming up with some of these leasing agreements, as agreements rather, as a way to get around some of the sanctions imposed on them when it comes to.