- Oracle discusses a cloud deal with Skydance Media.
- Deal worth about US$100 million a year, dependent on Skydance buying Paramount.
Oracle is in talks to sign a large software deal with Skydance Media, a move contingent on Skydance completing its planned purchase of Paramount Global.
According to Bloomberg, sources familiar with the matter say the deal would be worth about US$100 million a year. If it goes through, Paramount and its group of media companies would begin using Oracle’s cloud software to run parts of their business. The discussions are private, and the companies haven’t confirmed any details.
Skydance already uses Oracle’s products with the media company spending US$2.2 million on Oracle’s cloud services in the year ending May 2024, according to public filings. Skydance was founded by David Ellison, whose father, Larry Ellison, is Oracle’s chairman and a major shareholder. Larry Ellison is also backing Skydance’s US$8 billion bid to take over Paramount, providing cash and investment support.
None of Oracle, Skydance or Paramount responded to requests for comment.
If the merger is approved and the Oracle deal is finalised, the combined Skydance-Paramount group would become one of Oracle’s larger cloud clients. It would also deepen the existing relationship between the two companies. A person familiar with the discussions said moving Paramount’s operations to Oracle’s cloud could lead to major cost savings – possibly in the hundreds of millions – as outdated systems are replaced with newer tools.
Paramount owns a number of high-profile media brands, including CBS, MTV, and Nickelodeon. The networks generate huge amounts of video and audio data needing a lot of storage and computing power. By shifting to Oracle’s cloud, the company could centralise much of that work, making it easier to manage and potentially offering cost savings.
David Ellison has said he wants to run Paramount more efficiently if the deal goes through. A big part of that plan involves updating its technology systems. While talks with Oracle are still ongoing, the deal isn’t finalised and could still change, according to sources.
The merger between Paramount and Skydance was first announced last year but still needs approval from US regulators. The final major hurdle is the Federal Communications Commission (FCC). Last week, Ellison met with FCC chair Brendan Carr and other officials to discuss the proposal and try to move things forward.
Meanwhile, Paramount has been facing scrutiny. Earlier in July, the company reached a legal settlement in a case brought by US President Donald Trump, who accused CBS News of media bias. On Monday (Jul 21), a group of US senators sent a letter to Ellison asking whether the timing of that settlement was tied to efforts to close the merger.
Oracle has been expanding its cloud business beyond its traditional database software. The company has been picking up customers that need large-scale computing and storage, particularly those working with artificial intelligence. Oracle already counts TikTok, Uber, and Zoom among its major clients.
The cloud deal with Skydance-Paramount comes shortly after Oracle announced a new round of spending in Europe. The company said it plans to invest US$3 billion over the next five years to expand its data centre capacity in Germany and the Netherlands. Oracle has earmarked US$2 billion for Germany and US$1 billion for Dutch operations.
According to Oracle, this investment will help local companies, governments, and organisations shift their workloads to the cloud and make use of newer AI tools. The announcement didn’t tie the spending directly to the Skydance talks, but it highlights the growing demand for AI computing infrastructure.
Big names in tech – including Microsoft, Amazon, Google, Meta, OpenAI, and xAI – have also committed large amounts of money to data centres that can power AI models. Oracle is part of the US-based group, Stargate, that includes OpenAI and others. The project plans to pour hundreds of billions into new infrastructure to support AI.
Oracle’s stock rose about 1% in early trading on the day the Skydance talks were reported. Shares are up more than 37% this year and are just below their highest point to date.
