We Need More Power - DTNS 5138

0:03This is the Daily Tech News for Monday, November 3rd, 2025. We tell you what you need to know, we follow up on context, and we help each other understand. Today, everybody wants more infrastructure, but what they really need is more power. Where will they get it, Tom? Where will they get the power? I'm Tom Merritt. And I'm Rob Dunwoody. Let's start with what you need to know with that powerful story. Now that OpenAI and Microsoft have opened up their relationship, there's no more exclusive for cloud services between them. The race is on for companies to secure the computing resources they need to drive innovation and meet demand for all those generative model users that are coming on in.

0:45So let's run down the deals that were just made. First, OpenAI struck its first deal with AWS. Now, they had struck preliminary deals before they got the open permission from Microsoft, but they had not done one with AWS. So this seven-year deal is about 10 % the size of those previous deals. It's a smaller one, relatively speaking, but it's the opening of a relationship. OpenAI has made bigger deals with Oracle and made a bigger deal with Microsoft. They're not ditching Microsoft. For the Amazon deal, OpenAI will use NVIDIA GPUs, but there is the possibility of adding Amazon's in-house Tranium CPUs to the deal as well.

1:25And the workloads will start running on AWS immediately, but of course continue to expand as Amazon adds capacity. Microsoft has two deals to talk about they'll spend 7.9 billion dollars in the United Arab Emirates that's where Abu Dhabi is uh over the next four years to build out data centers there Microsoft says it got a U.S. license uh to ship NVIDIA chips there for this purpose uh that is a restricted area but they got a license to ease that restriction for them so they'll be able to sell not only all the NVIDIA advanced stuff, but the Blackwell chips, the GB300s. Microsoft said it will triple its use of NVIDIA chips in this country.

2:08This comes along with remarks from the U.S. president that the country's most advanced chips will be reserved for U.S. companies, but Microsoft's a U.S. company. They're just building something somewhere else. Microsoft also reached a deal with Australia's former crypto miner turned AI resource provider, IREN. That's I-R-E-N. they'll be able to access NVIDIA's GB300 chips as well to put in data centers in Childress, Texas. It's out in West Texas. IREN will contract with Dell to provide further equipment as it expands operations to meet the deal. So Microsoft building the stuff in and around Abu Dhabi and getting IREN to build stuff for it in Texas.

2:46This will, of course, add to the conversations about excess compute. Are companies building too much? Are we going to get all the use out of this, that all of this money and time spent building is hoping they will get? In an appearance on Brad Gerstner's YouTube podcast, both Microsoft CEO Satya Nadella and OpenAI CEO Sam Altman, who appeared together, by the way, to show that there's, you know, no bad blood between them. They said power, not compute, is the problem. They're not worried about the users. The users are going to be there. Will they be able to have enough power? Nadella said, In fact, that is my problem today, right?

3:23It's not a supply issue of chips. It's actually the fact that I don't have warm shells to plug into. Now, by warm shells, he does not mean pasta. He means data centers with power that are ready to install the servers in, right? It's a shell of a data center. And warm means it's got power. Along with building more power resources, there's also making the compute more efficient. Altman said, Someday we will make an incredible consumer device that can run a GPT-5 or GPT-6 capable model completely locally at a low power draw. So it's worth noting that Meta signed three deals this week for power. A total of one gigawatts worth of solar power, two in Louisiana, one near Lubbock, Texas, also in West Texas.

4:08And South Korea will mandate that all parking lots, including existing ones, not just new construction, with more than 80 spaces must add solar canopies that will not only protect your car, but it will also generate energy. So, Rob, let's talk about the energy use of this all. it does appear that most of the time when you hear about a deal for power for data centers it is a renewable resource and the word on the street is that buying wind and solar is actually cost competitive when you're talking about the other existing power resources out there yeah so power apparently is a is a big deal here a really really big deal here and and i'm thinking to the deal between Microsoft and OpenAI.

4:57One of the things that is kind of interesting is that, yeah, we're not necessarily cool, but it's okay. You go do your thing and get compute from other places. And it's looking like, well, because Microsoft may not be able to supply everything that OpenAI needs. It looks like OpenAI is growing. They're growing immensely fast. They're getting bigger and bigger and bigger. Microsoft is too, but I don't know at the same clip. So does it make sense for OpenAI to go and use these other things when Microsoft is still getting, you know, clearly close to 30 percent of what OpenAI makes? It's probably not a bad deal for both companies.

5:33Yeah, exactly. It diversifies the resources for OpenAI. They're not reliant on one company. Not that Microsoft's going anywhere anytime soon. Right. But, you know, it's just always good to have lots of different resources. That's why I think that AWS deal is significant, even though it's smaller, is that it's something they can build on. And if they start to find out, wait, AWS works really well for us, they can expand that deal fast. But again, I think there's a lot of concern. In fact, I saw it on our subreddit where people are saying, how are you going to power all this? There's the assumption that it's going to be polluting resources.

6:09It doesn't have to be. I know it's a lot of the times easier for it to be. but we shouldn't discount the scenario that what this does is drives down the price of renewable resources. One of the problems with the price of renewable resources was you just didn't have enough people wanting to get into buying it. The demand wasn't there. It was one of those chicken and egg problems. Well, now you got the demand and you're seeing companies like Meta saying, yeah, we'll sign three deals in a week for a gigawatt of solar. That might actually start to drive innovation and drive down the cost. And you very possibly could get a situation where renewable resources take off because of this.

6:52This makes sense. And one of the reasons why these big data centers are interested in renewables, outside of the fact that it's better for the planet and they're playing the long game, it's like we would like to actually have power where water won't be eventually because of global warming. There's that part of it. But the other part of it is that we have a very, very antiquated and old grid in this country. So it's oftentimes just easier to build the, you know, to build the data center near where the renewable power is. So like wind, solar, they tend to be in big wide spaces, a lot of open land, you can build ginormous buildings and put computers in there, not necessarily next to the coal plant that has been there for 70, 80, 100 years.

7:37Yeah. And interestingly, you'd think of West Texas as that kind of place, right? If I understand this right, though, the Louisiana deals, the power from the solar grids is going to go straight to the data centers, but in the Texas deal, it goes into the grid, and then the data centers are just pulling it out of the grid. It's one of those situations. So they're putting in as much as they're pulling out in that case, at least theoretically, according to the deal, right? But they're not drawing it directly from the solar panels when you think that that would be the place they would. All that said, you're right.

8:12These companies like the press hit of saying, hey, we're doing a renewable thing, but they are doing it more often because it is cheaper and it is flexible. Deep Dennis is made possible by you, the listener. Thanks to Johnny Hernandez, High Tech Oki, and Chris Zaragoza.

8:34there's more we need to know today let's get to the briefs every sunday mark german posts his power on newsletter on bloomberg generating that week's reliable apple leaks a lot of it this week is about apple celebrating its 50th anniversary on april 1st however the remark getting the most attention is apple is betting heavily on the new siri which will lean on google's gemini model and introduced features like AI-powered web search. Gurman has reported on this before, but repeated that while Anthropic offered a better model, Apple chose Google because of the price. He also repeated that Gemini-based custom model will run on Apple's private cloud server.

9:10So I'm wondering here, is this deal between Google and Apple, is this the Google search deal 2.0 for those two companies? Yeah, it does feel like that, right? It makes sense for Google to say like, hey, you know, that search deal is going to get less and less important for both of us. And we don't want you to ditch us for somebody else. So let's provide Gemini. That can power your search eventually and power Siri as well. I have to say Gemini is very good. It has improved tremendously. I lean on it quite a bit and I find it to be on par anyway. None of these models are perfect. They all have their quirks and their weaknesses.

9:53but it's decent. And I think this is where my head was at, Rob, is that Apple is going to need to buy while it builds, which it does all the time. It used to buy cloud services. It used to buy maps. It's been a buyer of services a lot. It's always bought search, even though it is toyed with the idea of creating search. And it can do both well. It can build things like chips and eventually use those, or it can just buy things like search and integrate them in a way that's seamless. The other interesting thing is that this will run in Apple data centers. It's not just running on Google stuff. They're actually going to put this model inside of Apple's data center and run on their hardware, which is probably going to mean a lot for security for Apple.

10:40I know they're very, very security conscious, probably the most out of the two big phone manufacturing operating systems. But that's a good thing for Apple. If this continues to be the case, with Gurman's stuff, I always believe that he's right now. It doesn't mean that they will continue to do that. They could change their mind between now and next year. But assuming this continues to be the case, it'll be an interesting marketing challenge for Apple to acknowledge that they have a very good model powering Siri without sounding like Google is going to get all your information, right? I mean, from what it says, it's going to be on Apple servers.

11:14It's going to be a customized model. It's going to be able to look into your device for you, but keep it private. But if people hear Google in this, if they hear Gemini and think Google, it doesn't matter what Apple says. They're going to think, oh, you're sharing my data with Google. Absolutely. I think perception is they're just trying to make sure, hey, this is on our stuff. Settle down. Yeah, yeah. The U.S. published a fact sheet on its new trade agreements with China that says China will ease its export restrictions on chips needed to produce cars. This is particularly good news for Nexperia, which moves its chips between the Netherlands and China and was at risk of having production disrupted because the Chinese arm was holding up the chips because of these restrictions.

11:59The fact sheet also specifically mentioned the resumption of trade from Nexperia facilities, and says China will pause export controls on rare earth minerals. That doesn't mean pausing export, that means pausing the controls, which means they will now resume allowing folks to export rare earth minerals, which is good for production across the globe. And then there was this.

12:29How do you see the security? Very good. Let's see if there's a back door. We'll see if there's a phone. China's President Xi Jinping presented South Korean President Yi Jae-myung a pair of Xiaomi smartphones. President Myung joked, is the line secure? And then President Xi, not knowing for being a jokester, replied, you can check if there's a back door. uh that's that's funny because she is very stoic he does not joke at all so the fact that he's making one here that's that's notable probably why we're talking about it was sarcastic too right i mean this is this is throwing a little shade on the united states who is always accusing china of backdoors right so uh and yeah uh i thought that was that was i don't know how meaningful it is but it's certainly notable right Right.

13:24And of course, resuming the export of rare earths is going to be a huge relief for industry around the world. And the Xperia thing was just ridiculous. Like there were two arms of the same company that couldn't send parts to each other, or at least they were afraid that was going to be the case. And now it won't be. Logitech has expanded sales of its Bluetooth Alto Keys K9 8M mechanical keyboard to include North America. It's hot swappable with standard Cherry MX compatible key switches. It comes in white, gray, and lavender with backlights that shine through transparent keycaps. It also uses an internal gasket mount for semi-soft typing.

14:00Logitech says the battery should last 12 months without the backlight on. It sells for$150. And I am a fan of keyboards. I've got a ton of them. So I want to see what this gasket on these keys is like. Because if it's quiet enough, I could use it at a podcasting desk like I am right now. Yeah, and be able to do your own customized key switches, which I know people love. It is apparently a little restricted in the options in the software compared to a lot of these hobbyist and enthusiast keyboards out there that use Cherry MX switches. But otherwise, for Logitech anyway, which makes great keyboards, it is interesting to see them getting into a more hobbyist space.

14:45I think it's a testament to how popular these kinds of keyboards are. Yeah, they're super popular. I'm actually using a Logitech MX Mechanical now. And the reason for that is because it's really quiet and I can type on it while talking into this mic. But it's just not as pretty as what this will be. So I'm just interested to test one of these things out and see, can I type and you not hear the typing in the microphone when I'm podcasting. Now, this one I think is just notable. Companies in the U.S. are going slow on generative models in filmmaking, not because the company's making the generative models want them to, but because filmmakers are very cautious.

15:21There's a lot of upset about copyright provenance, intellectual property, replacement of actors, replacement of production staff. So a joint venture in South Korea is creating infrastructure, both the data centers and the power supply, to our earlier conversation, for producing movies and TV shows with those models. So, you know, while the feet drag in the United States, you're seeing South Korea jump to the front of the line, at least they'd like to. This joint venture is between a production company called Utopai Studios, spelled U-T-O-P-A-I, and an investment firm called Stock Farm Road that happens to have the grandson of the founder of LG on it.

16:06The venture will co-produce film and TV projects and expand access to Korean intellectual property. The first production is expected to be released next year. And they say every model and every data set is fully licensed and contractually approved. It's going to be interesting to see what the industry from a U.S. standpoint looks like. Because if you look at what SOAR 2 is doing, if you look at what Google is doing with Gemini and the video that you can create, the realism that you get out of this, there's definitely cause for concern if you are an actor or around that industry. So just because we're not necessarily moving full steam ahead here in the United States doesn't mean Earth is going to adhere to that.

16:51So this is going to be very interesting to me to see how we actually go forward with AI in this space. If there is a way to do this cheaper at quality or better, it will be done. And I think that's why this story is interesting, because South Korea is a growing content powerhouse, winning Oscars, winning Grammys. Well, they haven't won a Grammy yet, but there's a lot of momentum behind South Korean TV shows and movies. And that is happening not just in Asia, but in the United States as well. And so a company that is willing to work with its domestic industry and take advantage of the momentum behind that is going to push hollywood uh it's it's going to say like hey if you're not going to do it we will uh and i think that's that's going to cause a lot of companies to look twice at stuff finally some quick headlines these are always just good to know things if you want to understand news in the future gaming handheld maker ian neo is teasing its first gaming phone called the iania phone with physical shoulder buttons.

18:01Korea's Money Today reports that its sources say Samsung is preparing to hold its Galaxy Unpacked event for the S26 in San Francisco on Wednesday, February 25th, which would be much later than its more recent January dates. If you heard that the RDNA 1 or the RDNA 2 would not get game-specific optimizations any longer, don't worry. AMD clarified that though the cards are headed into maintenance mode, they will not lose game-specific optimizations. Microsoft AI CEO Mustafa Suleiman told CNBC he thinks it's a waste of time to pursue research on whether AI models are conscious or not. In the downwing, upwing debate, he's clearly an upwinger.

18:43He thinks it's the wrong question at this point. China's Baidu reports that it's reached 250 ,000 weekly driverless rides, the same mark Waymo reached in April. EV maker BYD said sales fell 12 % on the year in October. Before you get all up in your thoughts about this remarking on the sales of EVs, it's because of competition from domestic rivals. Plenty of EVs are getting sold, just not as many of them are from BYD as they were. the uk competition and markets authority will launch an investigation into proposed merger of shutterstock into getty images after proposed remedies to anti-competitive concerns fell short and google has removed its gemma family of lightweight models from ai studio after complaints specifically from a u.s senator that it was being used by non-developers to create false information well folks what do you want to hear us talk about on the show we get a lot of what we talk about here from the subreddit.

19:45Big thanks to Motang and R.W. Nash over there. You can join in on the fun. Submit your stories and vote on them at reddit.com slash r slash Daily Tech News Show.

19:58We end every episode of DTNestle, some shared perspective. Last week, Tom used the analogy of data centers being built to railroads being built. Maybe the people who built them didn't profit, but the railroads got used. Andrew has something to add. Yeah, Andrew writes, long time listener, love your work. So what are you preparing me for, Andrew? But thank you. That's a nice way to start the email. Very quick note on your railroad analogy for data center infrastructure. It works, except that railroads remain useful for many decades with minimal maintenance, while GPUs will be obsolete in five. Data center investors don't have much time to find ROI.

20:36Keep up the great work. that's actually a really good point um data centers the technology that goes into today will not be there 20 years from today let alone 100 years from today yeah yeah no that is a very good point it is different uh but let's let's walk through the implications of that the warm shells that they build continue to be useful right as long as you got power in a place to put the racks uh you can swap out those gpus so if you need more warm shells building more warm shells is still good uh and it's not a bad thing for the gpu makers that you have to swap out the gpus regularly right that's going to be a yeah that's going to be a good thing for nvidia and others uh so yes it's it's a very good point i'm not sure if it means a downside though uh unless you know unless the the demand goes away and and that would be true even if the gpus were long lasting.

21:34So the other part of this is that the demand actually will peak up more quickly than what railroads ever could. So railroads were a long-term play. Data centers are kind of, but I don't see, unless somebody comes out with something and says, Hey, AI needs 10 % of what it used to use. Unless we start hearing those kinds of things, we're going to see the need and ramp up in power and the ramp up in CPU and all of that kind of good stuff is going to just increase exponentially in short form rather than the population which drives railroads getting things from point A to point B. Yeah and I think the counter to the well what if AI gets more efficient and doesn't need all this compute is like well then you have more compute.

22:20That's like saying you know what if you have too much bandwidth like nobody's for yet said that's more bandwidth than anybody needs right there's always we always find things we can do with increased bandwidth that we couldn't do before the bandwidth. So theoretically, that's what could happen with compute as well. Folks, we want to know what you're thinking about. Got some insights into a story. Share it with us at feedback at dailytechnewsshow.com. Big thanks to Andrew for contributing to today's show. Thank you for being along for Daily Tech News Show. You are the folks who keep us in business.

22:52If you're not a patron already, check it out. We've got some compelling stuff you can get extra and support the show directly ad-free at patreon.com slash DTNS. The DTNS family of podcasts, helping each other understand. Diamond Club hopes you have enjoyed this broker.