What's up: Sam Altman ties tech’s biggest players to OpenAI; Oracle’s dual CEOs co-lead AI makeover; data-center power use becomes antitrust issue

Good morning. Where were you when the internet stood still? Vineet Jain, chief executive of Silicon Valley-based software firm Egnyte, said he was trying to buy an online coupon at a restaurant around 10:45 a.m. Pacific time Monday, but the transaction failed because it was running on cloud infrastructure giant Amazon Web Services. The company’s platform helps businesses manage, secure and govern their cloud content.

“Leaving aside my personal experience,” Jain said that Mountain View, Calif.-based Egnyte’s integration with some customers was disrupted.

There are plenty of lessons to draw from the AWS breakdown, which began early Monday morning. A glitch with an Amazon database disrupted life for millions of people across the U.S. as core internet services failed to function for an array of companies. The WSJ’s comprehensive account of the day, by Robert McMillan, Sean McLain and WSJLI’s Belle Lin, captures the breadth of the impact, and how deeply reliant the economy is on core internet companies.

How it happened:

A minor update to what’s called the Domain Name System—the kind of software tweak that happens millions of times a day on the internet—sent the well-oiled machine that underpins the modern web careening toward a crash.

DNS acts as a kind of telephone directory for the internet, instructing machines on how to find each other. The faulty update gave the wrong information for DynamoDB, an Amazon Web Services product that has become one of the world’s most important databases.

Suddenly, machines on the East Coast that tried to process trillions of requests were getting the internet’s equivalent of a wrong number.

DNS has been a vulnerability for both resilience and cybersecurity for years.

I asked several tech CEOs how their business was affected by the AWS outage and what lessons they took away from the episode.

“Internal productivity was a challenge for some of the Pendo team today,” said Todd Olson, co-founder and CEO of the company in Raleigh, N.C., which provides a software platform that helps companies improve user experience for their products. “We had minimal customer impact because the Pendo platform is primarily hosted on Google Cloud,” Olson said.

He thinks that a diversification of cloud services will help reduce risk associated with a single point of failure.

“This was already underway before today's outage, but we're looking at becoming more multi-cloud in our product to reduce reliance on any one service. We’d still have risk of an impact, but it would be for a subset of customers rather than taking everyone down,” Olson said.

Alex Salazar, CEO of San Francisco-based Arcade.dev, said he draws three lessons from the AWS outage in its East-1 region. The startup is developing tools to tackle the problem of getting agents signed into websites, APIs and apps.

Multi-region beats multi-cloud. “The outage shows you need resilience, but the answer isn't multi-cloud. That's expensive and complex as hell. The differences between clouds make the lift huge. Multi-region on one provider like AWS is good enough, even for mission-critical apps.”

East-1's dominance is wild. “One specific region being this central to the internet is remarkable. Shows how critical AWS has become to everything.”

Databases are the real blocker. “Multi-region isn't hard because of servers or clouds -- it's the databases … Most software-as-a-service vendors run on a single database that can't sync … across regions in real time. So even with multi-region apps, you're vulnerable if your data is stuck in one place.”

What lessons do you take from the AWS outage? Use the links at the end of this email and let us know.

OpenAI's Sam Altman has gone on a dealmaking blitz, playing the egos of Silicon Valley’s giants off one another as they race to cash in on the startup's future growth, WSJ reports.

On four separate days over the past two months, the stock prices of Oracle, Nvidia, Advanced Micro Devices, and Broadcom soared after they disclosed OpenAI-related deals—adding a combined $630 billion to their market value in the first day of trading after the announcements. 

The resulting game of financial one-upmanship has tied the fates of the world’s biggest semiconductor and cloud companies—and vast swaths of the U.S. economy—to OpenAI, essentially making it too big to fail.

The Altman way. “The most successful people I know believe in themselves almost to the point of delusion,” Altman once wrote in a 2019 blog post titled “How To Be Successful,” before adding: “Self-belief alone is not sufficient—you also have to be able to convince other people of what you believe.”

By definition, there is usually only one chief in any organization. There is one president, one commander in chief, one head coach, one conductor and typically one chief executive. For the second time in its history, Oracle has two.

CEO Clay Magouyrk, 39, runs Oracle’s cloud infrastructure business, which includes OpenAI among its customers. CEO Mike Sicilia, 54, is in charge of “go-to-market” functions including sales and applications. They share the spotlight with Chairman Larry Ellison, who co-founded the company nearly 50 years ago and is still very much active as chief technology officer and chairman.

Magouyrk and Sicilia tell WSJ Leadership Institute's Belle Lin that they will each lean on the other’s area of specialty as they divvy up responsibilities at the very top. “We’re in a constant feedback loop of the team saying, ‘Hey, we need this, we need that. This is how high-performance compute impacts banking,’” Sicilia said.

But what hasn’t changed is Ellison’s role setting the vision behind the company, and likely resolving any conflicts, if they come up. All three leaders speak numerous times each day.

Communities in places like Mexico, Chile, Ireland and Spain are tying recent facility builds to increased power outages and water shortages, the New York Times reports. Some have tried blocking future projects. Not helping matters is a lack of transparency among tech companies who reveal little on the resources their facilities consume.

Regulators are taking note of the surge in power demands. France’s competition enforcer is studying access to energy for players in the AI sector, WSJ reports. 

Amazon is planning to automate some 75 percent of its operations, according to a review of internal documents, the New York Times reports. 

President Trump’s $100,000 H-1B visa fee will only apply to new visa applicants outside the country, the government confirmed  Monday, according to the WSJ. That means that under the new policy, employers won’t need to pay the fee for anyone already living in the U.S., such as international students.

Apple shares Monday climbed 3.9%, closing at $262.24 and helping the company surpass Microsoft to become the second largest in the U.S. by market capitalization after Nvidia, WSJ reports. The gains came after research firm Counterpoint said the new iPhone 17 series outsold the iPhone 16 series by 14% during the first 10 days it was available in China and the U.S.

OpenAI said it is working with actor unions, including SAG-AFTRA t to build guardrails against deepfakes conjured up by its own video creator, Sora, CNBC reports. 

The Treasury Department instructed employees not to share photos of the demolition of parts of the White House’s East Wing after images of construction equipment dismantling the facade of the building went viral online. (WSJ)

A federal appeals court will allow President Trump to deploy the National Guard to Portland, Ore., despite objections from state and local officials who say that no emergency exists to justify the federal show of force. (WSJ)

Former President Nicolas Sarkozy began a five-year prison sentence on Tuesday, marking an unprecedented downfall for a French ex-head of state who rose to power as a political outsider with blunt law-and-order rhetoric. (WSJ)

Sanae Takaichi was confirmed as Japan’s first female prime minister in a parliamentary vote, giving the country a new leader who advocates close ties with the U.S. and a stronger Japanese military. (WSJ)

The WSJ CIO Journal Team is Steven Rosenbush, Isabelle Bousquette and Belle Lin.

The editor, Tom Loftus, can be reached at thomas.loftus@wsj.com.