Oracle Just Crushed a $5M Deal Between Red Bull and an AI Rival

Oracle has reportedly thrown a wrench into a sponsorship deal, blocking an agreement between f1 team Red Bull Racing and AI company Perplexity that was valued at $5 million annually.

This deal was set to position the latter as a pretty big player in the tech-driven landscape of Formula 1 sponsorships. However, with Oracle's intervention, the agreement was stopped despite Red Bull and Perplexity having already agreed on the terms. This news comes from The Verge, who have reportedly seen evidence to support the story.

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Oracle, the title sponsor of Red Bull Racing, has a five-year sponsorship commitment worth approximately $300 million. This substantial financial backing provides Oracle with the leverage to influence Red Bull's sponsorship decisions, including the power to veto new partnerships such as this.

The potential conflict arises as Oracle pursues its interests in the AI space, including its reported bid to acquire TikTok and its involvement in the high-profile Stargate project. Oracle and Perplexity both have stakes in AI markets, and Oracle's actions prove the competition between the two companies.

Neither Oracle nor Red Bull, nor Perplexity have commented on the blocked deal, leaving the outcome of the sponsorship dispute unclear.

Perplexity stands out in the tech world. In a recent funding round, the company secured $500 million, pushing its valuation to $9 billion. For Perplexity, this sponsorship was seen more as a branding opportunity than a financial necessity, as the $5 million deal represented only about 1% of its recent funding.

Formula 1 has become an increasingly attractive platform for tech companies looking to boost their brand visibility. McLaren, for example, has partnered with Google, using AI-driven analytics to improve performance. Mercedes-AMG Petronas works with CrowdStrike on cybersecurity solutions, and Williams Racing has recently confirmed its title sponsorship with Atlassian for its software development tools. A global audience of over 500 million viewers and its focus on high tech and innovation make Formula 1 a compelling promo spot for technology giants.

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Despite the missed $5 million agreement being relatively small compared to Oracle's $300 million commitment, it's a missed opportunity for the team that finished only third last year in the Constructor's Standings. Of course, it won't want to mess with a 9-figure sponsorship, but paying Max Verstappen's yearly contract doesn't come cheap.

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