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Two of Elon Musk’s companies are merging to build data centers in space, according to a post on the SpaceX website. The rocket and satellite company has acquired xAI, Musk’s artificial intelligence company, which also owns the social media platform X (formerly Twitter).
In the post, Musk said the combined company is “the most ambitious, vertically integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet, direct-to-mobile device communications and the world’s foremost real-time information and free speech platform.”
SpaceX is planning a public offering, and the acquisition — the largest in history — could place the value of Musk’s company at $1.5 trillion, according to Bloomberg, which first reported on the deal. The New York Times estimates the value as closer to $1 trillion.
In the post, Musk cited concerns about Earth-based data centers, including their huge electricity needs and the “hardship on communities and the environment” they pose. He said the acquisition is part of a plan to use solar power to run data centers and space-based facilities that would train AI models and drive scientific breakthroughs.
“My estimate is that within 2 to 3 years, the lowest cost way to generate AI compute will be in space,” Musk said.
A representative for SpaceX didn’t immediately respond to a request for comment.
SpaceX recently promised Gigabit internet speeds from space with its V3 Starlink satellites.
What it means for the rest of us
While Musk’s post focused on data center needs and the future of AI, the merger could have implications not only for those in the artificial intelligence industry but also for customers of services that are part of the deal, including Starlink and X.
For instance, Starlink recently made a change to its privacy policy that says the company will use customer data to train AI.
“The use of personal data from its 9 million users for AI training unless they explicitly opt out is a stark reminder of the trade-offs in our increasingly connected world,” says Mahdi Eslamimehr, executive vice president at Quandary Peak Research. “Consumers should be wary of a future where a single entity controls not only their internet access and a major social media platform but also the AI models trained on their personal data, especially given the controversial past of xAI’s Grok chatbot.”
The merger could be less about space than about competing with earthbound competitors such as ChatGPT maker OpenAI and Claude maker Anthropic, he adds.
Combining the technologies of Musk’s various companies also “plants the seed for a future where AI assistants, content generation and real-time translation are not limited by geography or local energy infrastructure,” he says — even if that outcome is years away.
Lastly, if Musk can deliver “on even a fraction of his ambitions,” Eslamimehr says the possible cost reductions from using solar power as well as cooling via the vacuum of space could be passed down by lowering subscription prices and AI use limits.
Two of Elon Musk’s companies are merging to build data centers in space, according to a post on the SpaceX website. The rocket and satellite company has acquired xAI, Musk’s artificial intelligence company, which also owns the social media platform X (formerly Twitter).
In the post, Musk said the combined company is “the most ambitious, vertically integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet, direct-to-mobile device communications and the world’s foremost real-time information and free speech platform.”
SpaceX is planning a public offering, and the acquisition — the largest in history — could place the value of Musk’s company at $1.5 trillion, according to Bloomberg, which first reported on the deal. The New York Times estimates the value as closer to $1 trillion.
In the post, Musk cited concerns about Earth-based data centers, including their huge electricity needs and the “hardship on communities and the environment” they pose. He said the acquisition is part of a plan to use solar power to run data centers and space-based facilities that would train AI models and drive scientific breakthroughs.
“My estimate is that within 2 to 3 years, the lowest cost way to generate AI compute will be in space,” Musk said.
A representative for SpaceX didn’t immediately respond to a request for comment.
SpaceX recently promised Gigabit internet speeds from space with its V3 Starlink satellites.
What it means for the rest of us
While Musk’s post focused on data center needs and the future of AI, the merger could have implications not only for those in the artificial intelligence industry but also for customers of services that are part of the deal, including Starlink and X.
For instance, Starlink recently made a change to its privacy policy that says the company will use customer data to train AI.
“The use of personal data from its 9 million users for AI training unless they explicitly opt out is a stark reminder of the trade-offs in our increasingly connected world,” says Mahdi Eslamimehr, executive vice president at Quandary Peak Research. “Consumers should be wary of a future where a single entity controls not only their internet access and a major social media platform but also the AI models trained on their personal data, especially given the controversial past of xAI’s Grok chatbot.”
The merger could be less about space than about competing with earthbound competitors such as ChatGPT maker OpenAI and Claude maker Anthropic, he adds.
Combining the technologies of Musk’s various companies also “plants the seed for a future where AI assistants, content generation and real-time translation are not limited by geography or local energy infrastructure,” he says — even if that outcome is years away.
Lastly, if Musk can deliver “on even a fraction of his ambitions,” Eslamimehr says the possible cost reductions from using solar power as well as cooling via the vacuum of space could be passed down by lowering subscription prices and AI use limits.
Two of Elon Musk’s companies are merging to build data centers in space, according to a post on the SpaceX website. The rocket and satellite company has acquired xAI, Musk’s artificial intelligence company, which also owns the social media platform X (formerly Twitter).
In the post, Musk said the combined company is “the most ambitious, vertically integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet, direct-to-mobile device communications and the world’s foremost real-time information and free speech platform.”
SpaceX is planning a public offering, and the acquisition — the largest in history — could place the value of Musk’s company at $1.5 trillion, according to Bloomberg, which first reported on the deal. The New York Times estimates the value as closer to $1 trillion.
In the post, Musk cited concerns about Earth-based data centers, including their huge electricity needs and the “hardship on communities and the environment” they pose. He said the acquisition is part of a plan to use solar power to run data centers and space-based facilities that would train AI models and drive scientific breakthroughs.
“My estimate is that within 2 to 3 years, the lowest cost way to generate AI compute will be in space,” Musk said.
A representative for SpaceX didn’t immediately respond to a request for comment.
SpaceX recently promised Gigabit internet speeds from space with its V3 Starlink satellites.
What it means for the rest of us
While Musk’s post focused on data center needs and the future of AI, the merger could have implications not only for those in the artificial intelligence industry but also for customers of services that are part of the deal, including Starlink and X.
For instance, Starlink recently made a change to its privacy policy that says the company will use customer data to train AI.
“The use of personal data from its 9 million users for AI training unless they explicitly opt out is a stark reminder of the trade-offs in our increasingly connected world,” says Mahdi Eslamimehr, executive vice president at Quandary Peak Research. “Consumers should be wary of a future where a single entity controls not only their internet access and a major social media platform but also the AI models trained on their personal data, especially given the controversial past of xAI’s Grok chatbot.”
The merger could be less about space than about competing with earthbound competitors such as ChatGPT maker OpenAI and Claude maker Anthropic, he adds.
Combining the technologies of Musk’s various companies also “plants the seed for a future where AI assistants, content generation and real-time translation are not limited by geography or local energy infrastructure,” he says — even if that outcome is years away.
Lastly, if Musk can deliver “on even a fraction of his ambitions,” Eslamimehr says the possible cost reductions from using solar power as well as cooling via the vacuum of space could be passed down by lowering subscription prices and AI use limits.
[analyse_source url=”http://cnet.com/tech/services-and-software/elon-musks-spacex-acquiring-xai-space-data-centers/”]