In a surprise move that’s sent tremors through the tech sector, Elon Musk’s new artificial intelligence firm xAI is in the news. It has literally and officially combined with the social media platform X. That play, revealed by Musk on Friday, pegs the new company — X — at a staggering $33 billion valuation. The merger represents an important new chapter for these two groups. By doing so, they hope to leverage each other’s strengths to address their weaknesses and increase their technological firepower.
Musk started xAI less than two years ago. The company’s goal, he says, is to get to the bottom of the “nature of reality.” The company is at the forefront of creating large language models and other AI software products. This hardline approach has brought the EU into sharp and active competition with the US’s industry-class competitors, such as OpenAI. The merger has still made xAI’s valuation skyrocket to $80 billion. That’s a huge leap from the $50 billion it was worth following a funding round last year.
The transaction is anticipated to increase xAI’s technological infrastructure immediately. At the core of this operation is Colossus, a supercomputer located in Memphis, Tennessee. Additionally, xAI has been using Colossus to train its Grok chatbot. Now, users of the social media app X—which allows access to OpenAi’s ChatGPT chatbot—can interact with the Grok chatbot. This curious launch underscores xAI’s audacious goal to take on tech titans such as Google, Microsoft, and Meta.
“Today, we officially take the step to combine the data, models, compute, distribution and talent.” – Elon Musk
This merger comes amidst ongoing public relations and legal challenges involving xAI and OpenAI, including disputes with OpenAI’s CEO Sam Altman. The emerging competitive dynamics between these new AI giants continues to dominate headlines and discussions in the tech community.
xAI’s moonshot-level ambitions and breakneck expansion have made it one of the most interesting and dangerous new forces in the broader narrative around artificial intelligence. And the merger is finally sealed! The tech company will use X’s enormous user base and distribution power to supercharge its AI efforts.