The only reason for xAI to join SpaceX is to offload Elon's Twitter debt in the upcoming IPO.
The staggering amount of money Elon Musk raised for doing AI stuff is quite a bit more than what he ever expended on the Twitter value implosion. I think we can agree that there isn't much left of that. Also, whatever debt was issued for that was issued in dollars. We've had a few years of inflation and dollar devaluation recently. I don't think whatever Twitter debt there was is much of big headache for X at this point.
X.ai is controversial mainly because of Musk. But if you can look beyond that, it does actually have a bit of non trivial IP. Grok is not bad as a LLM. It's not necessarily best in class but it's close enough to be useful. Apple needs to license their AI from Google and OpenAI. MS outsources to OpenAI. Amazon doesn't really have their own models at all. So, as trillion dollar companies go, having your own in house developed model training pipeline that actually works isn't all that common yet.
Musk for all his failings has a talent for looking beyond the current day to day navel gazing that characterizes VC short term thinking and much of the activity in silicon valley. He clearly looks at space as a bit of underused real estate.
Star Link is one of those mad plans that actually seems to make sense now that he has proven that launching thousands of satellites into space isn't that big of a deal and can actually be profitable if you get a few million people to spend billions per month on reliable data connections.
AI data centers in space are similarly ludicrous unless you have a newly developed 100+ ton to orbit reusable launch capability at your disposal. Also, the nature of doing stuff in space is that it is a very people hostile environment. So having some in house AI capability isn't the worst idea for a space company with ambition, which like it or not SpaceX clearly has. I wouldn't call X.ai a bar gain. But what's the alternative if you are semi serious about controlling an armada of space craft across the solar system?
Total investment in xAI are around $30B-40B (including the latest E round). Twitter purchase price at $44B was more than that. Out of that 44B, ~$25B was debt financing.
> Star Link is one of those mad plans that actually seems to make sense now [...] AI data centers in space are similarly ludicrous unless you have a newly developed 100+ ton to orbit reusable launch capability at your disposal
I don't think these two are comparable. Starlink obviously makes sense if you can put thousands of satellites in LEO cheaply, which (only) SpaceX could. The challenge there was to actually build and put them there.
For data centers, even if you can launch for free, the physics and economics don't make sense. Solar is free but the amount of solar arrays (and cooling radiators) required means it's just easier and cheaper to build out the same thing on Earth, and that's without thinking about maintenance of either the data center or the required support equipment.
In theory it can be done. In practice, I humbly propose that putting the same engineering brains on solving the hard questions of keeping people alive in space (so they can, eg, get to Mars and back) would align more closely with the SpaceX mission.
> But what's the alternative if you are semi serious about controlling an armada of space craft across the solar system?
"X Combinator" for space tech (life support, stations, habitats, etc - everything that SpaceX itself isn't focusing on). Refueling depots at strategic locations that are good launching points for deep space (Mars+) missions.
Not a friggin' LLM.
The point of Star link was orders of magnitude reduction in cost of launching thousands of satellites. Musk is talking indirectly about another order magnitude of further reduction of that via star ship; sorry if that wasn't clear.
> the physics and economics don't make sense
This is a popular assertion that despite all the experts chiming in is not that black and white. Clearly investors and Elon Musk beg to differ. Similar arguments were used against Star Link when that was still science fiction. And now it isn't. It actually seems like a good idea that at this point is being copied by others. And SpaceX is getting a lot of the launching business, for now.
I think it's mainly the economics that are the challenge here; not the physics. Implicit in the assertion is that launching the amount of mass needed would be prohibitively expensive. There are lots of engineering challenges as well.
> it's just easier and cheaper to build out the same thing on Earth
Maybe; but it seems challenging to scale there. Permitting and scaling energy generation are a problem right now. But I agree, it's more logical to fix that. But one does not exclude the other. We might end up with a lot of in orbit computation regardless. It's not an either or proposition.