In a deal between companies he already owns, Elon Musk says that low Earth orbit (LEO) provider SpaceX has acquired xAI, an artificial intelligence (AI) company that he founded in 2023. xAI’s products include Grok generative AI and the X social media platform.
The announcement was made in an update on the SpaceX website.
The update, posted yesterday, suggests that the integration of SpaceX and xAI will take on a vexing challenge for the AI industry: the amount of electricity necessary for the nascent technology to thrive is overwhelming and beyond the scope of terrestrial data centers.
The goal is to use solar power to run the data centers. However, the massive amount of energy necessary, Musk wrote, “cannot be met with terrestrial solutions, even in the near term, without imposing hardship on communities and the environment.”
The post maps a future in which there will be satellite launches of mini datacenters on an hourly basis. Musk envisions millions of tons of satellites being launched annually, with each ton generating 100 kW of compute power. This would add 100 gigawatts of AI compute capacity annually without operational or maintenance costs, he wrote. Ultimately, he sees a path to launching 1 terawatt (TW) per year from Earth.
“By directly harnessing near-constant solar power with little operating or maintenance costs, these satellites will transform our ability to scale compute,” Musk wrote in the memo about SpaceX acquiring xAI.
“It’s always sunny in space! Launching a constellation of a million satellites that operate as orbital data centers is a first step towards becoming a Kardashev II-level civilization, one that can harness the Sun’s full power, while supporting AI-driven applications for billions of people today and ensuring humanity’s multi-planetary future.”
The post contained no information about earthbound matters such as the nature of the SpaceX’s acquisition of xAI, why it was necessary, or the precise role xAI will play.
The battle for supremacy in the AI sector is heating up. Last December, the Trump administration issued an executive order that would prevent states from receiving Broadband Equity, Access, and Deployment (BEAD) Program non-deployment funds unless they cede control of AI policy to the administration.
It’s already been a busy year for SpaceX. Last week, SpaceX issued a document addressed to state broadband offices that it called “a rider” outlining the differences between the rules of the BEAD program and how SpaceX perceives its responsibilities as a LEO provider. The letter seeks to release LEO providers from many BEAD Program standards.
