xAI: Elon Musk Builds a New Empire on the Ruins of His Old Promises

Elon Musk is doing what he does best again — creating a gravitational field around his ideas that forces money and talent to move in the direction he wants. The headline that "Musk bought Musk" sounds like a pun, but it conceals a tectonic shift in his business empire. We are witnessing xAI stop being simply an ambitious side project and transform into Elon's main asset, for which he is willing to sacrifice the interests of his other companies.

This is classic Musk: when the old toy starts demanding too much routine work, he creates a new one, even more ambitious. Context matters more than the numbers themselves. After Musk quarreled with Sam Altman and OpenAI, he spent a long time trying to prove that Tesla was the world's leading AI company.

However, reality proved more complicated. Training large language models requires specific resources that the automaker simply doesn't have in sufficient volume. As a result, we saw the creation of xAI, which attracted colossal financing in record-breaking timeframes.

Now this startup is essentially vacuuming up the best talent from Tesla and using X's infrastructure to train its models. Musk is literally shifting the center of gravity of his innovations to a new structure, leaving Tesla shareholders in mild bewilderment. The technical side of things impresses even skeptics.

The foundation of this new empire is the Colossus supercomputer, running on 100,000 Nvidia H100 chips. This is not just a warehouse of hardware, but the most powerful computing cluster on the planet, built in record time in Memphis. While competitors from Google and Microsoft spend years coordinating construction permits, Musk simply builds.

This cluster is needed to train Grok 3, which is intended to surpass GPT-4 in all parameters. The irony is that xAI sources the data for this training from X, which Musk bought earlier. The result is a perfect closed ecosystem, where one company supplies the data, another builds the brains, and a third is supposed to be their physical embodiment.

Why does this matter right now? Because we are witnessing the birth of a new type of conglomerate. If previously Musk's companies were connected only by his personality, now they are connected at the level of data and computation.

xAI becomes the "brain center" that will control both Optimus robots and Tesla's autopilot and recommendation algorithms on X. This is an attempt to create vertically integrated intelligence. However, such a strategy carries enormous risks.

The diversion of resources from public Tesla to private xAI is already raising questions from regulators and lawyers. Musk is playing a dangerous game where institutional investors' trust is at stake — they don't like it when their assets are "optimized" for the founder's new obsessions. Ultimately, we are seeing Elon attempt to correct his major historical mistake — leaving OpenAI.

He wants to own AI exclusively, without sharing control with a board of directors or external partners. xAI is his chance to become the sole ruler of the technological future. For now, Grok looks more like an amusing chatbot with questionable humor, but with this amount of computing power and data, it is only a matter of time before it becomes a serious player.

Musk is building the foundation upon which all his future legacy will stand, and for this he is willing to buy himself out as many times as necessary. The main point: xAI has definitively become priority #1 for Musk, relegating Tesla to second place in AI development matters. Will he be able to maintain balance between all his companies, or will one absorb the others?