Watch this space Why Elon Musk has merged his rockets with AI

The acquisition of xAI by SpaceX is a typical Elon Musk deal: big numbers backed by big ambition.

- Dan Milmo Global technology editor

As well as extending “the light of consciousness to the stars”, as Musk described it, the transaction creates a business worth $1.25tn (£915bn) by combining Musk’s rocket company with his artificial intelligence startup. It values SpaceX at $1tn and xAI at $250bn, with a stock market flotation expected in June to time with Musk’s birthday and a planetary alignment.

However, there are questions over the deal, such as whether it is good for SpaceX’s non-Musk shareholders and whether the technological premise behind it can succeed.

Why is Musk linking up rockets and AI?

For Musk, a key part of the deal’s rationale is to move datacentres - the central nervous system of AI systems - into space.

AI companies are too dependent on Earth-based datacentres that carry immense energy demands, Musk argued this week. The solution, he says, is to put as many as a million satellites into orbit to form vast, solar-powered datacentres.

Prof Julie McCann and Prof Matthew Santer, the co-directors of the school of convergence science in space, security and telecoms at Imperial College London, say solar-powered datacentres could be a future option for AI companies. However, there are limits to how much compute power can be mustered by current satellites, they say, so it would need a “planet-wide distributed computer composed of many satellites” - as envisaged by Musk.