Technology & Science
SpaceX Absorbs xAI to Launch Million-Satellite Orbital Data Centers
Elon Musk folded his AI firm xAI into SpaceX in an all-stock deal, positioning the $1 trillion rocket company to build solar-powered AI data-centre constellations and seek a public listing later in 2026.
Focusing Facts
- Internal memo values the combined entity at roughly $1.25 trillion—$1 trillion for SpaceX and $250 billion for xAI.
- On 30 January 2026, SpaceX filed with the U.S. FCC for permission to deploy up to 1 million satellites to serve as “orbital data centers.”
- Tesla poured $2 billion into xAI in January 2026, days before the merger, despite a shareholder vote in which abstentions and ‘no’ outnumbered ‘yes.’
Context
This move echoes Henry Ford’s 1920s drive toward vertical integration—owning steel mills, rubber plantations, and shipping—to control every input of automobile production. Musk is similarly knitting rockets (launch), Starlink (bandwidth), and xAI (compute) into a single stack, betting that off-planet energy and cooling will outstrip Earth-bound data centres much as offshore oil replaced shallow wells in the 1950s. It taps two megatrends: the commercialization of low-Earth orbit since the 2010s and the voracious, power-hungry growth of foundation AI models after 2022. If successful, the deal could mark the first large-scale industrial migration beyond Earth, shifting jurisdiction, energy use, and strategic leverage for decades—perhaps akin to the British East India Company’s 17th-century monopoly that shaped geopolitics for a century. If it fails, it will join prior grand schemes—like Teledesic’s 1990s satellite network—that collapsed under cost and physics. Either way, it signals a future where the boundary between aerospace, energy, and cognition blurs, redefining what “infrastructure” means on a century horizon.
Perspectives
Indian business press
e.g., Zee Business, Asianet News Network — Presents the SpaceX-xAI merger as a visionary, “win-win” leap that will give Musk a decisive computing edge and turbo-charge a $20-trillion AI opportunity. Relies almost entirely on Musk’s rhetoric and bullish analysts, skimming over shareholder push-back or regulatory probes because upbeat coverage attracts retail investors and business-minded readers.
Western financial and wire outlets
e.g., BBC/News.az, Reuters — Acknowledge the record-setting scale of the deal but stress shareholder objections, spiralling costs and ongoing regulatory investigations into xAI’s Grok chatbot. By foregrounding risks and compliance issues, they cater to risk-averse investors and a governance-focused audience, potentially underplaying Musk’s technical upside to maintain a stance of hard-nosed prudence.
South Korean conservative media
Chosun.com — Frames the merger as the birth of a “monster corporation” that could upend the global AI race by monopolising space-based data and amplifying Musk’s geopolitical clout. Echoes national-competitiveness anxieties—admiring the scale yet warning of unchecked foreign dominance—to energise domestic readers concerned about Korea’s tech position.