Musk Just Merged AI Into Space

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🚀 SpaceX Absorbs xAI as Musk Pushes Data Centers Into Orbit

Elon Musk has officially merged his AI startup xAI into SpaceX, creating a combined private company reportedly valued at $1.25T. xAI will now operate as a division inside SpaceX, with the deal arriving as SpaceX prepares for a possible IPO later this year.  

The Decode:

1. SpaceX officially acquires xAI - SpaceX confirmed it has acquired xAI, bringing Musk’s AI business directly under his space company. Bloomberg reported the merger values the combined entity at $1.25 trillion, making it the world’s most valuable private firm.

Musk says terrestrial data centers cannot meet rising AI power and cooling demands without environmental strain. His fix is launching space-based compute hubs, powered by near constant solar energy and less limited by Earth’s constraints.

2. Financial pressure is driving consolidation - xAI is reportedly burning around $1B per month, while SpaceX earns most of its revenue through Starlink launches. Musk argues that building orbital compute will require a steady flow of satellites.

SpaceX is still working toward Starship missions to the Moon and Mars, while xAI competes with OpenAI and Google under intense pressure. Musk recently loosened Grok restrictions, which contributed to serious misuse concerns around AI-generated imagery.

Musk’s bigger pitch is that orbiting AI compute could become cheaper than Earth-based data centers within 2–3 years, powered by constant solar energy. He frames it as infrastructure for Moon bases, a Mars civilization, and long-term expansion beyond Earth itself.

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📚 Microsoft Builds A Marketplace For AI Content

Microsoft is launching a new system to formalize how AI tools access publisher content. The goal is to move from unpaid scraping toward licensed, trackable usage as AI systems increasingly rely on trusted sources to generate answers and recommendations.

The Decode:

1. Licensing Hub For Publishers Publisher Content Marketplace lets publishers define usage terms while AI builders license content for grounding responses. This creates a structured way to access premium archives without unclear scraping or informal agreements.

2. Usage-Based Payment Model - PCM includes reporting that shows when and how publisher content is used inside AI outputs, allowing publishers to price content based on delivered value, not flat deals or traffic alone.

3. Built To Scale Industry Wide - The marketplace avoids one-off negotiations between every publisher and AI provider. Participation is voluntary, ownership stays with publishers, and the model works for both large media groups and niche outlets.

The old web model traded content for clicks, but AI answers reduce traffic while still depending on publisher work. As AI agents shape purchases, finance, and healthcare decisions, trusted premium sources become more valuable than generic web data. Microsoft plans to expand PCM to more AI builders who agree that content must be governed.

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🛡️ OpenAI hired Dylan Scandinaro as its new Head of Preparedness, poaching him from Anthropic’s AGI safety team. He warned AI risks could be “extreme” and even “irrecoverable,” with little time left to prepare.

🚀 Intel says it will start producing GPUs, entering Nvidia’s dominant AI chip market. CEO Lip-Bu Tan confirmed the effort will be led by data center chief Kevork Kechichian, with Eric Demers hired from Qualcomm to help build the strategy.

💙 Fitbit founders launched Luffu, an AI family health platform that tracks meds, vitals, symptoms, and caregiving signals across households. Nearly 63M Americans are caregivers today, up 45% in 10 years.

🍎 Xcode 26.3 brings agentic coding to Apple developers, integrating OpenAI Codex and Anthropic Claude Agents to explore projects, run tests, fix errors, and automate complex workflows directly inside the IDE.

🎬 Higgsfield AI launched Vibe Motion, a Claude-powered tool that lets creators generate and edit motion graphics with simple text prompts, making high-quality animation workflows faster, more accessible, and design-friendly.

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🤳AI Nugget of the Day

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