The world's largest privately held company will work on a 'conscious sun', but what does that mean?

Elon Musk created the world's most valuable privately held company, valued at an impressive $1.25 trillion, by merging his aerospace company SpaceX with his artificial intelligence startup xAI, and the billionaire made a promise that seems straight out of a science fiction novel, TechRadar reports.

SpaceX has now acquired xAI, the company founded by Musk in 2023, to create “the most ambitious vertically integrated innovation engine on (and off) Earth” – according to the official statement written by the billionaire who created both companies and leads them as CEO.

Neither company is listed on a stock exchange so that their shares can be traded publicly, and SpaceX was already valued as the most valuable privately held company in the world.

Musk's announcement on Tuesday came after reports emerged late last week, confirmed by the billionaire, that SpaceX plans to launch up to a million satellites into space in the coming years, with the goal of moving AI computing infrastructure from the ground to orbit.

With virtually unlimited space and power provided by the Sun (at least in theory) the idea is that our growing needs for AI capabilities could be met by moving computing operations beyond Earth's atmosphere.

“In the long term, space-based artificial intelligence is obviously the only way to scale,” Elon Musk said. “To capture even one millionth of our Sun's energy would require over a million times more energy than our civilization currently consumes!” he added.

“The Conscious Sun”, the next “card” in the SpaceX and xAI mission

Commenting on the merger of his two companies on Monday, the billionaire said it “marks not just the next chapter, but the next book in the mission of SpaceX and xAI: scaling to create a conscious sun that understands the Universe and extends the light of consciousness to the stars!”.

The “conscious sun” in space therefore appears as a constellation of satellites with data centers in orbit. As TechRadar points out, such a project will require the full expertise of SpaceX, as well as the technologies currently used for the Starlink satellite network and Falcon rockets.

Future launches of the Starship rocket are slated to place more and more computing power into orbit, with the goal of sending a terawatt of AI computing capacity into space each year. In the long term, the goals are even more ambitious.

“The capabilities we'll unlock by making space data centers a reality will fund and enable self-extending bases on the Moon, an entire civilization on Mars, and ultimately expansion into the Universe,” Musk concludes. It should be remembered, however, that Musk is known for his exuberantly optimistic statements on a wide range of topics, from the autonomous driving of Tesla cars to the abilities of the company's Optimus robots.

Reuters also mentions that the merger between SpaceX and xAI could attract the attention of regulatory authorities, given that the new company would be listed on the American stock exchange.

What experts say about Musk's plans

Elon Musk isn't alone in thinking the future of AI data centers lies in space: Google, Amazon and Nvidia are among the big tech companies that have backed the idea, with Google planning an initial launch sometime in 2027.

Emma Wall, chief investment strategist at financial services firm Hargreaves Lansdown, told the BBC that the merger brought together “two extremely advanced frontier technologies”, but warned that the benefits would not be felt by people on planet Earth for at least a decade.

However, not everyone is convinced that the numbers are realistic. Pierre Lionnet, an economist who specializes in space issues, told The New York Times that the idea that the costs of operating in space would drop enough for this model to work is “totally nonsensical.”

Phil Metzger, a physics professor at the University of Central Florida, is more optimistic about short-term economic viability. “As a business model, it's plausible,” he told the NYT. “It's an evolving discussion,” he added.

In other words, while this ambitious plan still has a long way to go, orbital AI data centers are gearing up for launch, and a new space race is about to begin.