X.com has over 600 million users, and its future is “interconnected” with xAI, which was launched two years ago, according to Elon Musk.
San Francisco:
Elon Musk announced on Friday that his artificial intelligence startup, xAI, is buying his social networking platform X. The deal values the company, formerly known as Twitter, at $33 billion.
Musk said in a post on his social network, “This combination will unlock huge potential by merging xAI’s advanced AI capabilities with X’s massive user reach.”
X has more than 600 million users, and its future is “interconnected” with xAI, launched two years ago.
Musk added, “Today, we are officially taking the step to combine data, models, computing power, distribution, and talent. This will enable us to create a platform that not only reflects the world but actively speeds up human progress.”
x.com
All-Stock Deal and Valuation:
The two companies are merging through an all-stock deal, valuing xAI at $80 billion and X at $33 billion, including $12 billion in social network debt.
Musk bought Twitter at the end of 2022 for $44 billion, which included debt. The following year, he launched xAI and invested billions of dollars in high-end Nvidia chips for the project. x.com
The Rise of xAI and Grok 3:
In February, xAI released the latest version of its chatbot, Grok 3, which Musk hopes will compete strongly in the highly competitive sector dominated by ChatGPT and China’s DeepSeek.
Musk described Grok 3 as “scary smart,” with ten times more computing power than its previous version released last August.
Grok 3 directly competes with OpenAI’s chatbot, ChatGPT, putting Musk against his former collaborator and now rival, Sam Altman. X.com
Musk and Altman Rivalry:
Musk and Altman were part of the 11-member team that founded OpenAI in 2015, aiming to balance Google’s dominance in AI. Musk provided initial funding for the project.
However, three years later, Musk left OpenAI. In 2022, OpenAI’s ChatGPT became a global sensation, making Altman a tech world star. Since then, the relationship between Musk and Altman has become increasingly strained and filled with legal disputes. x.com
Ad Revenue and Political Connections:
X’s billionaire owner, the world’s richest person, is a major financial supporter of US President Donald Trump and leads a Government Efficiency department focused on reducing the number of government employees.
According to industry analysts at Emarketer, ad revenue on X is expected to grow this year as brands fear political backlash if they do not spend on the platform.
Jasmine Enberg, a principal analyst at Emarketer, said, “Many advertisers see spending on X as a cost of doing business to avoid potential legal or financial consequences.” x.com
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Here are 15 multiple-choice questions (MCQs) based on the article:
1. What was the deal value for which Elon Musk’s xAI acquired the social media platform X?
A) $33 billion
B) $44 billion
C) $80 billion
D) $50 billion
Answer: A) $33 billion
2. How many users does the social media platform X have, as mentioned in the article?
A) 400 million
B) 500 million
C) 600 million
D) 700 million
Answer: C) 600 million
3. Which company was previously known as Twitter?
A) xAI
B) X
C) OpenAI
D) SpaceX
Answer: B) X
4. What is the primary reason for merging xAI and X according to Elon Musk?
A) Financial Stability
B) Market Expansion
C) Combining AI capability with user reach
D) Political Influence
Answer: C) Combining AI capability with user reach
5. What type of deal was used to merge xAI and X?
A) Cash Deal
B) All-Stock Deal
C) Debt Purchase
D) Asset Purchase
Answer: B) All-Stock Deal
6. How much debt is associated with the social network X?
A) $10 billion
B) $12 billion
C) $15 billion
D) $20 billion
Answer: B) $12 billion
7. What was the valuation of xAI at the time of the merger?
A) $33 billion
B) $44 billion
C) $60 billion
D) $80 billion
Answer: D) $80 billion
8. Which version of xAI’s chatbot was launched in February?
A) Grok 1
B) Grok 2
C) Grok 3
D) Grok X
Answer: C) Grok 3
9. What does Elon Musk claim about Grok 3? X.com
A) It is less advanced than its predecessor
B) It is 10 times more computationally powerful
C) It lacks AI capabilities
D) It is specifically designed for social media
Answer: B) It is 10 times more computationally powerful
10. Who is Elon Musk’s rival and co-founder of OpenAI? X.com
A) Mark Zuckerberg
B) Sundar Pichai
C) Sam Altman
D) Jeff Bezos
Answer: C) Sam Altman
11. What was the original purpose of founding OpenAI in 2015? X.com
A) To compete with Microsoft
B) To counter Google’s dominance in AI
C) To develop social media algorithms
D) To create cryptocurrency solutions
Answer: B) To counter Google’s dominance in AI
12. How did OpenAI’s release of ChatGPT in 2022 impact Sam Altman?
A) It led to financial loss
B) It made him a tech world star
C) It caused his resignation
D) It initiated a collaboration with Elon Musk
Answer: B) It made him a tech world star
13. Why do industry analysts forecast an increase in ad revenue on X? X.com
A) Due to the introduction of new AI features
B) Fear of political backlash if they don’t spend
C) Growing user base
D) Increased collaboration with Nvidia
Answer: B) Fear of political backlash if they don’t spend
14. What company provided high-end AI chips for xAI? X.com
A) Intel
B) AMD
C) Nvidia
D) Qualcomm
Answer: C) Nvidia
15. Who is the major political figure financially supported by Elon Musk, as mentioned in the article?
A) Joe Biden
B) Donald Trump
C) Kamala Harris
D) Bernie Sanders
Answer: B) Donald Trump