Elon Musk has sold social media site X to his own xAI artificial intelligence company in a $33 billion all-stock deal, the billionaire announced on Friday.
  • KulunkelBoom@lemm.eeEnglish
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    7 months ago

    So… computer programs can now own property. Interesting. Is this the first step in giving computers the vote?

    • alvvayson@lemmy.dbzer0.comEnglish
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      7 months ago

      Correct.

      It’s actually a smart move.

      The dumb money are those pouring hundreds of billions into the AI hype. This is .com bubble on steroids.

      And sure, AI obviously is becoming an important market, but it will not be the current leaders who will dominate the tech. Like the internet, it’s just too easy to catch up for competitors. Pouring $100B into AI today will only mean you lose out to the $1B startup in 2 years. The incumbents will go broke.

      • golli@lemm.eeEnglish
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        7 months ago

        The incumbents will go broke.

        Who do you mean with that? Companies like OpenAI or Anthropic, or do you also include the likes of Google/Amazon/Microsoft?

        With the former I can see it, but the later also profit from providing the infrastructure (and have other profitable business), so imo those will be just fine.

        • alvvayson@lemmy.dbzer0.comEnglish
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          7 months ago

          I definitely see Google/Amazon/Microsoft shedding a huge amount of market cap when the time comes to write-off the 100s of billions they invested the past two years.

          They just don’t have any feasible path to recouping those investments.

          Sure, they’ll never go fully broke, that’s just a nice word for emphasis.

          • golli@lemm.eeEnglish
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            7 months ago

            As i understand it most of the money they are investing goes into new datacenters. So when a model gets outdone by a new one they still have those, unlike e.g. OpenAI that use other companies resources (i think microsoft and oracle mostly?). In a way companies that use those external clouds to train their own models are financing the investments needed for the big players.

            AWS, GCP and Azure are all growing 30%+ yoy, are profitable and if anything supply constraint in that they can’t build more capacity fast enough to meet demand. So it seems to me that to some degree they are already recouping some of those investments. I don’t see a drop in demand for compute, and even if using/training ai would become less resource intensive, Jevons paradox would just lead to more demand.

            Of course they also burn a lot of money as anytime a new model gets trained and beats the older ones, it kind of renders the resources spend on the previous one worthless. But to me that seems like the cost of doing business.

            The current investments they can afford. What would actually lead to shedding huge amounts of marketcap is, if they’d let a rival establish themselves. Similar to how the movie studios didn’t get into streaming early (mostly to not hurt their cable business) and gave Netflix enough time to establish themselves.

            To comment on something you mentioned in another reply below:

            I just don’t see a world where most people are coughing up more than $10 a month for AI.

            I think the big money will be in the business world, where salaries for actual people are high enough that saving a person even a few hours/week or replacing a single employee saves so much money that even expensive subscriptions would easily be worth it.

            On the consumer side as you say running smaller models locally will likely be the norm. But that means it would be free for both the likes of Deepseek and Google. And then it’ll just come down to who has access to personal information and is better embedded, which would be likely be whoever also controls other aspects of a users life, such as Goole with Android, gmail etc. Money here will be made just as it is done with other free services.

  • skozzii@lemmy.caEnglish
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    7 months ago

    This might have the opposite effect he wants, xAI investors no longer have a clean AI investment and are now linked to a failing social media platform.

    xAI is already losing bigtime vs other AI companies, this just makes it even less attractive.

  • Kwyjibo1@lemmy.myserv.oneEnglish
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    7 months ago

    Musk’s slight of hand shell game to keep from losing his shirt if his Tesla stock keeps dropping and his X financiers come looking for money.

      • _stranger_@lemmy.worldEnglish
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        7 months ago

        It’s almost better than losing money. He put up a certain amount of Tesla stock as collateral for the loan (essentially) to buy Twitter.

        So if Tesla’s stock tanks, those creditors will be able to claw more stock away from him. If it tanks enough, he’s in hostile takeover territory.

    • Laser@feddit.orgEnglish
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      7 months ago

      Well, not really. Twitter was his own private property that he bought with borrowed money secured against his Tesla shares. xAI on the other hand is financed by investors whose money he used to bail himself out at a price he made up himself since Twitter is no longer publicly traded. So this is, in my opinion, misuse of investor funds; the picture would be true if xAI used how own money to do this, but no.

      On one hand,I think this is serious fraud. On the other, my understanding for anyone investing into his companies is very limited, there are so many red flags on so many levels.

  • ChicoSuave@lemmy.worldEnglish
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    7 months ago

    Is this so the loans secured with X stock can’t be called in, forcing Elon to sell the collateral to pay back the loan?

    Sure seems like a bullshit business move to retain control of Tesla.

  • merdaverse@lemmy.worldEnglish
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    7 months ago

    The combination values xAI at $80 billion and X at $33 billion ($45B less $12B debt)

    Lol, he actually think the value of Shitter is still $45B, as when he bought it. That’s cute.