When Elon Musk acquired Twitter for $44 billion in 2022, some critics considered it an impulsive overpayment. Two years later, as xAI's valuation approaches $45 billion and his companies hold $15 billion in government contracts, Elon is sitting pretty.
Musk's rise to AI dominance began with what appeared to be an expensive purchase. The acquisition of Twitter has sparked controversy as Musk implemented dramatic changes, including reportedly slashing the workforce by up to 80%, and strained relationships with key advertisers.
While critics focused on Twitter's transformation into X and its apparent stumbles, Musk 'quietly' launched xAI in July 2023. Valued at $24 billion in May of this year, xAI has potentially doubled as Middle Eastern investors eye valuations between $40-45 billion. And that was before Trump won the election.
One way to look at the maths is that Musk bought Twitter, X, or whatever you want to call it for free.
X, far from being just a social media platform, has become a vast data repository for AI training. Privacy policy changes now allow third-party "collaborators" to use the platform's data for AI development. This mirrors similar moves by platforms like Reddit, which provide access to X's global reach and real-time data flow and have opened up the revenue arteries in ways not many saw possible in 2022.
With $15 billion in government contracts, million-dollar giveaways, and his new best buddy in the White House, Musk has positioned himself at the intersection of private enterprise and public policy. His company's influence extends from space exploration to electric vehicles and increasingly to the future of artificial intelligence.
The transformation of X from a social media platform into an AI development engine, has perhaps been misunderstood by everyone the world over.
Integrating social media, AI development, and political influence sounds like the plot of the most extraordinary Airport thriller never written. But the 21st Century has taught us to expect the unexpected.
As one AI Industry insider noted to me
''It will be interesting to see if the Trump administration winds down the Biden government's promotion of AI safety and responsible AI, such as the AI Bill of Rights.''
What power Elon will be given to wield? And where will he point that power?
Musk's apparent gambles - from the Twitter acquisition to the AI push - now appear as somewhat logical stepping stones on the road to worldwide reach.
I picture Elon sitting serenely somewhere, smiling, laughing, and, in between, laughing a bit more.