Elon Musk transfers ownership of X to xAI in $33 billion all-stock transaction

In an unexpected move, Elon Musk has announced the sale of social media platform X to his AI-focused company, xAI, in an all-stock deal valued at $33 billion. Both companies are privately held, meaning that detailed financial disclosures are not required. Musk’s social media platform, which he purchased for $44 billion in 2022, has undergone significant changes under his ownership, including staff cuts, the rebranding of Twitter to X, and shifts in its approach to content moderation, misinformation, and user verification.

Through this deal, Musk aims to fuse the vast user base and data capabilities of X with xAI’s artificial intelligence expertise, envisioning the creation of a combined entity that can leverage both platforms’ strengths. Musk stated that the merger would allow the two companies to innovate more effectively, offering "smarter, more meaningful experiences" for users worldwide while remaining focused on advancing knowledge and truth.

xAI, which Musk launched a year after acquiring Twitter, already uses data from X user posts to train its AI models. X users, particularly those with paid subscriptions, have access to xAI’s chatbot, Grok, which can answer a range of questions. Although the deal is set to reshape both companies, it’s still unclear how this merger will affect users who use X for its social media functionalities and whether changes to X’s interface or experience will come as a result.

The $33 billion deal marks a significant step in the integration of AI with social media platforms, a move that could radically change how users interact with online spaces. xAI already uses data from X’s vast network of posts to fine-tune its AI models, a process that could now be streamlined and expanded following this merger. For paid subscribers, the move will likely improve access to Grok, xAI’s AI chatbot, which has become a key feature for those seeking more advanced interactions within the platform. Currently, paying users have unlimited access to Grok, while free users can ask up to 10 questions every 2 hours.

However, the broader implications for non-premium users are still ambiguous. While Musk has suggested that this merger will enhance user experience, it's not yet clear whether there will be significant changes in terms of functionality, policy, or user interaction on X. The integration of xAI’s advanced AI technology could lead to smarter algorithms, more personalized content, or even new features, but the details remain speculative.

Musk’s announcement may also raise concerns regarding user privacy and data usage, particularly since xAI will now have access to a larger pool of X’s user data. How the combined entity will manage these data-driven challenges, as well as the potential for more AI-powered features, will likely be scrutinized in the coming months.