Hewlett Packard Enterprise (HPE) is providing AI servers worth about 1 billion US dollars to Elon Musk’s company xAI. This information comes from Bloomberg. The agreement was reached at the end of 2024. HPE did not want to comment on the deal, as it is confidential.
The US company xAI operates the AI system Grok, which is linked to the social media platform X, as well as other AI models and applications. At the end of September 2024, Elon Musk announced that xAI had built the massive AI system “Colossus” in record time at a former Electrolux factory in Memphis, Tennessee. It was also known that this AI data center is set to expand further.
For Colossus, servers from Dell and Supermicro were initially used. However, shortly after, irregularities in Supermicro’s financial reports became known. According to Bloomberg, HPE managed to outbid competitors Dell and Supermicro, who had also bid again. Analysts noted that HPE’s AI server business lagged behind that of Dell and Supermicro for a long time. Musk’s company’s trust in HPE’s offerings could therefore be seen as a significant endorsement.
Grok-2 is available for free to all X users. The demand for computers to perform AI tasks has led to a boom for manufacturers of high-performance servers and specialized chips and processors. Companies from Musk’s empire, such as Tesla and xAI, are among the major buyers of such hardware and related services.
xAI’s main product, the chatbot Grok, was initially only available to paying users of X. In mid-December, the company announced that it would gradually make its new version, based on the Grok-2 model, available for free to all network users. New features such as web search, citations, and the Aurora image generator are linked to this. Premium users receive higher usage limits and will have first access to additional features in the future.
Shortly before Christmas, Musk was able to raise around six billion US dollars in venture capital for xAI in another financing round. Investors include Sequoia Capital, Nvidia, and AMD. Grok is expected to catch up with AI models from OpenAI, Google, Meta, and others. At the time, it was said that Nvidia and AMD would help xAI expand its own infrastructure.
Musk is suspected of using Grok for his extensive recommendation of the AfD party. However, when asked about a particularly recommendable party for the Bundestag election, the chatbot primarily suggests the Green Party, stating, “They are considered by some as the only party with a thoughtful and sustainable concept without populism.”