Very possible Elon is doing this to make give Anthropic better chances against OAI while he attempts to reshape xAI.<p>Also possible he sees infra as the future of xAI if he really believes in the value of space compute.<p>Hard to see this any of this as anything other than a bearish sign for Grok though.
That's very doubtful given recent news that Colossus is running at 11% capacity and has hundreds of thousands of idle GPUs. xAI acquired too many GPUs and currently doesn't have enough customers to use them. That's why they are making compute deals with Anthropic and Cursor.<p>xAI is bleeding money and this compute deal with Anthropic will pay for all of xAI's capex ($25 billion) in 2 years.
11% MFU does not mean 89% of GPUs are idle, it means that they're using the GPUs ineffectively.
> will pay for all of xAI's capex ($25 billion) in 2 years<p>This is a confusing framing; you pay down capex with profit not revenue, and there is presumably a high opex cost.
Right, also Anthropic has been having difficult time getting more GPUs
He believes in the value of the idea of “space compute” for attracting investors to SpaceX. But the existence of the idea of “space compute” as a better way to deploy datacenters (along with everything else Musk has claimed in the past decade) should give everyone pause as to the plausibility of literally everything else he says.
We could see the first company vertically integrated from etching to chip to data center
That's Intel. Probably IBM too, though they've been doing mass manufacturing with TSMC (and GloFo before) for years instead of their fabs. I wouldn't be surprised if HP did similar things back in the 80s.
What do you mean by etching? Google does also it's own chip design with TPUs, data centers, and models but afaik only TSMC Intel and Samsung do the actual semiconductor fabrication
Here's a probably stupid question - if someone were unbounded by ethics and conceivably had enough power and connections to power to shield themselves from many consequences of their actions - and that person owned these DCs, could they in theory observe all the streams of tokens coming in and out of these models, and even exfiltrate copies of these models wholesale to have their own teams do what they will with them in the pursuit of building their own competitive models?<p>Or is there something fundamental in the way these models get deployed (encryption or something or than legal contracts?) at this scale that prohibits the owners of the infra from gaining this level of insight / access?
1) The situation you described would be covered under the contract between Anthropic and xAI, and that any violation of that would be subject to financial penalties and legal proceedings. The US has a robust corporate legal system, and disputes do get resolved through the court system, although in a slow and costly manner.<p>The contract can stipulate a penalty at a high enough amount to discourage this behavior.<p>2) Output from models & intra-datacenter communications can be encrypted if customers truly cared.<p>3) There is no reason do this, because there are far better ways to exfiltrate data from Anthropic models. Chinese companies are already doing this at an industrial scale where they are reselling Claude tokens for 10-20% of the cost while retaining the data to train their own models. <a href="https://www.chinatalk.media/p/how-to-buy-cheap-claude-tokens-in" rel="nofollow">https://www.chinatalk.media/p/how-to-buy-cheap-claude-tokens...</a><p>If we look at Deepseek V4-pro, created by Deepseek who Anthropic formally accused of harvesting Claude tokens at scale, it performs the same as Claude did 6 months prior.
> The US has a robust corporate legal system<p>Thanks for the chuckle. ;)
I hope the Chinese keep harvesting Claude etc. since they stole all their data anyway, who cares?
I guess there's a reason why those Chinese companies are in china
It's already in the public domain (thanks to the OpenAI trial) that Grok distilled OpenAIs models. Listening to the data going into the models in the data centre would be very similar thing. There's some downsides (you're passively listening, not controlling the queries), and some upsides (way more data). But it only ever gets you to some percentage of the existing production model. It doesn't get you what Musk wants - an AI company capable of designing and deploying leading edge models. It gets you to fast follower status.
You could, but Grok is pretty high up there, it might not be "#1" but its definitely up there with the giants, people seem to overlook it. Gemini has a similar problem, it was #1 once, and it seems like Google isn't hell bent on chasing #1 they just want to keep iterating over time, they know they just need it to be "good enough" and they'll keep having repeat customers.<p>If Elon REALLY wanted to do anything like that he would be better off poaching talent from competitors, less legal hell to go through.
If I was training a top-tier model, having a competitors’ weights feels like it would be an excellent refining tool. As a user I find cross-model iteration to be a huge power-tool, and presumably the boffins can zero in on areas of relative strength and weakness and work out which area they want massive amounts of synthetic data from.
xAI had a lot of negotiating power here because Anthropic had ~0 comparable options and ultimately desperately needed the compute <i>now</i>. So, it wouldn't surprise me if data sharing was an explicit part of the agreement
What prevents a data center operator from reading your chats? [FEATURE] Provide a way to select your data center #56916 <a href="https://github.com/anthropics/claude-code/issues/56916" rel="nofollow">https://github.com/anthropics/claude-code/issues/56916</a>
There's accusations that the Chinese labs have done essentially that to OpenAI and Anthropic and exfiltrated their models without having DC access, so if you had DC access, yes, you could do that. If you had DC access though you could just copy the model onto an SSD.
Aren't Anthropic afraid of Elon siphoning the model weights out from the network buses?
Is xAI a competitor worth worrying about?<p>They make good models, at times SotA (at least if you don't need coding, their last good coding model was six months ago), with lower safeguards than either Anthropic or OpenAI, and they still fail to capture meaningful market share or mind share. The name Grok is tainted by the twitter bot of the same name operated by xAI/X. Being owned by Musk lets the company appear unstable and untrustworthy in the minds of many. Their marketing game is just bad all around. They struggle to retain top talent.<p>Maybe their next model will be great. I doubt it will matter. I doubt xAI siphoning off Anthropic models and distilling that would matter. Model performance is not the main factor dragging down xAI
Theft of trade secrets. And so many people will have to be involved that evidence of the crime is bound to leak out.
Pretty sure models are encrypted all the way.
Can't run inference on encrypted weights and get any kind of performance out of it.
Dude, Chinese labs distil attack via the <i>APIs</i>, if Musk wanted to do something like that, technically he could. Legally it would be a giant slam dunk liability though
I think that's the datacenter with the gas turbine generators that operate without permits because they're "portable." Data centers have tremendous externalities but colossus is a particularly nasty offender, and not just due its size.<p>Edit: They did it with Colossus and now they're doing the exact same thing with Colossus2. <a href="https://www.selc.org/news/xai-built-an-illegal-power-plant-to-power-its-data-center/" rel="nofollow">https://www.selc.org/news/xai-built-an-illegal-power-plant-t...</a>
The newer location is about 3 miles southwest of the Memphis Airport (MEM), one of the world’s largest cargo airports and the center of FedEx operations (500 take-off and landings per day most concentrated in a 6 h FedEx window with lots of engines running on ramps and that produces about 2000 tons of NOx per year).<p>I live about 18 miles downwind of the new Colossus sites, the airport, and lots of truck logistics sites, and a large refinery.<p>I definitely will be getting 2x exposure to ozone and particulates from both Colossi when they are running full bore. Plus an extra dose of ultrafine particulate with my morning fresh air.<p>Yes, wouldn’t it be nice to be in Nashville instead with HCA, Oracle, many insurance and financial institutions, and the joy of country music.<p>As an avid Opus user I am in an ethical Nimby bind. We do need almost any investments we can get in Shelby County TN. I’ll take Anthropic in preference to Grok NOx. And it will be my NOx.
The biggest issue with the interim onsite generation is the lack of meaningful stack height on the generating units.<p>Airplanes by virtue of their mode of operation stay out of the unhappy regime most of the time. Also, engines at/near idle produde orders of magnitude less emissions. Those aeroderivative generators are running at full capacity 24/7.<p>Dumping exhaust at ground level continuously is probably much worse than the airport. Even if it's a FedEx world hub.
> I’ll take Anthropic in preference to Grok NOx<p>It's the same datacenter? Ran by the same people?
Hey Siri - can you please order this guy a spare set of lungs ?
Your math is way wrong. The airport is and will be far, far worse. You didn't even mention all of the lead
So for a guy that literally has a company that produces batteries and solar panels, choose to use gas turbines. So much for saving the planet.
Solar and batteries are a bad choice for a onstant 24/7 load.<p>That's the exact reason we will never go fully solar (or wind) unless an insanely impressive battery breakthrough makes storage effectively free while using only common, renewable components rather than rare earths.<p>Solar, wind, etc are excellent parts of an energy system, but its nearly impossible to cover base load at scale with generation that may only run for 0-5 hours a day.
He is building the skill tree in such a way that he is prioritising speed rather than environment.
I dug into this topic in some detail on my blog and it's both enraging and depressing.<p><a href="https://poiesic.com/posts/pattern-recognition" rel="nofollow">https://poiesic.com/posts/pattern-recognition</a>
This is a really great watch from Benn Jordan on the topic <a href="https://www.youtube.com/watch?v=_bP80DEAbuo" rel="nofollow">https://www.youtube.com/watch?v=_bP80DEAbuo</a><p>Some wild things happening with those, and infrasound. Colossus is shown 4 mins in
I dont know, Id say the enraging thing is that the government is so incompetent and unable to expand electricity supply that datacenters are forced into using loopholes to get power the only way they can.
That isn't a problem of inept government, its a problem of over regulation and what amount to state-sponsored monopolies in many areas.<p>We don't need the government to fix it by expanding power grids from the top down, we need free markets allowing competition.
> Id say the enraging thing is that the government is so incompetent and unable to expand electricity supply<p>So let's say you're a homebuilder, if I tell you I want a new home and I want to live there tomorrow, you can all of a sudden build it in a day, right?<p>Electricity use is skyrocketing for various reasons, these datacenters being one of them. There are a lot of countries struggling to keep up with demand. So incompetence? No, probably more like supply lagging demand.<p>Or ASML and Nvidia and all also are incompetent, because they didn't see demand coming....
In the early days of this the AI companies were asking for massive new energy supplies but also refusing to sign contracts to pay for it over the decades of its life.<p>They're basically attempting to game the system, politically and economically, to put as much of the cost on taxpayers and ratepayers as they can. This naturally slows things down.
If only there was some sort of planning, by a central authority!
These are the same companies and individuals who are actively working to destroy functional government, and are happily looting the US treasury rather than let it be spent on things such as encouraging more energy production.
Seems like selc's time would be better spent trying to close the loophole that allows for unpermitted turbine generators instead of going after one company for doing what they were allowed to do when they did it.
this is why ai in space will win
Yup, and now Anthropic is complicit in the environmental damage and health problems for local residents that these data centers are causing.<p>But hey, number must go up, right?
Have you considered that the march of progress requires human blood to grease the gears and mulched skulls to pave the (highly efficient) road? Really, when you take into account all of the future lives this will improve and save it's difficult to claim any cost now is too high. Would you stand in their way and delay the day that Mythos cures cancer?<p>This is a joke. Read it in a mocking tone.
<a href="https://www.newyorker.com/cartoon/a16995" rel="nofollow">https://www.newyorker.com/cartoon/a16995</a>
I wonder what percentage of GDP expenditure will give us SkyNet.<p>Undoubtedly, it will find cures to all cancers… The ARR and stock appreciation will be amazing. Except the cures will be found long after it has wiped out all humans.
Not Anthropic, but Sam Altman - AI will solve climate change and cure all diseases.
My favorite claims are that it will solve both aging and death, whatever that means.
AI is the new religion, and one needs to be stupid to believe it.
Already so many people are treating it as a higher being, believing whatever that comes out of it
That implies you don't need to be stupid to believe the other ones.
I'm not <i>saying</i> human blood and mulched skulls are a renewable source of power, I'm just <i>saying</i>. Or maybe they can partner with SoulCycle to power computation with 24/7 spin classes?
Per sanguinem ad astra
I loled
When do we start building pyramids and doing the Sardaukar blood letting ritual?
Some of you may die, but it’s a sacrifice that I am willing to make.
Do you think Boris cares about people getting cancer and dying from these data centers? No, he cares about becoming rich as fuck.
Given how much our EPA has been gutted by the current administration, I don’t think relief is very likely.
So much for Dario’s ethics. He happily partners with Elon. He seems like just another power hungry monopoly seeking liar.
That’s because he is. None of these people are your friends and all of them will fuck you over if it means getting richer and more powerful.
> So much for Dario’s ethics. He happily partners with Elon. He seems like just another power hungry monopoly seeking liar.<p>Dario has been glorified unnecessarily. He's just like all the other people in the space: not good, not bad.<p>And keep in mind that when Dario was opposing AI usage by the US State he wasn't really opposing, he was just saying "not yet".
xAI’s turbines produce meaningful local/regional pollution (especially NOx in a vulnerable area) but represent a rounding error nationally and globally.
> xAI’s turbines produce meaningful local/regional pollution (especially NOx in a vulnerable area) but represent a rounding error nationally and globally.<p>If you shoot someone in the face, it will produce a meaningful increase in local/regional murder, but represent a rounding error nationally and globally.
No one should drive any kind of vehicle because they cause accidents.
Gave me a chuckle on my commute, thanks!
It doesn’t matter if people have to suddenly live by gas turbines that run 24/7 because why again? Can you repeat that last part back to me but say it a little dumber for me?
multiply rounding errors by thousands and you get somewhat meaningful impact. you are underestimating the scale of independently small pollutions
farting in a crowded elevator because the people outside the elevator won't even notice
What's the tremendous externality of gas generators? People heat their own homes with natural gas and it's no big deal. How can a datacenter that is miles away be worse than that?
How can something that is a million times bigger than your home be any different, right?
The gas furnace in my basement don't have a massive jet turbine emiting high frequency noise
It's the low frequencies that's more of an issue apparently. Benn Jordan has a great series of videos about it, including one on Colossus
I wouldn't call noise pollution a "tremendous externality". The gas turbines should just be placed far enough from where people live.
Why is xAI giving up their advantage? Is this a signal that their frontier model improvements are plateauing and decided there is no value in hoarding all their compute?
I would guess it's purely because Grok isn't nearly in-demand enough to produce meaningful revenue. And they want to juice the numbers for IPO<p>And I'm sure it's a bonus point for Musk that it goes to OpenAI's most relevant competitor
As weird as it seems I think this is Musk’s best shot at winning over Altman. He has personal vendetta.
xAI have (with some questionable ethics) managed to actually build a data centre, so they have a ton of compute but not much inference demand for their model which is second-tier.<p>Everyone else trying to build data centres is really struggling (turns out building physical things is not as easy as writing code, who knew).<p>So Anthropic have the model but they're compute starved because everyone else they've signed agreements with still mostly have piles of dirt and the GPUs are still in Nvidia's warehouse somewhere.<p>It's a bit of a win-win: xAI's financial numbers will be massively improved by the revenue using otherwise useless data centre capacity, Anthropic get the compute they desperately need albeit probably paying through the nose for it
xAI advantage is that it's not censored, that's why people use Grok
Elon got rid of most of the core xAI researchers recently. It looked like firings and he said something like Grok needs to be rewritten because it was fundamentally built in a bad way. My guess - Grok was not one of the top two models and had no traction beyond users on Twitter - so investing in it did not make sense. Or maybe he needs time to build a new team and rebuild Grok, and while he’s doing that, he needs revenue to make up for all the GPUs they bought.<p>Either way, I doubt he has any ‘real’ advantage in this game. It’s OpenAI and Anthropic, and then everyone else including the open weight models.
When did xAI have an advantage?
I think they overestimated the demand for Grok, which is mostly useless, and now they have too much compute on hand.
I see this as a huge warning sign. If a frontier ai lab is in this position of renting their own capacity, imagine how much overcapacity there is in the system.<p>Outside of VC money, and circular financing, the only external money coming into ai are into open-ai, and anthropic via their subscriptions and APIs.
What advantage? Has there ever been any indication they’re leading in any segment? Sure Elon has thrown a bunch of money at hardware, but to what end?<p>And frankly as bad as Altman is from a: if AI is really going to disrupt humanity do I want this guy in charge? Elon is 10x worse. So why would the best and the brightest ever work for him?
No other LLM has made as much child porn as grok so there is that...
In a compute starved world, big ass data centers are an advantage.
yes, but it's only advantage if one is compute-strained and the other isn't. if they both have lots then there's no advantage. if one doesn't fully utilise their compute then it's not an advantage either
can you elucidate what that advantage is, that isnt renting it out for the highest price to somebody that really needs it?
Well, other than your ability to turn that into cash by renting it out for the highest price to someone who needs it, you can promise prospective employees that are supposed to use that infra to train models that they won’t be compute starved.<p>You can kick off more model training runs and experiments than your competitors.<p>You can kick off a $1-2t IPO claiming you are going to capture a large portion of the largest TAM the world has ever seen.
Training a model that is larger than your competitor's.
The datacenter advantage, obviously
More signs that xAI might be giving up on the AGI race. xAI let Cursor train a model on Colossus 2, gave the entire Colossus1 to Anthropic, and is now giving compute in Colossus2 to Anthropic as well.
Bad read on the situation. xAI has too much compute and not enough customers using it. They have around half a million GPUs, some of which are stolen from Tesla, running at 11% utilization. xAI predicted more people would be using Grok, but Grok is not a SOTA model & users primarily want to use SOTA models. They have excess capacity and it makes sense to rent out GPUs to other customers while they improve their models.
Grok is also tuned to align with Musk's personal beliefs. I wouldn't touch it with a 10 foot pole.
It is a race that has a flywheel effect.<p>Once xAI training team “fix” their model, where will Anthropic be then?
Why are they selling compute instead of using it to build that SOTA model?
They tried and failed. xAi made a mistake building Colossus 1 and ended up with heterogenous cluster of H100/H200/GB200 GPUs. This is a nightmare to train huge models on because each card has different specs, features, and hardware requirements. During gradient synchronization, a heterogeneous cluster would bottleneck on the slowest GPU (H100) so the faster GPUs would end up idling. They also probably ran into unexpected compatibility issues, which are difficult to resolve.<p>It makes more sense to use this cluster for inference, since they can segment the cluster by GPU type and avoid GPU mixing. xAI doesn't have enough inference customers so it makes sense to monetize this to companies that need inference compute such as Anthropic or Cursor.<p>Apparently xAI will try building SOTA models on Colossus 2, which will be built on Blackwell GPUs only.
It's not stolen if it was taken from Tesla, investors already agreed that Elon can do anything he pleases with their money.
More people should try Grok. I don't use it for coding but it's replaced a lot of my ChatGPT usage. Definitely more perferred model for quick questions or easy answers.
One thing I do like about Grok is that it makes it stupid easy to see what its referencing, and gives you the links to those resources. Which most models sometimes either don't bother, or don't do much of a good job of doing. It's not the top model, but it is definitely high up there, people's blind rage for anything Elon Musk is the only reason most people don't realize how capable it is unfortunately. Grok is not exclusively made by Elon Musk, there's definitely other engineers working day and night on it.
For conversational or general knowledge questions I also much prefer Grok. Musk's vanity aside, it is much less censored than the other frontier models.
What's the blind rage, he's totally out in the open.
Elon lost his lawsuit with openAI and knows xAI isn't on the same trajectory. Might as well try to win the bet and flip off Sam by supporting the best competition. Also they are getting a head start on AI as a commodity. I'm sure there's plenty of money to be made for those that can leverage their capital to essentially rent capacity right now. If he's not making enough off of grok, might as well cover their expenses.
It was kinda obvious when SpaceX "acquired" it. Elon rewarded xAI investors/prevented lawsuits by giving them SpaceX equity, and that was that.
FWIW, SpaceX (parent company of xAI) has an option to acquire Cursor for $60B that expires 7 days after their imminent IPO.
xAI might acquire Cursor. They are in the process of training new coding models and probably a new Grok.<p>Until they finish training, it makes sense to rent the excess capacity.
I don't see a scenario where it really makes sense to be a frontier lab long term. Eventually model quality will plateau then you distill and get 90% for 10% or less cost.
General AI is that scenario. The investor dream is that their horse hits general AI first, patents it (or otherwise somehow stops the competition from hitting it), and then reaps the massive benefits.<p>I'm not saying it's a <i>likely</i> scenario, but I genuinely believe a big percentage of AI investment revolves around that (or similar) scenarios.
Opus and GPT are so different there’s room for both and I wouldn’t be ignoring Gemini even if it isn’t <i>ahem</i> great at coding, since it’s quite obviously very good otherwise.<p>In the times before you also would rather have very smart people working together instead of one very smart dude alone even if he had an identical twin.
Plateau on a saturated benchmark where an asymptote to 100% is mathematically baked in?<p>Or plateau as in it won't solve any Millennium Prize problems within the next decade?
Over the past 6 months, Anthropic has made more waves as a product company than a frontier lab.
This might come down to when you expect plateau to happen. You could have said similar about transistor density many decades ago.<p>(I'm not denying it could happen next year for all we know. But we simply don't know, and from what I hear from researchers the breadth of ideas we've tried are still small)
Ok, maybe this question is a bit silly, but could it possibly be that Elon is doing this to steal Anthropic models secrets and using them to improve Grok?
No. Model weights are encrypted. Elon is doing this because Anthropic is desperate for compute, SpaceX needs to juice up its balance sheet before IPO, and xAI model team isn't competitive.
The model <i>weights</i>, sure he can "steal" them. But do what then? Serve it on the side?<p>Even distillation would be obvious.<p>And I wouldn't be surprised Anthropic is running the smaller inference models, keeping the base large model in machines they fully control/own.
SpaceX's data centre business is much more valuable than Grok, so this wouldn't make sense.
<a href="https://x.com/nottombrown/status/2057194829986300375?s=20" rel="nofollow">https://x.com/nottombrown/status/2057194829986300375?s=20</a>
I use Claude daily but I do not want that my spend is going towards Elon.
War makes strange bedfellows.
Does an expansion of computing power on this scale imply that computing capital is displacing model architecture as the true moat in AI competition?
How come a company like Anthropic has invested in photonic computing? If it's good enough for Boeing, I'd assume they would at least invest in it. qc-LPU100 seems worth it for some matrix mult, if it can be proven its O(n) (at least less than O(n^3).
Sigh.<p>I’d hoped Anthropic would steer clear of blatantly unethical practices but here they go in bed with that guy and his horribly damaging data center.
Anthropic works with Palantir, they are all but "ethical" lol.
Yes, quite a bad reputation hit for Anthropic to get in bed with Musk. Tesla lost half its marketshare in Europe because Elon is meddling in our democracy, is promoting right wing populist parties and supporting Trump in general.
Europe has a hugely shrinking demographic, and is actively decoupling from the United States. There's almost no innovation and you are making the mistake of getting in bed with China and constantly suing our tech companies.<p>Europe needs to focus more on Europe and less US politics.
No, they’ve lost market share because they haven’t released a new product in years. Meanwhile China is releasing hundreds of excellent models into the European market which are better than Tesla’s.
Musk said Anthropic Claude was woke DEI until he said it wasn't. It must be hard for Musk fans to keep up.
Seems like either Grok is being shut down or it will be "powered by anthropic" soon.
I predict SpaceX will subsume Anthropic at some point.
Related:<p><i>SpaceX S-1</i><p><a href="https://news.ycombinator.com/item?id=48213933">https://news.ycombinator.com/item?id=48213933</a>
Anthropic is gross for this. The grandstanding about principles and values is intolerable.
Too bad Enron is still not around. They'd have some real fun with today's electrical markets.
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I though Claude is too woke. Musk has posted that at least 50 times in the last year.<p>But booking outrageous rental fees as fake AI revenue ahead of the SpaceX IPO apparently takes precedence.
He posted that AI will kill everyone, then stopped posting that when he started his own AI company.<p>He tried to steal the OpenAI charity, then started complaining about someone else stealing the OpenAI charity when he failed to do it.<p>He attacks European democracies about free speech, but is a compliant little censor for Turkey, India and other non-European countries.
Anthropic is paying real cash, how is it fake revenue?
He talked with the Anthropic team, and his concerns lessened. It's actually a good thing to be able to change one's mind.
You’re falling for the Musk shell game. He just says whatever is convenient at any given moment. FSD. Funding secured. I talked to the Claude guys.<p>He didn’t change his mind about anything. It’s just that he wants to prop up SpaceX’s IPO as much as he can. Plus if he hits various targets, he unlocks more shares for himself, I think.
The eternal truth: money talks, bullshit walks
Musk will buy Anthropic and fix the wokeness. It was done before.
Cool. Can they make Claude not absolute dogwater then?