Elon Musk’s artificial intelligence startup, xAI, is reportedly in advanced discussions to lease significant data center capacity within Saudi Arabia. This strategic move aims to bolster xAI’s infrastructure in a region known for its affordable energy resources and favorable political environment.
According to reports, xAI is engaged in early-stage talks with two potential partners in the Kingdom. One of these is Humain, a Saudi-backed AI firm, which is offering several gigawatts of data center capacity. The other prospective partner has a smaller, yet more immediately available, 200-megawatt facility.
Rather than building and owning its own data centers, xAI’s approach involves renting capacity in these existing or developing facilities. This model would allow xAI to power its burgeoning AI models efficiently and scale operations as needed.
The discussions underscore xAI’s rapid expansion and its need for substantial computing power to develop and run its sophisticated AI technologies. Saudi Arabia’s appeal lies in its abundant and cost-effective energy supply, a critical factor for energy-intensive AI operations. The nation’s growing interest in technological advancement and its efforts to diversify its economy also present a conducive environment for such partnerships.
While the specifics of the agreements are still being ironed out, this development highlights the global race for AI infrastructure and the increasing importance of strategic locations for large-scale AI development.
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