xAI is looking more like a datacentre REIT than a frontier lab

An unexpected development over the past few weeks is xAI's new partnerships with Anthropic and Google, providing them with a huge amount of capacity. It's worth remembering that xAI is now part of SpaceX, after the two merged back in February - so the revenue from these deals flows straight into the entity about to go public. While much has been made of the potential financial engineering given SpaceX's upcoming IPO, I think there's a bit more to this than just pure accounting tricks. Anthropic was in a serious bind If you use Claude products much, you'll be (very, probably) aware that Anthropic has had serious capacity problems, especially early afternoon onwards in Europe and in the mornings in the US (this is when demand seems to be highest as both European users and the Americas are both at work, fighting for capacity). I've written about this compute crunch before a few times - the coming crunch, whether it's here yet, and what comes next. This resulted in Anthropic having to…