SpaceX's Starship rocket, due to launch in 2026 from Florida, is key to deploying satellites for orbital data centers needed for Musk's AI goals.

Elon Musk's mega-merger of his companies xAI and SpaceX this week brings this sci-fi dream a step closer. NASA engineers and technologists have speculated for ​nearly two decades about moving energy‑hungry computing off the planet.

The list of broken promises Musk has made about fantastical technological achievements leaves a lot of room for doubt.

The tie-up of SpaceX and xAI is all about a plan to dominate space with artificial-intelligence data centers, according to Elon Musk, who founded both companies. It won’t be cheap. Analysts at MoffettNathanson crunched the numbers and concluded “the capital needs would be simply enormous” and require “a staggering amount of external financing.

The IPO is expected to generate tens of billions of dollars, giving xAI a new source of funds. Musk also says the arrangement is meant to pave the way for space-based data centers, days after SpaceX filed a plan to operate up to one million satellites for the project.

Starship, the world's largest rocket that launches in Texas, could play a vital role in SpaceX founder Elon Musk's vision of orbital data centers.

Some analysts say it's not a stretch to think the struggling EV maker is, as Musk himself has said, "trending towards convergence."

Elon Musk believes the best way to solve the difficulties of building AI data centers on earth is to move them into outer space. His merger this week of his rocket company SpaceX with his artificial intelligence company xAI could help get them there.