Jamie Spencer
Elon Musk’s AI startup, xAI, introduced its latest Grok-3 model, positioning it as a challenger to OpenAI’s GPT-4o and other leading AI models. The announcement came just days after Musk’s $97.4 billion bid to acquire OpenAI’s nonprofit arm was rejected.
Grok-3 Performance and Features
According to xAI, Grok-3 surpasses OpenAI’s GPT-4o, Google’s Gemini, DeepSeek’s V3 model, and Anthropic’s Claude in math, science, and coding benchmarks. It utilizes “more than 10 times” the compute power of its predecessor and completed pre-training in early January.
Musk also announced the launch of DeepSearch, a smart search engine that incorporates reasoning capabilities and allows for research, brainstorming, and data analysis. Additionally, xAI plans to introduce a voice-based chatbot.
Subscription and Open-Source Plans
Grok-3 is available to Premium+ subscribers on X for $22 per month, significantly lower than OpenAI’s $200-per-month GPT-4o subscription. xAI also announced a new SuperGrok subscription for mobile and Grok.com users. Musk intends to open-source previous Grok models once Grok-3 reaches full maturity in the coming months.
Expert Reactions and Evaluations
Andrej Karpathy, an OpenAI co-founder no longer with the company, shared initial impressions on X, stating that Grok-3 “feels somewhere around the state of the art territory of OpenAI’s strongest models.” However, he noted issues with factual accuracy and performance in specific tasks, emphasizing the need for further evaluations.
Funding and AI Competition
xAI is reportedly in talks to raise $10 billion, valuing the company at approximately $75 billion. OpenAI, meanwhile, is seeking up to $40 billion in funding, potentially pushing its valuation to $300 billion.
AI infrastructure investment is also intensifying. SoftBank, OpenAI, Oracle, and MGX have committed to deploying up to $500 billion for AI infrastructure, while Dell Technologies is negotiating a $5 billion deal to provide xAI with AI-optimized servers.
Emerging AI Competition
China’s DeepSeek recently released R1, an open-source AI model that competes with leading U.S. models at a fraction of the cost. This suggests new entrants could challenge the dominance of major AI companies like OpenAI and xAI.
As AI competition intensifies, xAI’s Grok-3 aims to establish itself as a serious contender against OpenAI. With significant funding and evolving technologies, the AI landscape continues to shift rapidly.
