The Wall Street Journal reported that SpaceX showed a small group of investors a prototype of a pocket-sized artificial intelligence device. The device is said to be thinner than an iPhone. It is expected to run on its own operating system and rely on technology from Musk's company xAI. Elon Musk immediately dismissed the entire report as complete nonsense. And that is precisely what sparked debate, because the billionaire has previously denied things that ultimately turned out to be true.
According to the newspaper, SpaceX demonstrated an early version of the device to selected investors and partners before the company went public in June. The prototype reportedly has a thin design that the WSJ describes as slimmer than an iPhone. Inside, it is said to feature a Qualcomm Snapdragon chip, while the entire device is expected to be powered by an operating system developed by SpaceX itself.
The main attraction is said to be artificial intelligence from xAI. The company acquired it at the beginning of this year when it brought the firm under its wing. However, the WSJ does not elaborate on exactly how the AI would be integrated into the system or what it would be able to do beyond an ordinary phone.
The newspaper's sources also cautioned that the project is at a very early stage. The design could still change significantly, and it is far from certain that the device will ever go on sale. TechCrunch estimates that the result could be something between a small touchscreen phone and a gadget like the Rabbit R1.
Musk's denial and his history
The response was not long in coming. Musk wrote on X just two words, calling the report completely false. He thus categorically denied that SpaceX was preparing an AI device with its own operating system, as well as the claims about a pocket-sized device thinner than an iPhone.
But this is where we run into a problem. This is not the first time Musk has denied something that ultimately came true. Tom's Hardware points to April 2024, when Reuters reported that Tesla had canceled the inexpensive Model 2. Musk snapped back at the time that Reuters was lying again. However, the affordable electric car in its originally planned form never materialized, with the company instead betting on the Robotaxi and virtually ceasing to mention the Model 2 in subsequent conference calls.
Musk had already commented on the subject of a phone before. In February this year, Reuters reported that SpaceX was working on a smartphone and had been considering a handset for years. Musk said at the time that a hypothetical Starlink phone was not out of the question in the future, but that it would be a device built around artificial intelligence and would differ greatly from today's phones. At the same time, he denied that the company was building a phone. According to his latest statement, SpaceX is not developing any device.
Why would SpaceX make such a device?
The company has the manufacturing infrastructure for it. Together with its sister company Tesla, it is capable of mass production and has access to the chips needed to power such a device. SpaceX has also long hinted that it wants to enter the mobile network market. The Starlink Mobile service is aimed directly at carriers such as Verizon and AT&T. One analyst even speculated that T-Mobile or AT&T itself could be an attractive acquisition target for the rocket company, although such a deal would be extremely expensive.
Building a phone that connects to both Starlink satellites and terrestrial 5G networks is technically feasible. There are 3GPP specifications for so-called non-terrestrial networks, and many current devices can already at least send text messages via satellite. However, Tom's Hardware points out a catch. Building a modem and receiver that strike the right balance between performance, reliability, size, and power consumption is a major challenge. And the satellite constellation itself must provide enough transmission capacity to support global operations.
An ego battle may also be lurking behind it all. OpenAI is working with Apple's former chief designer Jony Ive on its own AI device, which Altman claims will be calmer than the iPhone. Reports from last fall suggested that the company was struggling to fine-tune the details, and last week came news that Paul Meade, Apple's vice president responsible for the Vision Pro headset, had joined OpenAI's hardware team. If OpenAI is doing it, Musk would probably want to try it too—and do it better than them.
The crowded graveyard of AI devices
Enthusiasm should be tempered. The market is flooded with phones, they are made by numerous manufacturers, and all of them have access to every existing AI model, including xAI's Grok, which critics have so far received rather lukewarmly. Wanting to sell an AI device and wanting to buy one are two different things.
History is also full of failed launches. Companies such as Humane and Rabbit released their AI gadgets to great fanfare, only for them to end in disgrace. A new device would immediately put SpaceX in the ring against Apple, Google, Samsung, and other companies. That is not a rivalry a company CEO would want to acknowledge, especially for a product still in its infancy and shortly after going public.
