Musk's Memphis AI empire

PLUS: Instagram launches Rings awards

AuthorAuthor

Jennifer Mossalgue & Rowan Cheung
October 07, 2025

Good morning, tech enthusiasts. Elon Musk is dropping $18B on Nvidia chips to fuel what could be the world’s most powerful supercomputer, right outside Memphis.

His AI startup, xAI, is burning cash at a staggering rate, promising jobs, but stirring tension in nearby communities. The question is, can you really buy your way to the top of the AI race?

In today’s tech rundown:

  • Musk bets $18B on Memphis supercomputer

  • Instagram awards creators with gold rings

  • Anthropic’s largest enterprise deployment ever

  • AstraZeneca’s $555M bet on CRISPR AI

  • Quick hits on other tech news

LATEST DEVELOPMENTS

XAI

Image source: xAI

The Rundown: Elon Musk's xAI is committing $18B to buy hundreds of thousands of Nvidia GPUs for its Colossus 2 data center in Memphis, according to the Wall Street Journal — marking the latest push to outpace rivals as local resistance stacks up.

The details:

  • xAI reportedly will purchase 300K additional GPUs from Nvidia, bringing Colossus 2's total to around 550K chips in what amounts to at least $18B.

  • To address the massive cooling demands of the facility, xAI is investing $80M in wastewater treatment facilities to recycle millions of gallons of water daily.

  • Locally, xAI has become Memphis’s second-largest tax contributor after FedEx, promising hundreds of jobs and staking Memphis’s claim as a high-tech hub.

  • xAI announced in July that it had begun installing computing infrastructure for Colossus 2, with completion expected by 2026.

Why it matters: Musk’s AI push has fractured Memphis, triggering backlash over its thirst for more than a gigawatt of electricity and millions of gallons of water daily, with environmental groups and residents — especially in long-marginalized Black neighborhoods — raising alarms about pollution and grid strain.

TOGETHER WITH AUGMENT CODE

The Rundown: Augment Code's powerful AI coding agent and industry-leading context engine meet professional software developers exactly where they are, delivering production-grade features and deep context into even the largest and gnarliest codebases.

Augment’s context engine lets you:

  • Index and navigate millions of lines of code

  • Get instant answers about any part of your codebase

  • Build with the AI agent that gets you, your team, and your code

INSTAGRAM

Image source: Instagram

The Rundown: Instagram just launched ‘Rings,’ a new award that crowns 25 standout creators with a hefty gold ring and a matching digital badge. Winners will be selected by a jury that includes Adam Mosseri, Spike Lee, and Marques Brownlee.

The details:

  • “This award is for the creators who don’t just participate in culture — but shift it, break through whatever barrier holds them back,” Instagram said in a release.

  • The launch follows Meta’s 2023 shutdown of its Reels Play bonus program on Instagram and Facebook, a major income stream for many creators.

  • No cash prizes, but winners get a gold ring and also gain the ability to change their profile backdrop color and personalize the “like” button.

  • Rivals YouTube and TikTok still offer revenue‑sharing, with YouTube paying creators over $100B in the past four years.

Why it matters: These rings mark a shift in how Instagram, at least, defines influence, prioritizing cultural relevance over raw numbers. It’s a move to legitimize creators as tastemakers, not just content machines. Still, Instagram’s gold rings feel more like a symbolic nod than tangible support in a tightening creator economy.

ANTHROPIC

Image source: Anthropic

The Rundown: Deloitte is going all‑in on generative AI, announcing a massive rollout of Anthropic’s Claude assistant to more than 470K employees across 150 countries, in Anthropic’s largest enterprise deployment ever.

The details:

  • The integration spans consulting, audit, tax, and advisory divisions, weaving Claude into daily workflows for research, client deliverables, and analysis.

  • The move follows Anthropic’s release of Claude Sonnet 4.5, which it says offers stronger reasoning and faster response times for enterprise users.

  • It reflects growing trust in “constitutional AI,” models with built-in safety rules to minimize hallucinations and risky outputs.

  • At the same time, Deloitte is under scrutiny after a welfare compliance report for the Australian government included multiple AI-generated errors.

Why it matters: This is a high-stakes test of whether “constitutional AI” can meet the strict demands of domains like auditing and consulting. Another big question: will clients — and regulators — accept AI-assisted work as being as reliable, accountable, and standards-compliant as the human-only version?

BIOTECH NEWS

Image source: Declan Sun / Upsplash

The Rundown: AstraZeneca inked a $555M licensing deal with San Francisco–based Algen Biotechnologies, gaining exclusive rights to develop and commercialize gene therapies discovered via Algen’s AI‑powered gene‑editing platform.

The details:

  • Algen’s proprietary AI platform, AlgenBrain, uses advanced CRISPR gene modulation to map gene function to disease progression at the single-cell level.

  • The company was spun out of Nobel laureate Jennifer Doudna’s UC Berkeley lab, aligning cutting-edge CRISPR gene editing with AI-driven discovery tools.

  • AstraZeneca will obtain exclusive rights to develop and commercialize any therapies arising from the targets identified through the partnership.

  • The deal supports AstraZeneca’s strategic goal to expand its cell and gene therapy pipeline as part of its $80B revenue target by 2030.

Why it matters: Pharma is placing billion-dollar bets that AI can solve drug development's tough economics — 90% failure rates and decade-long timelines — by surfacing biological insights humans would miss. But computational predictions still need to survive the gauntlet of human clinical trials, where biology has the final say.

QUICK HITS

Elon Musk appointed former Morgan Stanley banker Anthony Armstrong as the CFO of both xAI and social platform X.

Apple faces an investigation by French prosecutors over its collection and handling of voice recordings captured by its Siri assistant.

Chinese maritime equipment firm Highlander is developing one of the world’s first commercial underwater data centers to slash energy consumption by about 90%.

Tesla is set to unveil a more affordable version of its best‑selling Model Y SUV today, a move aimed at boosting sales and regaining market share as the EV sector heats up.

Amazon founder Jeff Bezos, appearing at Italian Tech Week in Turin, predicted that millions of people will be living in space within a couple of decades.

Health tech startup Heidi Health announced a $65M Series B funding for its AI health scribe that takes notes and calls patients for doctors.

Wind and solar power generated more electricity worldwide than coal plants this year, for the first time ever, signaling a turning point for the global energy system.

Microsoft is buying 100 megawatts of solar capacity in Japan through three 20-year power purchase agreements, aimed at powering data centers in the country.

The UK’s NHS is building a cloud platform to rapidly test AI screening tools nationwide, aiming to speed up diagnoses and cut research costs.

California Governor Gavin Newsom signed a landmark bill giving Uber and Lyft drivers the right to unionize as independent contractors.

COMMUNITY

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Rowan, Jennifer, and Joey—The Rundown’s editorial team

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