Elon Musk's artificial intelligence venture, xAI, introduced its latest AI model, Grok-3, on Tuesday, claiming it delivers significantly improved reasoning capabilities and outperforms rival models from OpenAI, Google, and China-based DeepSeek. The company also announced a new AI-driven search tool, Deep Search, which it described as a "next-generation search engine."
"We're very excited to present Grok-3, which is, we think, an order of magnitude more capable than Grok-2 in a very short period of time," Musk said during a live demonstration of the model streamed on X, his social media platform. The AI system will be available to X Premium Plus subscribers starting Tuesday in the U.S., with access also offered through a separate web and app-based subscription.
Grok-3 introduces two distinct reasoning modes: "Think," which displays the model's step-by-step reasoning process, and "Big Brain," designed for complex problem-solving tasks requiring substantial computational power. Speaking last week at The World Governments Summit in Dubai, Musk described the new model as "scary smart," noting that it had been trained on a combination of real and synthetic data, allowing it to refine its logic through self-evaluation.
"This might be the last time that an AI is better than Grok," Musk said, emphasizing that Grok-3 represents a leap in AI reasoning capabilities. The xAI team stated that internal testing showed the model outperforming competitors, with strong results in standardized math, science, and coding evaluations. An early version of Grok-3 reportedly received better ratings than rival models in blind testing on Chatbot Arena, a crowdsourced platform that pits AI models against each other.
Despite its advancements, the model remains a work in progress. "We should emphasize that this is kind of a beta, meaning that you should expect some imperfections at first, but we will improve it rapidly, almost every day," Musk said. A synthesized voice assistant feature, similar to OpenAI's Advanced Voice Mode for ChatGPT, is expected in a future update.
Intensified AI Competition
The launch of Grok-3 signals xAI's increasing competition with OpenAI, Google, and emerging players in the AI space. OpenAI's most advanced model, the o1, introduced last year, has set high standards in AI reasoning and problem-solving. Meanwhile, DeepSeek, a Chinese AI startup, recently drew attention with a technical paper claiming its open-source model could match OpenAI's o1 performance using a more energy-efficient approach.
The competition is particularly fierce given U.S. restrictions on AI chip exports to China, which have limited access to Nvidia's high-end GPUs, crucial for training advanced models. However, DeepSeek's model has demonstrated that sophisticated AI systems can still be developed with less powerful hardware.
To keep pace with increasing computational demands, xAI disclosed on Tuesday that it had doubled the size of its GPU cluster, originally consisting of 100,000 Nvidia processors, to accelerate Grok-3 training.
Monetization Strategy and Subscription Model
Access to Grok-3 will come at a premium. xAI is raising the price of X Premium Plus to $40 per month, up from $22 in December, marking its second price hike in two months. The company is also introducing a new subscription tier called SuperGrok, priced at $30 per month, which promises "the most advanced capabilities and earliest access to new features." It remains unclear whether this is an additional fee on top of X subscriptions.
While Musk has positioned xAI as a competitor to OpenAI, the two organizations have been at odds since his departure from OpenAI's board in 2018. Musk was among OpenAI's original founders but has since criticized its leadership and direction. He recently led an investor group in an unsuccessful attempt to acquire OpenAI's nonprofit parent for $97.4 billion.
Grok's previous iterations have faced scrutiny over content moderation and accuracy issues. The chatbot has been criticized for spreading election misinformation and generating controversial content due to its looser safety restrictions compared to competitors. Addressing these concerns, Musk said, "Grok-3 is a maximally truth-seeking AI-even if that truth is sometimes at odds with what is politically correct."
xAI also announced plans to open-source Grok-2 in the coming months, though details about when and how this will happen remain unclear.
