Elon Musk admits xAI used OpenAI models, igniting fresh AI ethics debate

Elon Musk has stirred a fresh controversy in the artificial intelligence (AI) industry after admitting that his AI startup xAI partly used OpenAI’s models to train its chatbot Grok, a process widely known as model distillation. 

The revelation came during Musk’s testimony in the ongoing federal trial against OpenAI, where he is challenging the company’s shift from its original non-profit mission to a commercial powerhouse.

Under questioning, Musk described distillation as the use of one AI model to train another. 

When asked directly whether xAI had applied the method using OpenAI technology, Musk initially avoided a straight answer before conceding that the response was “partly yes,” calling it standard industry practice.

Model distillation allows smaller or newer AI systems to absorb the capabilities of larger, more advanced models while cutting down training time and cost. 

However, the technique has become increasingly controversial when used across rival companies, as it raises concerns over intellectual property, competitive fairness, and possible violations of usage policies.

Major AI firms including OpenAI, Anthropic and Google have repeatedly warned against unauthorised distillation, arguing it can replicate years of expensive research without equivalent investment.

Musk’s acknowledgment now adds a striking twist to his legal battle with OpenAI, exposing how even fierce competitors may depend on one another’s technology in the race to dominate AI.