March 7 (Reuters) - Elon Musk-owned artificial

intelligence firm xAI has bought a 1-million-square-foot

property in Southwest Memphis, Tennessee, the Greater Memphis

Chamber said on Friday, as the startup looks to expand its AI

infrastructure amid intensifying competition in the industry.

The new investment builds on the company's earlier

announcement in December, in which it laid out plans to expand

its Colossus supercomputer to house at least one million

graphics processing units (GPUs) in the state.

Colossus is seen as pivotal in advancing Musk's AI

ambitions, as he works to gain a competitive edge over rivals

such as OpenAI following the recent escalation in tensions

between him and ChatGPT maker's CEO, Sam Altman, with the

billionaire's bid to take control of the firm.

The Chamber said that the Colossus supercomputer is "well on

the path to the supercluster size", as indicated in xAI's

December announcement.

The expansion of AI infrastructure has drawn criticism from

environmental activists, as data centers consume large amounts

of energy.

The Memphis Chamber said xAI's new facility follows an $80

million water recycling plant and also features the world's

largest deployment of Tesla Megapacks for data center

operations.

It was reported on Wednesday that Musk's Tesla

will also build a

1-million-square-foot

factory in Texas to manage and store its Megapack energy

products.