Elon Musk's SpaceX has reportedly unveiled a prototype of an 'handset-like' AI device to investors. The sleek gadget is said to be thinner than an iPhone and could potentially compete with mobile giants like Verizon and AT&T. However, Musk has dismissed the reports as false.

The company’s expertise in manufacturing and access to necessary chips make it plausible for SpaceX to join the smartphone market. Yet, questions remain about whether consumers will embrace a new AI device from the rocket builder. Musk might be inspired by OpenAI's efforts, but the road to success is littered with failed AI devices.

The prototype reportedly runs on proprietary software and integrates technology from xAI, which SpaceX acquired earlier this year. This could prevent the devices from being confined to other company platforms, aiming for a more native user experience. However, history shows that entering the crowded smartphone market isn't without risks.