In a way, this complete factor was inevitable. Elon Musk and his coterie have been speaking about AI in house for years — primarily within the context of Iain Banks’ science-fiction sequence a few far-future universe the place sentient spaceships roam and management the galaxy.
Now Musk sees a possibility to appreciate a model of this imaginative and prescient. His firm SpaceX has requested regulatory permission to construct solar-powered orbital information facilities, distributed throughout as many as one million satellites, that might shift as a lot as 100 GW of compute energy off the planet. He has reportedly prompt a few of his AI satellites shall be constructed on the moon.
“By far the most cost effective place to place AI shall be house in 36 months or much less,” Musk mentioned final week on a podcast hosted by Stripe co-founder John Collison.
He’s not alone. xAI’s head of compute has reportedly wager his counterpart at Anthropic that 1% of worldwide compute shall be in orbit by 2028. Google (which has a major possession stake in SpaceX) has introduced an area AI effort known as Undertaking Suncatcher, which is able to launch prototype autos in 2027. Starcloud, a startup that has raised $34 million backed by Google and Andreessen Horowitz, filed its personal plans for an 80,000 satellite tv for pc constellation final week. Even Jeff Bezos has mentioned that is the longer term.
However behind the hype, what is going to it really take to get information facilities into house?
In a primary evaluation, right this moment’s terrestrial information facilities stay cheaper than these in orbit. Andrew McCalip, an area engineer, has constructed a helpful calculator evaluating the 2 fashions. His baseline outcomes present {that a} 1 GW orbital information heart may cost a little $42.4 billion — virtually 3x its ground-bound equal, due to the up-front prices of constructing the satellites and launching them to orbit.
Altering that equation, consultants say, would require expertise growth throughout a number of fields, huge capital expenditure, and loads of work on the provision chain for space-grade parts. It additionally is determined by prices on the bottom rising as assets and provide chains are strained by rising demand.
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June 23, 2026
Designing and launching the satellites
The important thing driver for any house enterprise mannequin is how a lot it prices to get something up there. Musk’s SpaceX is already pushing down on the price of attending to orbit, however analysts what it’s going to take to make orbital information facilities a actuality want even decrease costs to shut their enterprise case. In different phrases, whereas AI information facilities could appear to be a narrative a few new enterprise line forward of the SpaceX IPO, the plan is determined by finishing the corporate’s longest-running unfinished venture — Starship.
Think about that the reusable Falcon 9 delivers, right this moment, a price to orbit of roughly $3,600/kg. Making house information facilities doable, per Undertaking Suncatcher’s white paper, would require costs nearer to $200/kg, an 18-fold enchancment that it expects to be obtainable within the 2030s. At that value, nonetheless, the vitality delivered by a Starlink satellite tv for pc right this moment could be value aggressive with a terrestrial information heart.
The expectation is that SpaceX’s next-generation Starship rocket will ship these enhancements — no different automobile in growth guarantees equal financial savings. Nonetheless, that automobile has but to turn into operational and even attain orbit; a 3rd iteration of Starship is anticipated to make its maiden launch someday within the months forward.
Even when Starship is totally profitable, nonetheless, assumptions that it’s going to instantly ship decrease costs to prospects could not cross the scent take a look at. Economists on the consultancy Rational Futures make a compelling case that, as with the Falcon 9, SpaceX is not going to need to cost a lot lower than its greatest competitor — in any other case the corporate is leaving cash on the desk. If Blue Origin’s New Glenn rocket, for instance, retails at $70 million, SpaceX gained’t tackle Starship missions for exterior prospects at a lot lower than that, which would go away it above the numbers publicly assumed by house information heart builders.
“There will not be sufficient rockets to launch one million satellites but, so we’re fairly removed from that,” Matt Gorman, the CEO of Amazon Net Providers, mentioned at a current occasion. “If you consider the price of getting a payload in house right this moment, it’s huge. It’s simply not economical.”
Nonetheless, if launch is the bane of all house companies, the second problem is manufacturing value.
“We all the time take as a right, at this level, that Starship’s value goes to be lots of of {dollars} per kilo,” McCalip informed TechCrunch. “Persons are not bearing in mind the satellites are virtually $1,000 a kilo proper now.”
Satellite tv for pc manufacturing prices are the biggest chunk of that price ticket, but when high-powered satellites could be made at about half the price of present Starlink satellites, the numbers begin to make sense. SpaceX has made nice advances in satellite tv for pc economics whereas constructing Starlink, its record-setting communications community, and the corporate hopes to realize extra by way of scale. A part of the reasoning behind one million satellites is undoubtedly the fee financial savings that come from mass manufacturing.
Nonetheless, the satellites that shall be used for these missions should be giant sufficient to fulfill the complicated necessities for working highly effective GPUs, together with giant photo voltaic arrays, thermal administration programs, and laser-based communications hyperlinks to obtain and ship information.
A 2025 white paper from Undertaking Suncatcher provides one solution to evaluate terrestrial and house information facilities by the price of energy, the essential enter wanted to run chips. On the bottom, information facilities spend roughly $570 to $3,000 for a kW of energy over a 12 months, relying on native energy prices and the effectivity of their programs. SpaceX’s Starlink satellites get their energy from on-board photo voltaic panels as an alternative, however the price of buying, launching, and sustaining these spacecraft delivers vitality at $14,700 per kW over a 12 months. Put merely, satellites and their parts should get rather a lot cheaper earlier than they’re cost-competitive with metered energy.
The house atmosphere is just not playing around
Orbital information heart proponents usually say that thermal administration is “free” in house, however that’s an oversimplification. With out an environment, it’s really harder to disperse warmth.
“You’re counting on very giant radiators to only be capable to dissipate that warmth into the blackness of house, and in order that’s loads of floor space and mass that you must handle,” mentioned Mike Safyan, an government at Planet Labs, which is constructing prototype satellites for Google Suncatcher which are anticipated to launch in 2027. “It’s acknowledged as one of many key challenges, particularly long run.”
In addition to the vacuum of house, AI satellites might want to take care of cosmic radiation. Cosmic rays degrade chips over time, and so they can even trigger “bit flip” errors that may corrupt information. Chips could be protected with shielding, use rad-hardened parts, or work in sequence with redundant error checks, however all these choices contain costly trades for mass. Nonetheless, Google used a particle beam to check the results of radiation on its tensor processing models (chips designed explicitly for machine studying functions). SpaceX executives mentioned on social media that the corporate has acquired a particle accelerator for simply that function.
One other problem comes from the photo voltaic panels themselves. The logic of the venture is vitality arbitrage: Placing photo voltaic panels in house makes them anyplace from 5x to 8x extra environment friendly than on Earth, and in the event that they’re in the appropriate orbit, they are often in sight of the solar for 90% of the day or extra, rising their effectivity. Electrical energy is the principle gas for chips, so extra vitality equals cheaper information facilities. However even photo voltaic panels are extra sophisticated in house.
House-rated photo voltaic panels fabricated from uncommon earth parts are hardy, however too costly. Photo voltaic panels comprised of silicon are low-cost and more and more prevalent in house — Starlink and Amazon Kuiper use them — however they degrade a lot quicker because of house radiation. That can restrict the lifetime of AI satellites to round 5 years, which implies they should generate return on funding quicker.
Nonetheless, some analysts assume that’s not such a giant deal, based mostly on how rapidly new generations of chips arrive on the scene. “After 5 – 6 years, the {dollars} per kilowatt-hour doesn’t produce a return, and that’s as a result of they’re not cutting-edge,” Philip Johnston, the CEO of Starcloud, informed TechCrunch.
Danny Discipline, an government at Solestial, a startup constructing space-rated silicon photo voltaic panels, says the business sees orbital information facilities as a key driver of progress. He’s talking with a number of firms about potential information heart initiatives, and says “any participant who’s large enough to dream is at the very least excited about it.” As a long-time spacecraft design engineer, nonetheless, he doesn’t low cost the challenges in these fashions.
“You’ll be able to all the time extrapolate physics out to an even bigger measurement,” Discipline mentioned. “I’m excited to see how a few of these firms get to a degree the place the economics make sense and the enterprise case closes.”
How do house information facilities slot in?
One excellent query about these information facilities: What’s going to we do with them? Are they normal function, or for inference, or for coaching? Primarily based on current use circumstances, they might not be completely interchangeable with information facilities on the bottom.
A key problem for coaching new fashions is working 1000’s of GPUs collectively en masse. Most mannequin coaching is just not distributed, however accomplished in particular person information facilities. The hyperscalers are working to vary this so as to enhance the facility of their fashions, nevertheless it nonetheless hasn’t been achieved. Equally, coaching in house would require coherence between GPUs on a number of satellites.
The group at Google’s Undertaking Suncatcher notes that the corporate’s terrestrial information facilities join their TPU networks with throughput within the lots of of gigabits per second. The quickest off-the-shelf inter-satellite comms hyperlinks right this moment, which use lasers, can solely stand up to about 100 Gbps.
That led to an intriguing structure for Suncatcher: It entails flying 81 satellites in formation so they’re shut sufficient to make use of the form of transceivers relied on by terrestrial information facilities. That, in fact, presents its personal challenges: The autonomy required to make sure every spacecraft stays in its appropriate station, even when maneuvers are required to keep away from orbital particles or one other spacecraft.
Nonetheless, the Google research provides a caveat: The work of inference can tolerate the orbital radiation atmosphere, however extra analysis is required to grasp the potential impression of bit-flips and different errors on coaching workloads.
Inference duties don’t have the identical want for 1000’s of GPUs working in unison. The job could be accomplished with dozens of GPUs, maybe on a single satellite tv for pc, an structure that represents a form of minimal viable product and the seemingly start line for the orbital information heart enterprise.
“Coaching is just not the best factor to do in house,” Johnston mentioned. “I believe virtually all inference workloads shall be accomplished in house,” imagining all the things from customer support voice brokers to ChatGPT queries being computed in orbit. He says his firm’s first AI satellite tv for pc is already incomes income performing inference in orbit.
Whereas particulars are scarce even within the firm’s FCC submitting, SpaceX’s orbital information heart constellation appears to anticipate about 100 kW of compute energy per ton, roughly twice the facility of present Starlink satellites. The spacecraft will function in reference to one another and use the Starlink community to share data; the submitting claims that Starlink’s laser hyperlinks can obtain petabit-level throughput.
For SpaceX, the corporate’s current acquisition of xAI (which is constructing its personal terrestrial information facilities) will let the corporate stake out positions in each terrestrial and orbital information facilities, seeing which provide chain adapts quicker.
That’s the good thing about having fungible floating level operations per second — if you can also make it work. “A FLOP is a FLOP, it doesn’t matter the place it lives,” McCalip mentioned. “[SpaceX] can simply scale till [it] hits allowing or capex bottlenecks on the bottom, after which fall again to [their] house deployments.”
Bought a delicate tip or confidential paperwork about SpaceX? For safe communication, you possibly can contact Tim by way of Sign at tim_fernholz.21.
