Several major technology firms are racing to establish data centers in space to meet the surging computing demands of artificial intelligence (AI). This initiative, which has transitioned from theoretical discussions to practical testing phases between late 2025 and 2026, gained significant attention at the AIAA SciTech Forum 2026 held in Orlando, Florida. By leveraging the advantages of space, companies aim to overcome the energy and cooling challenges faced by terrestrial data centers.
Among the prominent players in this emerging field are tech giants such as Google, SpaceX, and Blue Origin, alongside innovative startups like Starcloud, which has already launched prototypes equipped with cutting-edge AI hardware into orbit. The focus on space-based computing stems from the growing necessity for AI processing power, as traditional data centers are increasingly strained by their electricity and water consumption—over 4% of total electricity in the U.S. was consumed by data centers in 2024, a figure projected to rise significantly by 2028.
Space offers compelling advantages for data center operations, particularly through the availability of near-constant solar power and natural cooling. In orbit, solar panels can achieve efficiency levels that are up to eight times greater than those on Earth due to the absence of atmospheric interference. Furthermore, cooling systems can utilize radiative heat dissipation instead of relying on water, effectively reducing energy costs and allowing for scalable AI computing without overburdening terrestrial power infrastructures.
Industry Developments
Google has initiated a research project named Project Suncatcher, which aims to deploy AI computing hardware in orbit via solar-powered satellites. The company plans to launch two prototype satellites equipped with Tensor Processing Units (TPUs) designed for AI tasks by early 2027. These satellites will utilize laser links for communication, bypassing traditional wired connections, with the goal of establishing blueprints for future space-based data centers.
In a notable milestone, Starcloud, supported by Nvidia and various venture capitalists, successfully launched a satellite named Starcloud-1 in late 2025. This satellite carried an Nvidia H100 GPU and successfully trained and ran AI models in orbit, marking the first instance of AI model training in space. The company envisions expanding its capabilities with future satellites and proposes constructing an extensive space data center outfitted with approximately 5 gigawatts of solar panels to deliver superior computing power efficiently.
Both SpaceX and Blue Origin are also advancing their research into orbital data centers. SpaceX intends to utilize its Starlink satellite network to deploy future satellites capable of hosting AI compute hardware. Reports suggest that upgraded Starlink satellites may launch as early as 2026, potentially featuring terabit-class capacities. Meanwhile, Blue Origin, led by Jeff Bezos, is reportedly developing technologies aimed at supporting AI workloads in space.
The competition for space-based data centers extends beyond established tech firms, as a variety of startups and nations are vying to establish compute infrastructure in orbit. Companies such as PowerBank Corporation and Orbit AI are planning solar-powered space nodes, while Axiom Space has outlined ambitions for data center modules on its private space station by 2027. Internationally, China is advancing its initiatives with the Three-Body Computing Constellation, which seeks to deploy thousands of satellites equipped with high-performance GPUs aimed at achieving a combined computing capacity of 1,000 peta-operations per second.
Despite the promising outlook, several engineering hurdles must be addressed before full-scale orbital data centers become commonplace. Radiation poses a significant risk, as it can damage GPUs and other chips, necessitating robust shielding. Additionally, engineering solutions for cooling in the vacuum of space and managing the risks associated with orbital debris remain critical challenges. Launch costs also present a barrier, although expectations suggest a decline to about $200 per kilogram by the mid-2030s could enhance feasibility.
The potential benefits of space-based data centers are substantial, particularly as the market is anticipated to experience rapid growth driven by the increasing demand for AI computing. Analysts project that the market will escalate from roughly $1.77 billion in 2029 to nearly $39.1 billion by 2035, reflecting an annual growth rate of approximately 67.4%. This growth symbolizes a shift toward more sustainable, high-performance computing that transcends Earth-based limitations.
As companies like Google, Starcloud, SpaceX, and Blue Origin push forward with their respective projects, the implications for AI infrastructure are profound. Space presents an opportunity to harness continuous solar energy and natural cooling methods, which could alleviate the environmental pressures associated with traditional computing facilities. The coming years, particularly around the expected prototype launches in 2027, will be pivotal in determining whether these ambitious visions of space-based computing can materialize into practical solutions for the future.
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