Comment by tristanj
12 hours ago
Space data centers are physically possible but don't make financial sense. The total cost of an orbital datacenter over five years is at least 2–3x that of a terrestrial one.
But those economics don't matter to SpaceX, because the main purpose of its orbital data centers is to create a use case for Starship. Starship has to fly frequently to iron out the kinks, encounter and fix rare (1/1000) failure situations, and optimize the launch cadence which pushes launch costs down. Plus Starship needs to fly a lot before it's ready for crewed flight. The long-term goal is a Starship optimized for crewed interplanetary travel. Orbital data centers are a payload that bring in some revenue, and provide a reason to launch constantly.
It's the same thing they did with Starlink to make Falcon 9 as reliable and rapidly reusable as it is.
2-3x sounds like a very low estimate.
There’s so much data center capacity being built all over the Earth. Thousands of large projects across US / China / Europe / Middle East. It would be astonishing if something that’s never been done before could be so cost-competitive immediately.
Starlink wasn’t the first time LEO communications constellations were attempted. Multiple 1990s projects did it (Iridium, GlobalStar…) and went bankrupt.
It took 30 years to make the concept work. SpaceX investors seem to be assuming the space data center business will be immediately viable.
SemiAnalysis' report on orbital data centers estimated 4x terrestrial costs in 2026, then parity around ~2040.
https://newsletter.semianalysis.com/p/to-boldly-go-the-case-...
Based on very specific assumptions: “…the world in which AI demand is so overwhelming as to exceed the already formidable datacenter capacity additions” — but also this same world is one where GPU chip supply is abundant, there just isn’t enough data centers to put them in.
This does not seem like the likeliest scenario to me.
3 replies →
My guess is: it just sounds cool.
Like the cybertruck
it sort of makes sense, if the need for that compute is in space and not terrestrial.
In my mind its the same sort of thing as mining in space. it makes no sense to mine ores in space for delivery to earth (unless its something exotic that you cant get on earth). Mining in space is best used for manufacturing in space (and furthering building in space)... then the cost benefit ratio suddenly flips hard in the "worth it" direction.
Yeah, there are some established needs for compute in space (edge processing for large datasets collected in space, and autonomous spacecraft control) that already happen to some extent and will happen a lot more with greater volumes of EO/SSA data collected and increasing militarization of space. They just don't look much like a datacentre for inference compute