Since AI needs more power than Earth’s electricity grids can handle, tech giants are now looking to build data centers in space.

Google and SpaceX are reportedly planning to launch orbital data centers, a move that could redefine AI infrastructure. 

According to The Wall Street Journal, Google is shopping around, holding similar talks with various rocket launch providers beyond SpaceX.

The discussions come as terrestrial data centers face a storm of soaring electricity costs, aging grids, and local backlash against the massive, energy-hungry warehouses currently proliferating across the globe.

Abundance of solar energy

The logic behind the move is as simple as it is ambitious. Down here, data centers are shackled to Earth’s geography and finite energy. In orbit, servers can tap into unfiltered, 24/7 solar power, overcoming terrestrial infrastructure constraints entirely.

Elon Musk is betting his company’s future on this shift. As SpaceX gears up for a historic IPO later this year — targeting a massive valuation between $1.75 trillion and $2 trillion — Musk is pitching orbital computing not just as a tech gimmick, but as the ultimate cost-saver.

However, critics point out that launch costs currently dwarf ground-based builds. But Musk is betting that SpaceX’s reusable rockets will eventually make space the cheapest place in the universe to run an AI model.

Quartz reported that the two giants are already deeply intertwined. Google’s parent company, Alphabet, currently owns 6.1 percent of SpaceX. Moreover, the partnership is cemented at the leadership level, with Google executive Don Harrison serving on the SpaceX board.

This existing financial and strategic alliance provides a solid foundation for their new, ambitious push into orbital computing.

Rather than relying solely on SpaceX, Google is pursuing its own space-based roadmap through a “moonshot” initiative called Project Suncatcher.

Formally announced by CEO Sundar Pichai in late 2025, the project aims to deploy a constellation of solar-powered satellites equipped with Google’s custom Tensor Processing Units (TPUs). 

To bring this vision to life, Google has partnered with satellite manufacturer Planet Labs to design and launch two prototype satellites by early 2027.

These test units will serve as a proof-of-concept for a potential 81-satellite cluster that uses laser-based communication to share massive AI workloads across the constellation. It would create a high-speed, orbital extension of Google’s terrestrial data centers. 

SpaceX’s vision

Meanwhile, SpaceX is also expanding into the orbital data-center market, marked by massive infrastructure scaling and high-profile partnerships. The company has filed for regulatory approval to launch up to one million satellites to support this venture, dwarfing its current Starlink constellation. 

Central to this strategy is a landmark deal with AI firm Anthropic, under which SpaceX will provide 300 megawatts of computing power powered by over 220,000 Nvidia GPUs. 

Despite the hype, the transition won’t be easy. Tech analysts warn that the cost of hardened, space-ready hardware remains a significant barrier compared to the efficiency of ground-based builds. 

If successful, the AI revolution will no longer be constrained by Earth’s limits. Instead, the future of intelligence may reside in a high-speed, solar-powered extension of the cloud, orbiting 300 miles above the power grids it outgrew.