Elon Musk is promoting a bold idea when he wants to place artificial intelligence (AI) data centers in space to solve the increasing energy, cooling and operating costs problem on Earth.
According to Reuters, this plan could be accelerated if the merger between SpaceX and Musk's AI company xAI becomes a reality.
The concept of an AI data center placed in space is still in its infancy, but is expected to revolutionize the computing industry.
This model is based on hundreds of solar satellites connected on orbit, together processing huge computing volumes for AI systems such as Grok of xAI or ChatGPT of OpenAI.
Proponents argue that space brings two key advantages, including near-continuous solar energy and the ability to dissipate heat directly into the space environment, thereby significantly reducing cooling costs.
In the context of AI consuming more and more electricity, this is considered a potential direction to maintain the pace of technological development.
However, space experts warn that the commercialization of AI data centers on orbit still faces many barriers.
Challenges include risks from space debris, space radiation that can damage hardware, limitations in direct maintenance, as well as satellite launch costs and equipment replacement.
Deutsche Bank forecasts that small-scale test projects may appear in the 2027-2028 period, while large satellite "constellations" may only become a reality in the 2030s if initial tests are successful.
Musk believes that SpaceX is holding a strategic advantage. This company has launched thousands of Starlink satellites and possesses the world's leading rocket launch capabilities.
Speaking at the World Economic Forum in Davos (held from January 19 to 23, 2026), Musk affirmed that building an AI data center powered by solar energy in space is "obvious" and could become the cheapest option in the next two to three years.
SpaceX is considering an IPO plan this year, with a valuation that could exceed 1,000 billion USD. Part of the capital raised is expected to be used to develop AI data center satellites, expanding Musk's ambitions in the global technology race.
Not only Musk, many other giants are also targeting space computing. Jeff Bezos' Blue Origin studies gigawatt-capacity AI data centers on orbit, with the expectation that the cost will be cheaper than Earth within 10-20 years.
Starcloud, backed by Nvidia, has launched the Starcloud-1 satellite carrying the Nvidia H100 chip into space, testing AI model training and operation as a testament to its feasibility.
Google is also joining the race with the Suncatcher Project, aiming to connect solar-powered satellites equipped with Tensor processors into an "AI cloud" on orbit.
Meanwhile, China announced a plan to build a "space cloud" within 5 years, with the goal of developing gigawatt-capacity digital infrastructure in space.
Despite many challenges, AI data centers in space are gradually becoming a new competitive front among technology powerhouses.
