AI’s excessive power consumption is pushing data infrastructure beyond Earth’s physical limits.
Falling launch costs make orbital computing experiments commercially plausible for the first time.
Space-based processing could transform satellite data, security, and global cloud architecture.
The race to build bigger data centres on Earth is running into a wall, with power shortages, land conflicts, and rising environmental scrutiny. As artificial intelligence creates a huge demand for computing power, cloud infrastructure is moving beyond Earth.
Space data centres, once limited to science fiction, are now being tested by private companies, space agencies, and even startups. The question is no longer whether they are possible, but whether they are practical.
The AI boom has turned data centres into energy-intensive industrial complexes. Training a single frontier model can consume as much electricity as a small town. Tech companies are scrambling to secure clean, continuous power, often facing public backlash over water use for cooling and the strain on local grids.
Space offers a compelling alternative. Satellites in low-Earth orbit receive near-constant solar energy without atmospheric losses. The vacuum of space allows heat to dissipate through radiation, reducing the need for water-based cooling systems. In theory, this creates a self-sustaining, highly-efficient computing environment powered almost entirely by solar energy.
Earth observation satellites, communications constellations, and defence platforms generate massive amounts of data that must be transmitted to ground locations for processing. Orbital data centres could enable real-time data analysis, helping reduce latency, bandwidth costs, and the need for ground-based systems.
The space industry has undergone a fundamental economic transformation, driven by reusable rockets that have ushered in a new era of lower-cost launch operations. Operations that used to be highly expensive are now accessible to businesses.
Major technology and space companies are exploring orbital computing platforms, while startups are testing AI hardware in microgravity. Early demonstrations have already shown that advanced processors can operate in orbit. Some projects aim to create constellations of computing satellites, effectively turning space into a distributed cloud.
India, too, is entering the conversation. Plans to integrate launch vehicle technology with orbital computing platforms suggest a future in which rocket upper stages could be repurposed as data nodes in low-Earth orbit. If realised, this would place the country within the emerging space-cloud ecosystem rather than at its periphery.
For all its promise, the concept is far from being commercially mature.
The first hurdle is cost. Even with reusable launch systems, sending tonnes of computing hardware into orbit is expensive. Every equipment upgrade or repair requires a new mission, which changes the cost structure.
The second factor we need to examine is durability, as space is a harsh environment. It presents multiple dangers: radiation, which can harm electronic equipment, and micrometeoroids, which pose ongoing threats and extreme temperature changes that test material performance. The servers that operate in climate-controlled environments need a complete redesign to operate in orbital space.
Latency is another constraint. For everyday internet use, ground-based data centres located close to users will remain faster and more efficient. The earliest applications of space-based computing are therefore likely to be niche, satellite data processing, defence communications, and ultra-secure off-planet storage.
Some companies are already proposing lunar data vaults designed to store critical information beyond the reach of terrestrial disasters. The pitch is simple: in the event of cyberwar, climate catastrophe, or systemic failure on Earth, humanity’s most valuable data would remain intact off-planet.
It is a vision that blurs the line between infrastructure planning and civilisational insurance.
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The space data centres of today exist in the same status as reusable rockets from two decades ago. The future of these space data centres depends on one factor: their successful operation requires reducing launch expenses to a level that supports widespread system implementation. The computing world will achieve freedom from all geographical limits, power grid dependencies, and water resource constraints. The cloud will extend into orbit.
For now, space data centres are not a replacement for terrestrial infrastructure. They are an emerging layer, one that could redefine how and where the world processes information.
1. What is a space data centre?
A space data centre is a computing facility placed in orbit that uses solar power and vacuum-based cooling to process and store data, especially for satellite services and AI workloads.
2. Why are companies interested in space-based computing?
Rising AI energy demand, land constraints, and water-intensive cooling on Earth are pushing firms to explore space, where continuous solar power and natural heat dissipation can improve efficiency.
3. Will space data centres replace terrestrial ones?
No. Ground-based facilities will remain essential for low-latency consumer services. Space data centres will initially support niche uses like satellite data processing, secure storage, and specialised AI workloads.
4. What are the biggest challenges?
High launch costs, radiation risks, hardware durability, and difficult maintenance make large-scale deployment expensive. Commercial viability depends heavily on cheaper, reliable heavy-lift, reusable launch systems.
5. When could space data centres become operational at scale?
Prototype missions are underway. Limited commercial use may begin in the late 2020s, while large-scale deployment is more likely in the 2030s if launch economics improve significantly.