Google, SpaceX Eye Space Data Centers for AI Boom

Google and SpaceX are reportedly in negotiations for a groundbreaking venture: establishing data centers in orbit. This potential collaboration comes as SpaceX prepares for its initial public offering, seeking to attract investors with the prospect of significantly reduced AI compute costs within the next few years by utilizing space-based infrastructure.

The discussions follow SpaceX's recent agreement with Anthropic to leverage xAI's computing resources and explore future orbital data center collaborations. Google is also engaging with other rocket launch providers and is independently pursuing Project Suncatcher, aiming to deploy prototype satellites by 2027.

While Elon Musk champions orbital data centers as a cost-effective solution, citing freedom from terrestrial buildout opposition, current analyses suggest that ground-based data centers remain cheaper when accounting for satellite construction and launch expenses. Google previously invested $900 million in SpaceX in 2015.