SpaceX filed an FCC application to deploy up to one million solar-powered satellites for use as orbital data centers. The filing describes the constellation as a step toward a Kardashev II-level civilization.
The proposal faces immediate skepticism from industry analysts, technology executives, and environmental groups. Critics question the economic viability and environmental impact of placing data centers in orbit. The FCC public comment period on the application closes on March 6.
Gartner analyst Bill Ray called the concept “peak insanity” in a report published this week. Ray warned that companies are wasting money on an orbital data center “bubble” that will not be viable for decades. Nvidia CEO Jensen Huang stated that the economics for orbital data centers are poor today due to heat dissipation challenges. Huang noted that space requires large radiators for heat conduction because there is no airflow. OpenAI CEO Sam Altman dismissed the idea as “ridiculous” at a press conference in New Delhi. Altman stated that orbital data centers will not matter at scale this decade.
Short seller Jim Chanos labeled the plan “AI Snake Oil.” Chanos noted that electricity costs represent only 5–7% of AI data center revenues. He stated that every other cost would be higher in space. Environmental group DarkSky International issued a guide urging supporters to file formal objections with the FCC. The group warned the proposal would increase active satellites by roughly 70-fold and threaten the night sky. Harvard astrophysicist Jonathan McDowell stated that one million satellites would be a major challenge for astronomy.
MIT aerospace engineers published research in *Nature Sustainability* finding that greenhouse gas emissions are causing the thermosphere to contract. The study found this reduces atmospheric drag and could halve the satellite carrying capacity of low-Earth orbit by 2100. An Associated Press investigation found increasing community opposition to ground-based data centers in the U.S. due to power and water concerns.
SpaceX completed its acquisition of xAI on February 2, valuing the combined entity at $1.25 trillion. Musk predicted orbital data centers would become more economical than terrestrial ones within two to three years. Deutsche Bank estimated the timeline is more likely the 2030s. Amazon founder Jeff Bezos predicted space-based data centers could arrive within 10 to 20 years. Google CEO Sundar Pichai plans to send test hardware to orbit by 2027. SpaceX currently operates roughly 9,500 of the approximately 14,500 active satellites orbiting Earth.
