The next leg of the artificial intelligence boom may not be built entirely on Earth. SpaceX has paved the way for another potential avenue in space technology: compute capacity in orbit. Orbital computing might even be more credible than AI data centers built on Earth, based on four structural trends, Morgan Stanley researchers found, citing tighter constraints on land-based AI data centers, falling launch costs, advances in optical satellite networking and the rising volume of data generated in space. Orbital compute is a virtual data center with server racks in space supported by solar arrays, cooling radiators and laser-linked satellite networks. Such platforms might be less costly, ease constraints on earth, reduce environmental impacts and enable new capabilities for security-critical applications. Compute refers to the processing power, energy and infrastructure needed for AI models. Morgan Stanley doesn’t expect orbital computing to replace terrestrial hyperscale data centers this cycle, but notes that the more realistic near-term opportunity is orbital edge-AI, where satellites process imagery, sensor data and inference workloads in orbit before sending outputs back to Earth, said analyst Shawn Kim. Science fiction “Investing in space technology and exploration now represents an opportunity to participate at the forefront of frontier technology and defense innovation,” according to Jonathan Siegmann, research managing director at Stifel Financial. Commercial space profitability is no longer merely science fiction, as national security, civil and commercial space programs gain momentum, Siegmann said. The reusable launch model at SpaceX , for example, helped lower costs and moved the industry toward more scalable networks, while the company’s Starlink, a low-Earth-orbit broadband network, was a proof point for a commercial space business model and the key to SpaceX’s valuation in its recent initial public offering, the analyst said. . Kim at Morgan…
