File photo: Elon Musk waves to the crowd at the 56th annual meeting of the World Economic Forum in Davos, Switzerland, last month | Photo credit: DENIS BALIBOUSE
The world’s richest man said he wants to put as many as a million satellites into orbit to form massive, solar-powered data centers in space – a move to enable expanded use of artificial intelligence and chatbots without causing power outages and skyrocketing utility bills.
To fund those efforts, Musk on Monday combined SpaceX with his AI company and is planning a major initial public offering of the combined company.
“Space-based AI is clearly the only way to scale,” Musk wrote on SpaceX’s website Monday, adding of his solar energy ambitions: “It’s always sunny in space!”
But scientists and industry experts say even Musk, who outsmarted Detroit to make Tesla the world’s most valuable automaker, faces enormous technical, financial and environmental obstacles.
Feeling the heat
Capturing the sun’s energy from space to run chatbots and other AI tools would ease pressure on power grids and reduce demand on vast computer warehouses that consume farms and forests and consume vast amounts of water for cooling.
But space brings its own problems.
Data centers generate enormous heat. Space seems to offer a solution because it is cold. But it is also a vacuum, which traps heat in objects, just as a thermos keeps coffee warm with double walls without air between them.
“An uncooled computer chip in space would overheat and melt much faster than a chip on Earth,” said Josep Jornet, a professor of computer and electrical engineering at Northeastern University.
One solution is to build giant radiator panels that glow in infrared light to push the heat “into the dark void,” says Jornet, noting that the technology has worked on a small scale, including on the International Space Station. But for Musk’s data centers, he says, this would require a series of “huge, fragile structures that have never been built before.”
Floating debris
Then there’s space junk.
A single faulty satellite that breaks down or loses its orbit can cause a series of collisions, potentially disrupting emergency communications, weather forecasts and other services.
Musk noted in a recent regulatory filing that in the seven years he has owned Starlink, his satellite communications network, he has had only one “low-speed debris-generating event.” Starlink has operated about 10,000 satellites, but that’s a fraction of the million it now plans to put in space.
“We could be reaching a tipping point where the chance of a collision becomes too high,” says John Crassidis of the University at Buffalo, a former NASA engineer. “And these objects are moving fast: 28,500 kilometers per hour. Very violent collisions can occur.”
No repair crews
Even without collisions, satellites fail, chips degrade and parts break.
Special GPU graphics chips used by AI companies, for example, can become damaged and need to be replaced.
“On Earth, you would send someone to the data center,” says Baiju Bhatt, CEO of Aetherflux, a space-based solar energy company. “You replace the server, you replace the GPU, you do surgery on that thing and shove it back in.”
But no such repair crew exists in orbit, and those GPUs in space can become damaged as a result of their exposure to high-energy particles from the sun.
Bhatt says one solution is to oversupply the satellite with extra chips to replace those that fail. But that’s an expensive proposition, as they will likely cost tens of thousands of dollars each, and current Starlink satellites only have a lifespan of about five years.
Competition – and leverage
Musk isn’t the only one trying to solve these problems.
A Redmond, Washington company called Starcloud launched a satellite in November carrying a single Nvidia-made AI computer chip to test how it would fare in space. Google is exploring orbital data centers in a venture it calls Project Suncatcher. And Jeff Bezos’ Blue Origin announced plans in January to launch a constellation of more than 5,000 satellites late next year, although the focus was more on communications than AI.
Still, Musk has an advantage: he has rockets.
Starcloud had to use one of its Falcon rockets to send its chip into space last year. Aetherflux plans to send a set of chips, which it calls Galactic Brain, into space on a SpaceX rocket later this year. And Google may also have to turn to Musk to get the first two planned satellite prototypes off the ground early next year.
Pierre Lionnet, research director at industry body Eurospace, says Musk routinely charges his rivals much more than he charges himself: up to $20,000 per kilo of cargo, compared to $2,000 internally.
He said Musk’s announcements this week indicate he plans to use that advantage to win this new space race.
“If he says we’re going to put these data centers in space, that’s a way of telling the others that we’re going to keep this low launch cost to myself,” Lionnet said. “It’s kind of a power play.”
Published on February 5, 2026
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