A new rivalry is emerging between Jeff Bezos and Elon Musk, and this time the battleground is not rockets or satellites, but artificial intelligence infrastructure in orbit. According to a new report by The Wall Street Journal, both billionaires are exploring plans to place AI-powered data centers in space, opening a new front in the race to dominate next-generation computing.
Sources cited in the report say Blue Origin, the space company founded by Bezos, has been quietly developing concepts for orbital data centers for more than a year. At the same time, SpaceX is reportedly planning an upgraded version of its Starlink satellites that could carry AI computing payloads, effectively turning parts of its massive satellite constellation into distributed space-based data centers.
The push comes as demand for AI computing power explodes on Earth. The United States already has roughly 4,000 data centers either operating or under construction, according to the Pew Research Center. McKinsey estimates that global spending on data centers could reach $6.7 trillion by 2030 as companies race to train larger and more complex AI models.
That growth is putting significant strain on power grids. A 2024 report from the U.S. Department of Energy found that data centers consumed about 4.4 percent of total U.S. electricity in 2023. That figure could rise to between 6.7 and 12 percent by 2028. In some regions, residents have already reported higher electricity prices linked to nearby data center expansion.
Moving AI infrastructure into space could offer a partial solution. Orbital data centers could rely on constant solar energy, avoiding the land, water, and power constraints that plague Earth-based facilities. Will Marshall, co-founder of satellite imaging company Planet Labs, told the Journal that the idea has been discussed for years, but only recently became realistic as launch costs dropped. He said the industry is nearing a point where such concepts could be economically viable.
There are, however, major hurdles. Launching heavy computing hardware into orbit remains expensive, and managing heat dissipation, maintenance, and radiation exposure presents serious engineering challenges. Even so, momentum appears to be building across the tech sector.
In November, Google announced a partnership with Planet Labs to send two prototype satellites equipped with Tensor Processing Unit AI chips into orbit. The project will study whether a network of solar-powered satellites could harness continuous sunlight for large-scale AI computation, with launches targeted for early 2027.
If Bezos and Musk succeed, AI data centers in space could fundamentally reshape how and where the world’s most powerful computing systems operate. What began as a competition over rockets may soon redefine the future of AI infrastructure itself.
