Why Elon Musk wants to put data centres into space | The Economist

Some people in the industry. are saying. that the best place. to build data centres. in the very near future. is going to be in orbit. And that is why. Elon Musk has just merged. his rocket company, SpaceX, with his AI lab, xAI, because that gives him, and so far only him, both pieces of the puzzle. But he's far from. the only person. pursuing this idea. And as it becomes. more expensive. to build data centres on Earth. and more difficult. to get enough energy. to power them, the idea is gaining ground. There are a lot of reasons.

for Musk to do this, partially just consolidating. his empire, partially SpaceX. throws off cash. because it has actual subscribers. who pay money for Starlink, and xAI eats up cash. because it's got. infinite training costs. So even before you get to the flashy. top line, I think there's some. financial engineering. that makes this make sense. But the flashy top. line is really flashy, right? Elon Musk has applied. to the FCC to launch 1m. satellites to train. AI models in space.

This is something that I. thought was ridiculous. Well, we thought. 40,000 satellites for Starlink. I mean, that sounded... It was originally. the 8,000 or something, wasn't it? I know, I know. And now it's going to be. “oh no, it's going to be 40 or 50”. So now he's going to 1m. Right? Exactly, but. there is an agenda here, right? Because he wants. to sell this company, right? This is a... And it's interesting. because he's talking. about the moon, having talked about Mars. for 20 years, right? Previously his explicit statement was. the moon is a distraction right now. don’t care about the moon. He's pivoted to the moon. and surely that’s. because you can make. a kind of business case, whether you believe it or not, there's a kind of business case:

we're going to have factories. on the moon, we're going to make. all these satellites, we're going to own AI. There wasn't really a business case. for going to Mars. It was just a kind of. this would be cool. So this is. about juicing the share price. before the IPO, right? I mean we're expecting. an IPO from SpaceX, we're expecting an IPO. from OpenAI, we're expecting. an IPO from Anthropic. We are going to see the. the AI IPO bonanza.