Google and SpaceX Are Planning to Put Data Centers in Orbit

The AI arms race has officially left the ground. Google is in advanced discussions with SpaceX to deploy data centers into Earth's orbit — a move that, if realised, would represent one of the most ambitious infrastructure plays in the history of the technology industry.

According to reports citing sources familiar with the matter, SpaceX is positioning orbital infrastructure as the lowest-cost path to AI compute in the coming years — ahead of its planned IPO later in 2026. The proposal builds on SpaceX's expanding role in the AI ecosystem and Google's long-standing investment relationship with the company dating back to 2015.

Elon Musk has publicly championed the idea of orbital data centers as a solution to the two biggest bottlenecks in AI infrastructure today: land availability and energy access. Terrestrial data centers face relentless opposition from local communities over power consumption and environmental impact. Space-based compute, in theory, sidesteps both problems entirely.

Google's Project Suncatcher — which aims to deploy prototype satellites by 2027 — sits at the centre of this vision. If the talks progress, it could fundamentally reshape how AI workloads are distributed and processed, shifting gravity away from terrestrial cloud infrastructure toward a truly global, sky-based compute layer. The race to own the AI compute stack just went interplanetary.