The orbital data center boom is promising opportunities well beyond the pioneers hoping to build colossal, AI-driven computing platforms in space.
A mix of ventures developing novel space technologies are looking to ride a wave of investment and dealmaking in the early innings of this emerging market, even as SpaceX and others behind some of the largest proposals plan to handle as much of the work in-house as possible.
Still, given the anticipated growth in AI and the power, regulatory and other infrastructure constraints pushing data centers off Earth, expectations are high that the market will be big enough for multiple players and strategies. Some ventures argue their capabilities would greatly improve performance, while others even claim they are essential to making the orbital data center business case work.
Powering new business
A major draw of Earth’s orbit is an abundance of solar energy that could feed data centers, which are driving the fastest-growing demand for power on the ground.
This is where startup Star Catcher sees an opening for the optical power-beaming constellation it is developing to transmit energy to spacecraft using their existing solar arrays.
“Sure, you have the solar system’s greatest fusion reactor there in the sky — when you can see it,” Star Catcher cofounder and CEO Andrew Rush said during a March 31 SpaceNews event on orbital data centers.
“But it’s really about the ability to collect, distribute and utilize that energy.”
According to Rush, concentrating solar energy would be a game-changer for space-based computing. Today, an average terrestrial data center rack is about a cubic meter in volume, weighs a couple hundred kilograms and pulls about 60 kilowatts of power.
Satellites with roughly the same mass and volume offer about one- tenth of that power.
Putting one data center rack in space the traditional way would therefore require roughly 10 satellite buses’ worth of hardware, Rush said, or accepting an uneconomical 10% duty cycle.
He argued that a shared power grid in space would lower energy costs while raising a small satellite platform to around 60 kilowatts, enabling the data center payload to operate with 100% uptime.
“Of course, you need to account for thermal [management] with that,” Rush added, and “other elements of the system, but the point is you can stay in a cost-effective existing platform and have the uptime that your business model and your customers need.”
Relying on others for energy, rather than building spacecraft around peak demand, could also reduce design tradeoffs around size, mass and onboard power systems.
Rethinking the basics
Reusable satellite developers are another group of startups challenging industry norms, betting that a shift away from disposable rockets will ultimately extend to the spacecraft they launch.
Brian Taylor, founder and CEO of Lux Aeterna, says orbital data centers are a prime use case for the returnable spacecraft his venture is advancing.
“Orbital data centers are dynamic systems,” Taylor said via email. “Unlike communications satellites that you launch and forget, these systems require high-cadence servicing. They demand regular hardware upgrades and physical asset recovery on a continuous, iterative basis.”
While in-orbit servicing technologies are also advancing, reusable satellite developers argue their approach would make it easier to swap out hardware directly, avoiding any need to rely on future fleets of robotic servicers.
“The economics collapse if every maintenance event requires launching a new satellite,” Taylor continued.
“Reusable satellites solve this: a returnable spacecraft can carry replacement modules up, bring degraded hardware back to Earth for refurbishment or forensic analysis and rotate components on a schedule.”
It would mean orbital infrastructure could be treated more like terrestrial data center operators handle their server racks.
There are also many ventures on the outskirts of the orbital data center market, such as space-based data storage specialist Lonestar.
And while much of the industry conversation today is focused on the infrastructure needed to enable and improve in-orbit computing, companies such as space infrastructure provider Loft Orbital are also busy working on the applications side of the market.
“None of it is going to matter unless there is a vibrant ecosystem of applications actually providing value,” said Loft Orbital cofounder and chief operating officer Alex Greenberg at the SpaceNews event. That means “answering real problems, saving people money, saving lives, etc.”
<em>This article first appeared in the May 2026 issue of SpaceNews Magazine.