Report: Google and SpaceX are in talks to put data centers in orbit

Google and SpaceX are in talks to launch orbital data centers in space, the Wall Street Journal reported, citing sources familiar with the matter.

The potential deal comes as SpaceX prepares for its $1.75 trillion initial public offering later this year, selling investors on the idea that data centers in space will be the cheapest place to put AI computing within the next few years. It also follows Anthropic’s deal with SpaceX last week to use computing resources from the xAI data center in Memphis, Tennessee, with the potential to work together on orbital resources in the future. (SpaceX acquired xAI in February.)

Google is said to be in talks with other rocket launchers as well. The company also plans to launch satellite prototypes by 2027 as part of an initiative called Project Suncatcher, which was announced late last year.

Elon Musk has made a big fuss about orbital data centers, claiming they are cheaper to run. Advocates also point out that they are out of touch with the local backlash that American land-based construction has attracted. However, as TechCrunch recently reported, today’s ground-based data centers are much cheaper than those in orbit once the costs of building and launching satellites are taken into account.

Google invested $900 million in SpaceX in 2015, according to regulatory filings.

TechCrunch has reached out to Google and SpaceX for comment.