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Space-based Data Centers

Artificial Intelligence and Space Economy reshape digital infrastructure

07.09.2026

reading time: 9 min

The space economy is undergoing a profound transformation. Once a sector based on launches, satellites and connectivity, and for decades the domain of government agencies and major defence contractors, it is now evolving under the combined influence of private capital and rapidly growing technological demand.

A central role is being played by artificial intelligence (AI): the AI models that are changing the way we work and interact with content, data, and digital tools require ever-greater computing capacity, which today is concentrated in terrestrial data centers. This is where the space economy comes into play, offering the possibility of moving part of this computing capacity into space.

Until recently, satellites were expensive assets designed for specific missions —more akin to specialized instruments than to a network on which infrastructure can be built. Starlink has begun to change this perception, demonstrating that a constellation of thousands of satellites can deliver a continuous service on a global scale. In orbit data centers could represent the next step: the objective is no longer to simply transmit signals, but to host and operate in orbit the AI models that currently reside on ground-based servers.

Once artificial intelligence can be deployed in space, Earth’s orbits will become a new type of global digital infrastructure, comparable to road networks or optic systems. This transformation builds on the changes already underway in the data center industry, extending computing infrastructure beyond the atmosphere.

ARTIFICIAL INTELLIGENCE AND TERRESTRIAL DATA CENTERS: GROWING PRESSURE ON INFRASTRUCTURE

The growing demand for computing power generated by AI is placing increasing pressure on terrestrial infrastructure.

The constraint is not only environmental, but also geographic and geopolitical. The energy necessary for compute depends on concentrated supply chains and energy markets exposed to international frictions. When instability in strategic areas for the transit of energy translates into volatility in operating costs, the diversification of the sources and infrastructures becomes a strategic priority, not only environmental but for resilience.

EARTH’S ORBITS AS THE NEW DIGITAL FRONTIER

In this context, space-based data centers, Earth-orbiting satellites designed to store and process data, are emerging as a possible infrastructure evolution: not as an alternative intended to replace ground-based data centers, but as an additional layer capable of extending their capabilities, reducing workloads and increasing resilience. A complementary approach instead of a competitive one.

Technical advantages of orbital data centers: energy and cooling

The space environment offers favourable conditions for intensive computing. In orbit, solar panels can generate up to eight times more energy than terrestrial installations, given the absence of the atmosphere and day/night cycles. The vacuum of space enables passive cooling of systems, eliminating dependence on water, one of the most critical resources for terrestrial datacenters.

Access-to-space costs: the economic evolution making the model viable

The key element of the economic equation is the cost to access space. Over fifteen years, the cost per kilogram to low Earth orbit has fallen from more than USD 50,000 to approximately USD 1,500 thanks to the reusable launch vehicles¹. With a new generation of launchers, the costs could decrease to less than USD 200/kg by the end of the next decade². At that price level, the launch cost amortized over the satellite’s operational lifetime would become comparable to the annual energy expenditure incurred by a terrestrial data center to power an equivalent computing capacity².

FROM GROUND-BASED PROCESSING TO ORBITAL COMPUTING: A PARADIGM SHIFT FOR DATA CENTERS

The long-term vision is a hybrid infrastructure, distributed between Earth's surface and its orbit, introducing a new level of digital sovereignty: the ability to process data beyond national borders and terrestrial geopolitical tensions, reducing dependence on increasingly fragmented supply chains.

The orbital data center market: size and outlook to 2035

The orbital data center market, while still in its early stages, is estimated to reach approximately USD 1.8 billion by 2029, with projections rising to USD 39 billion by 2035³.

AI for deep space exploration

A similar logic extends extends to the human exploration of deep space. Communication signals between Earth and Mars require minutes. As a result, real-time control of robots from Earth is challenging. Deploying AI computing capabilities in space, for example in Mars orbit, would enable these systems to operate autonomously without waiting for instructions from Earth. In this way, artificial intelligence has the potential to make human space exploration safer, more cost-effective, and feasible on a scale that would otherwise be unattainable.

SPACE ECONOMY AND CAPITAL MARKETS: THE ROLE OF FINANCE IN THE SPACE ECONOMY

The development of orbital data centers could give rise to a new infrastructure asset class, creating a point of convergence between the space economy and the capital markets. Their deployment would open the space sector to investment models typical of real assets and large-scale terrestrial infrastructure, significantly broadening the pool of potential investors.

Bringing these infrastructures from the design stage to reality will require significant investments and strong integration across technological, industrial, and financial expertise, ranging from launch systems to optical communication systems, from space hardware to cloud computing platforms — all areas at the core of Intesa Sanpaolo Innovation Center’s report on Space Logistics. It is in this context that the role of specialized financial intermediaries becomes crucial, not only in mobilizing capital, but also supporting, throughout the entire value chain, the players who are building this infrastructure.

The IMI Corporate & Investment Banking Division of Intesa Sanpaolo partners with a wide range of international players in the space and satellite sectors, supporting their investment, financing, and growth initiatives.

SOURCE

1 Jones, H. (2018, July). The recent large reduction in space launch cost. 48th International Conference on Environmental Systems

2 Beals, T. (2025). Exploring a space-based scalable AI infrastructure system design.

3 BIS Research, February 2026.

4 Acket-Goemaere, A., Brukardt, R., Klempner, J., Sierra, A., & Stokes, B. (2024). Space: The $1.8 trillion opportunity for global economic growth. McKinsey & Company.

F.A.Q.

What are data centers?

Data centers are physical infrastructures that host servers, storage systems and networking equipment used to process, manage and distribute data at scale. They form the physical backbone of the digital economy, supporting cloud services, streaming platforms, banking systems, and artificial intelligence models.

Their operation requires large amounts of electricity and water to cool the servers.

What is meant by space-based data centers?

Space-based data centers are computing infrastructures located in Earth orbit, designed to process data directly in space, with a particular focus on running inference for large language models (LLMs). Rather than operating as isolated assets, they are envisioned as constellations of satellites working in a coordinated manner, replicating in orbit the distributed architecture of terrestrial data centers.

This approach enables the gradual scaling of computing capacity, much like fiber-optic networks expanded global connectivity over time. Space-based data centers are therefore best understood as a complementary layer of computing infrastructure, augmenting rather than replacing terrestrial data centers.

What is the space economy?

The space economy encompasses all economic activities related to the exploration, utilisation and commercialisation of space. It includes the development of launch vehicles, satellites, Earth observation systems, space-based telecommunications, and, more recently, orbital computing infrastructure. According to recent estimates, the global space economy has already surpassed USD 600 billion in value⁴.

What are the advantages of space-based data centers compared with terrestrial ones?

Orbital data centers are inherently energy self-sufficient. Unlike terrestrial facilities, they do not rely on fossil fuels, ground-based solar farms, or wind power installations to meet their energy needs. Instead, they harvest energy directly from sunlight through solar arrays mounted on the spacecraft, benefiting from near-continuous exposure and avoiding many of the inefficiencies associated with the Earth’s atmosphere and day–night cycles.

A similar principle applies to cooling: the space environment enables heat rejection through radiative thermal management, eliminating the dependence on water, one of the most critical and increasingly constrained resources in conventional data center operations. Beyond these benefits, orbital data centers also offer geographic redundancy and greater resilience to terrestrial geopolitical, infrastructure, and energy-related disruptions.

How have the costs of access to space changed?

Over the past fifteen years, the cost of delivering payloads to low Earth orbit has fallen from more than USD 50,000 per kilogram to approximately USD 1,500 per kilogram with today’s reusable launch vehicles. With the next generation of launch systems, this cost could fall below USD 200 per kilogram by the mid-2030s, progressively improving the economic viability of orbital infrastructure and making the trade-off between launch costs and long-term energy savings increasingly sustainable.

What is the estimated value of the orbital data center market?

According to BIS Research (February 2026), the orbital data center market is projected to reach approximately USD 1.8 billion by 2029, with forecasts indicating growth up to USD 39 billion by 2035. While the sector remains at an early stage of development, its growth trajectory is expected to be driven by the convergence of two trends: the demand for AI computing capacity and the decline in the cost of accessing space.