What's the point of AI data centres in space? SoftBank CEO thinks Elon Musk plan is no good

SoftBank's founder Masayoshi Son has dismissed Elon Musk's vision of orbital data centres. Masayoshi believes that there is no real benefit to having them in space.

In Short

• SoftBank founder slams Elon Musk's idea of data centres in space
• Masayoshi Son believes orbital data centres don't really bring any benefit
• Masayoshi plans to win AI race with data centres on Earth

As we use more AI tools, the demand for data centres has increased drastically. These data centres are necessary as they provide computing power that actually runs AI models. But data centres are expensive to run, particularly when it comes to electricity. To tackle this, tech trillionaire Elon Musk wants to set up data centres in space. However, SoftBank founder Masayoshi Son believes that this idea may not really be feasible. Instead, he wants to win the AI race with more data centres on Earth.

At the annual shareholder meeting of SoftBank Corp, the group’s mobile unit, Masayoshi Son was asked whether SoftBank planned anything similar to Musk’s orbital data centres. Masayoshi replied, as quoted by Bloomberg, “What’s the point? What’s the benefit of building AI data centre in space?”

According to the Softbank chief, what happens in the short-term was more important in the AI race. He added, “In the battle for AI, the next few years will be far more important than what might happen a decade or so from now.” The SoftBank founder added, “He who strikes first wins.”

Why SoftBank does not want orbital data centres?

Masayoshi acknowledged that Musk was a “remarkable agent of change.” However, he insisted that SoftBank was focused on building “formidable” data centre capacity on Earth.

The SoftBank chief said that the main benefit of putting data centres in space would be lower electricity costs, but argued that power makes up only a small part of the total cost of running AI infrastructure when compared with hardware such as chips.

According to a SoftBank translation of his remarks, electricity accounts for about 7 per cent of operating costs, with chips and other expenses making up the rest. He said any savings on power would be offset by the cost of transporting equipment into space, as well as maintenance, networking and latency-related challenges.

Do note that a major criticism of data centres on Earth is the high consumption of energy and water, something that has led to widespread backlash from residents in some areas.

The remarks come as SoftBank has committed about $65 billion to OpenAI and pledged hundreds of billions of US dollars for data centres and related infrastructure around the world. Masayoshi said competition in AI was intensifying, but added that there was enough room for OpenAI and major rivals including Anthropic and Google. He reckoned that AI was still in its early stages, with scope for “ten-fold, a hundred-fold” growth.

Elon Musk, Jeff Bezos want data centres in space

Son’s comments come against the backdrop of a broader push by Musk to tie AI more closely to his space business. SpaceX, which is now public, previously merged with Musk’s AI startup xAI as part of a wider vision of orbital data centres.

As part of that vision, Musk has spoken of launching a constellation of a million satellites operating as orbital data centres powered by solar energy, calling it a first step towards a Kardashev II-level civilisation.

The Kardeshev scale, proposed by Soviet astronomer Nikolai Kardashev in 1964, measures a civilisation's technological advancement based on the total amount of energy it can harness. A type II civilisation refers to a society which can harness the complete energy of its star.

Jeff Bezos’ Blue Origin has also announced plans for orbital data centres, while Bezos has described the idea as “very realistic.” OpenAI CEO Sam Altman, on the other hand, has previously labelled the concept of orbital data centers as "ridiculous."

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