Space Race 2.0: China and SpaceX Battle for Orbital AI Dominance

The New Space Race Is About Computing Power

China and SpaceX are locked in a battle for dominance in what could become the most significant technological infrastructure of the century: orbital data centres designed to power artificial intelligence.

The China Aerospace Science and Technology Corporation announced plans to construct gigawatt-class space digital-intelligence infrastructure over the next five years. The initiative aims to create an industrial-scale Space Cloud by 2030, processing data in orbit rather than transmitting it back to Earth.

SpaceX's Million-Satellite Vision

SpaceX has filed with the Federal Communications Commission seeking authorisation to launch up to one million satellites for an orbital data centre constellation. While the company is unlikely to deploy that many, the filing signals its serious ambitions in space-based computing.

Elon Musk declared at the World Economic Forum that building solar-powered AI data centres in space is a no-brainer, predicting that within two to three years, space will become the lowest-cost location for AI infrastructure.

Why Move Computing to Space

Terrestrial data centres face mounting challenges. They require enormous amounts of electricity and generate significant heat requiring expensive cooling systems. In orbit, satellites can harness near-constant solar power while radiating heat into the vacuum of space.

China plans a central space data centre in a dawn-dusk orbit at seven hundred to eight hundred kilometres altitude, with power capacity exceeding one gigawatt. Test satellites are scheduled for launch by early 2026, with a full-scale orbital data centre targeted for 2035.

National Security Dimensions

Chinese aerospace officials have characterised SpaceX's dominance in low Earth orbit as a national security threat. Researchers affiliated with the People's Liberation Army have warned that Starlink satellites could become deeply integrated into the American military combat system.

In December, Chinese entities filed plans with the International Telecommunication Union to deploy approximately two hundred thousand satellites over fourteen years, securing orbital slots and radio frequencies for their own constellations.