US startup Starcloud this week sent a refrigerator-sized satellite containing an Nvidia graphics processing unit (GPU) into orbit in what the AI chip maker touted as a "cosmic debut" for the mini-data center.
"The idea is that it will soon make much more sense to build data centers in space than it does to build them on Earth," Starcloud chief executive Philip Johnston said at a recent tech conference in Riyadh.
Along with a constant supply of solar energy, data centers are easier to cool in space, advocates note.
Announcements have come thick and fast, the latest being Google this week unveiling plans to launch test satellites by early 2027 as part of its Suncatcher project.
That news came just days after tech billionaire Elon Musk claimed his SpaceX startup should be capable of deploying data centers in orbit next year thanks to its Starlink satellite program.
Starcloud's satellite was taken into space by a SpaceX rocket on Sunday.
- Junk and radiation -
Current projects to put data centers into orbit envision relying on clusters of low Earth orbit satellites positioned close enough together to ensure reliable wireless connectivity.
Lasers will connect space computers to terrestrial systems.
"From a proof concept, it's already there," University of Arizona engineering professor Krishna Muralidharan, who is involved with such work, said of the technology.
Muralidharan believes space data centers could be commercially viable in about a decade.
Amazon founder Jeff Bezos, the tech titan behind private space exploration company Blue Origin, has estimated it might take up to twice that long.
Critical technical aspects of such operations need to be resolved, particularly harm done to GPUs by high levels of radiation and extreme temperatures as well as the danger of being hit by space junk.
"Engineering work will be necessary," said University of Michigan assistant professor of engineering Christopher Limbach, contending that it is a matter of cost rather than technical feasibility.
- Sun synched -
The big draw of space for data centers is power supply, with the option of synchronizing satellites to the sun's orbit to ensure constant light on solar panels.
Tech titans building AI data centers have ever-growing need for electricity, and have even taken to investing in nuclear power plants.
Data centers in space also avoid the challenges of acquiring land and meeting local regulations or community resistance to projects.
And advocates argue that data centers operating in space are less harmful overall to the environment, aside from the pollution generated by rocket launches.
Water needed to cool a space data center would be about the same amount used by a space station, relying on exhaust radiators and re-using a relatively small amount of liquid.
"The real question is whether the idea is economically viable," said Limbach.
An obstacle to deploying servers in space has been the cost of getting them into orbit.
But a reusable SpaceX mega-rocket called Starship with massive payload potential promises to slash launch expenses by at least 30 times.
"Historically, high launch costs have been a primary barrier to large-scale space-based systems," Suncatcher project head Travis Beals said in a post.
But project launch pricing data suggests prices may fall by the mid-2030s to the point at which "operating a space-based data center could become comparable" to having it on Earth, Beals added.
"If there ever was a time to chart new economic paths in space -- or re-invent old ones -- it is now," Limbach said.
Microsoft unveils $15.2 billion AI investments in UAE
Abu Dhabi (AFP) Nov 3, 2025 -
US tech giant Microsoft on Monday announced $15.2 billion in investments in artificial intelligence and cloud computing in the United Arab Emirates.
Microsoft's vice chairman and president Brad Smith said Microsoft had invested $7.3 billion in the Gulf country since 2023 and would spend $7.9 billion more by the end of 2029.
The deal sent US chip-maker Nvidia shares up 2.6 percent, buoyed by hopes the AI juggernaut could see access for its most advanced chips expand to more markets.
"This is not money raised in the UAE. It's money we're spending in the UAE," Smith wrote in a blog post published during a visit to Abu Dhabi.
Smith said the investments had been encouraged by both the US and UAE governments and had involved a partnership with the country's G42 sovereign artificial intelligence company.
Roughly two-thirds of the money spent will go on building AI and cloud data centres in the UAE, and a third of it on planned local operating expenses.
In the blog post, Smith boasted that Microsoft was the first company to receive export licences from President Donald Trump's administration to supply GPU chips to the UAE.
In some cases, Washington has restricted international access to some of American industry's most advanced processors of the type that can run the latest AI models.
The UAE is a close US ally and popular investment destination but Washington is keen to avoid seeing the most advanced chips evade export controls and end up with rivals such as China.
Microsoft hailed the "substantial work we did to meet the strong cybersecurity, national security, and other technology conditions required by these licenses."
Updated licences granted in September allow the firm to "ship the equivalent of 60,400 additional A100 chips ... involving Nvidia's even more advanced GB300 GPUs."
"We're using these GPUs to provide access to advanced AI models from OpenAI, Anthropic, open-source providers and Microsoft itself," Smith said.
OpenAI seeks government backing to boost AI investments
San Francisco, United States (AFP) Nov 5, 2025 -
ChatGPT creator OpenAI, the world's largest private company, is asking the US government to provide loan guarantees for its massive infrastructure expansion that will eventually cost more than $1 trillion.
Speaking at a Wall Street Journal business conference, OpenAI CFO Sarah Friar explained that government backing could help attract the enormous investment needed for AI computing and infrastructure, given the uncertain lifespan of AI data centers.
"This is where we're looking for an ecosystem of banks, private equity, maybe even governmental," Friar said.
Federal loan guarantees would "really drop the cost of the financing," she explained, enabling OpenAI and its investors to borrow more money at lower rates to meet the company's ambitious targets.
The proposal -- unusual for a Silicon Valley tech giant -- would theoretically reduce OpenAI's borrowing costs since the government would absorb losses if the company defaulted.
Such guarantees would also dramatically expand OpenAI's potential lender pool, as many banks and financial institutions face strict limits on high-risk lending.
OpenAI's request for government support comes amid a massive spending spree on computing infrastructure, raising questions about how the company will recoup these investments.
By some estimates, OpenAI has committed to approximately $1 trillion in infrastructure deals this year alone, including a $300 billion partnership with Oracle and a $500 billion Stargate project with Oracle and SoftBank.
While the company expects revenues in the tens of billions this year -- impressive for any startup -- that figure falls far short of covering the computing costs required to power OpenAI's advanced chatbots.
During the interview, Friar dismissed reports that OpenAI plans to go public soon.
"IPO is not on the cards right now," she said, emphasizing that the company's current priority is growth.
Recent media reports had suggested OpenAI was preparing for a public offering after completing a complex governance restructuring that would allow the company to accept public shareholders on Wall Street.
OpenAI signs $38 bn infrastructure deal with cloud giant AWS
Washington (AFP) Nov 3, 2025 -
ChatGPT-maker OpenAI signed a $38 billion deal Monday with Amazon's AWS cloud computing arm, as the artificial intelligence company continues on a major partnership spree that has also included Oracle, Broadcom, AMD and chip-making juggernant Nvidia.
Under the seven-year agreement, OpenAI, which is partly owned by AWS's archrival Microsoft, will gain access to computing resources including hundreds of thousands of state-of-the-art Nvidia GPUs, the crucial component of the generative artificial intelligence revolution.
The deal, which will grow over its multi-year term, will also give access to tens of millions of more conventional CPUs that will be used for the everyday deployment of so-called agentic AI.
"Scaling frontier AI requires massive, reliable compute," said OpenAI co-founder and CEO Sam Altman in a joint statement. "Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone."
OpenAI will immediately begin utilizing AWS computing, with all capacity targeted to be used before the end of 2026, and the ability to expand further in the coming years.
By some estimates, OpenAI has inked approximately $1 trillion worth of infrastructure deals in 2025, including a $300 billion Oracle deal and a $500 billion Stargate project with Oracle and SoftBank.
The massive infrastructure spending comes as revenues in 2025 are expected to be in the tens of billions this year, a very high figure for a startup, but far from the amount needed to recoup the costs of computing needed to power OpenAI's powerful chatbots.
The deal was the first one since OpenAI formalized its new structure, in which the company has a freer hand to move away from its non-profit origins and deliver profits for its investors.
The partnership with AWS builds on existing collaboration between the companies, with OpenAI's more open-source models already available on Amazon servers.
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