Deutsche Bank sees SpaceX orbital data centers matching ground costs By Investing.com

Investing.com -- Deutsche Bank released analysis on Tuesday suggesting SpaceX could achieve cost parity between orbital and terrestrial data centers by the early 2030s through vertical integration and scaled Starship launches.

The bank examined SpaceX's Starmind constellation, which will use AI1 satellites equipped with optical inter-satellite links to route traffic through the existing Starlink network. The AI1 satellites will not require complex phased-array antennas, relying instead on optical terminals for communication with possible Ka-band backup for telemetry.

Deutsche Bank estimates more than 10,000 Starlink satellites are currently in orbit, with V2 mini satellites each carrying three optical terminals capable of handling approximately 600 gigabits per second of capacity. The bank anticipates V3 satellites may have at least 2-3 terabits per second of capacity per satellite.

Leading providers of optical terminals include Tesat-Spacecom, a subsidiary of Airbus, Mynaric, SA Photonics, which CACI acquired in 2021, and SpaceX itself.

SpaceX is utilizing E-band, V-band, W-band, and proposed D-band spectrum for gateway backhaul, in addition to traditional Ku and Ka bands. The FCC recently adopted new standards replacing 1990s-era limits, which Deutsche Bank said could allow up to seven times more capacity from the same number of satellites.

SpaceX is building a solar cell manufacturing facility in Bastrop, Texas, targeting 10 gigawatts of capacity across two floors. Construction began in late March, with equipment installation underway. The plant aims for production ramp-up by the end of 2027, initially producing silicon solar cells with approximately 19% efficiency.

The AI1 satellite will use a double-sided active deployable liquid radiator covering 110 square meters, capable of dissipating 1,400 watts per square meter. SpaceX is targeting prototype deployments of AI1 satellites late next year, with FCC filings outlining a constellation of up to one million satellites in low Earth orbit.

Each AI1 satellite is expected to run at approximately 120 kilowatts, similar to the power consumption of a NVIDIA GB300 NVL72 rack. SpaceX expressed openness to hosting Nvidia GPUs, Google TPUs, Amazon Trainium, and Tesla AI chips.

Deutsche Bank estimates upfront capital expenditure for 1 gigawatt of AI compute on the ground is $38 billion with $900 million in annual operating expenses, totaling $42.5 billion over five years based on Epoch AI analysis.

The bank calculates that deploying a 1 gigawatt space data center constellation would currently cost six times more than terrestrial alternatives excluding compute costs. This gap could narrow to 1.0-1.5 times by the end of the decade and become cheaper in the early-to-mid 2030s through Starship reusability and satellite optimization.

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