12 Apr Leaving the Clouds Behind

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March 2026 Insights

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Leaving the Clouds Behind

The world’s most powerful technology firms are entering a new space race, as compute infrastructure builders look towards the stars. SpaceX recently filed with the US Federal Communications Commission (FCC) to launch one million satellites, while firms like Blue Origin and Axiom also plan for massive orbital data centre constellations. While NVIDIA recently unveiled its Space-1 Vera Rubin module to bring AI to orbit, Google’s “Project Suncatcher” has provided the most rigorous technical validation to date. By testing their latest Trillium TPUs against proton beams, Google researchers confirmed that high-end AI chips are surprisingly resilient to cosmic radiation, surviving triple the expected five-year mission dose. This move from speculative “moonshot” to viable engineering suggests that space-based compute is no longer a question of if, but when.

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Historically, computing has followed energy, with data centres clustered around cheap power sources like hydroelectric power in the Pacific Northwest and geothermal energy in Iceland. Companies are now extending this logic even further: moving compute directly to the most abundant energy source available. In the right orbit, a solar panel is up to eight times more productive than on Earth, providing near-continuous power without the regulatory hurdles or water-intensive cooling requirements of terrestrial locations. As rocket launch costs fall toward a projected cost inflection near $200/kg, shifting compute into orbit could become strategic infrastructure rather than science fiction.

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However, the transition involves significant trade-offs, and formidable engineering challenges remain. While the frigid vacuum of space seemingly offers attractive cooling capabilities, it is actually a notoriously difficult environment for thermal management: without air for convection, heat must be bled off via massive, fragile infrared radiators. Furthermore, the sheer scale of proposed networks raises urgent environmental concerns about orbital debris and the degradation of the night sky for global astronomy. Sceptics like OpenAI’s Sam Altman argue that the economics and logistics are not yet feasible at scale. Even so, the investment thesis is compelling. Rapid advances in launch, semiconductor design, and satellite networks suggest that space may become the next critical frontier for the global compute economy.

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Unless otherwise stated, all performance and statistical figures provided in this article have been pulled from Bloomberg by the High Street Asset Management Research Team on 4 April 2026 and all the images provided in this article have been sourced from FreePik and have been used in line with their Acceptable Use Policy. The contents of our newsletters are frequently sourced from or verified through our various product providers and other third parties. Although every effort is made to ensure the accuracy of the information contained in the newsletter, it should not be construed as financial advice as defined in the Financial Advisory and Intermediary Services Act. Links are provided to third-party websites for convenience only. High Street Asset Management (Pty) Ltd cannot accept responsibility and does not endorse any information contained on a third-party site. For our full disclaimer, please see: https://hsam.co.za/legal/.

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