A new FCC filing from Blue Origin is heating up competition between the two wealthiest men on Earth
In sum — what to know:
Regulatory chess: In what feels like a chessboard move, Blue Origin requested FCC’s approval for 51,000 satellites for building its own orbital data center.
Blue Origin’s objection: The application came just weeks after Blue Origin criticized SpaceX’s petition for space-borne data centers and urged the FCC to deny it.
Between the lines: Analysts weigh in on the big picture.
Another day, another twist in the satellite industry.
After just weeks of objecting to Elon Musk-owned SpaceX’s petition for building a colossal satellite constellation for space-borne data centers, Jeff Bezos’ Blue Origin is asking regulators for permission to build one of his own.
The FCC filing saga continues
First, in late January, SpaceX sought FCC approval to launch a staggering 1 million satellites in sun-synchronous orbits between 500 and 2,000 km in altitude. “Orbital data centers are the most efficient way to meet the accelerating demand for AI computing power,” SpaceX wrote in its filing, noting the surging energy demands of terrestrial AI infrastructure.
Then, earlier this month, Amazon pushed back, calling the application “incomplete, speculative, and unrealistic” and arguing that it only amounted to a “”speculative placeholder rather than a complete application under the Commission’s rules.” It urged the FCC to deny the request which it is already reviewing for potential approval.
SpaceX’s application by that point had already received significant backlash from people concerned over frequent launches impacting the Earth’s atmosphere. For its part, SpaceX addressed the criticism with a phased deployment plan, saying it would monitor atmospheric effects and implement “necessary adjustments” as it scales.
Now Bezos’ Blue Origin has filed for approval to launch 51,600 satellites as part of an orbital data center project dubbed “Project Sunrise”. The application proposes to place the satellites between 500 and 1800 km, with each orbital plane carrying 300 to 1,000 satellites.
It almost feels like a countermove to SpaceX’s at this point, and SpaceX hasn’t missed that. In fact, SpaceX followed up with a letter to the FCC, asking both applications be treated equally as Blue Origin has urged in its filing (It said both applications are ‘similarly situated’), despite suggesting earlier that SpaceX’s filing was “unrealistic”.
Ironically, Blue Origin’s filing is also light on details, like technical specifications of the satellites, the amount of compute power Project Sunrise will generate, etc.. Blue Origin says it will use at least three antenna variations and rely on optical inter-satellite links via the TeraWave system and other backhaul networks for communication.
Still, compared to Musk’s, Bezos’ plan is “far more realistic”, says Luke Pearce of CCS Insight, a London-based telecom research company. “Jeff Bezos highlighted the opportunity last fall to develop orbital data centers within a couple of decades, which brought the concept into the mainstream,” he said. “Elon Musk followed with a much more aggressive timeline, suggesting it could be achieved within 3 to 5 years and helping to accelerate industry discussion. The latest filing shows that Blue Origin is looking to keep pace.”
That said, the petition at this stage is still just an application rather than a confirmed program — another entry in a growing list of “paper satellites” filed with the International Telecommunication Union (ITU) aimed to reserve radio spectrum and orbital resources. “It does, however, signal that Blue Origin is evaluating the opportunity and engaging with regulators,” Pearce added.
Pie in the sky
As for the whole space data center shebang, skepticism around the concept is growing louder. Gartner’s VP analyst, Bill Ray went viral when he said the space data center race has reached “peak insanity” in his report, Orbital Datacenters Won’t Serve Terrestrial Needs, so Focus on Earth. Ray wrote, “Companies are wasting money by pouring funds into the orbital datacenter ‘bubble’ because the economics do not work.”
Despite the promised earthly benefits, the concept itself is fraught with fundamental challenges: vertical lunch capabilities are limited, current data center technologies cannot withstand cosmic radiations in the space, there are significant engineering hurdles around cooling and networking, and economics remain a sticking point — all of which seem to suggest that “much of the current discourse is geared toward investor appeal, particularly ahead of a potential SpaceX IPO this year,” Pearce said.
“These orbital data centers will not analyze terrestrial data for terrestrial applications for decades, a reality that should prompt product leaders to focus instead on expanding data centers on Earth,” Ray’s report summarized.
Even OpenAI CEO Sam Altman joined the chorus. Sometime back, Altman was quoted saying that the idea is “ridiculous” and that the “space is great for a lot of things. Orbital data centers are not something that’s going to matter at scale this decade.”
One thing is clear in all this: Whether or not non-terrestrial data centers come to be in the foreseeable future, the competition between Blue Origin and SpaceX will continue to get hotter as the two titans fight for vertical integration. Pearce noted that the New Glenn launch vehicle could move Blue Origin closer to Starlink’s vertically integrated model, although the balance could ultimately tilt in favor of SpaceX as Starship offers lower cost per launch and greater capacity.
Regardless, Blue Origin’s plan to enter the orbital data center race turns the market into an even more competitive front, one in which players that are ahead have the responsibility to prove the concept. As Pearce said, “It places Blue Origin in more direct competition with SpaceX in a race to make the underlying science and economics viable.”
However, while SpaceX has an early-mover advantage here, and for Blue Origin, the Amazon-owned AWS infrastructure evidently gives it an edge over SpaceX, both players will still have to compete with a growing number of space-based initiatives, like the Axiom Orbital Data Center, Nvidia-backed Starcloud and Google’s Suncatcher, that are already in the works.
