A new FCC filing from Bezos-owned Blue Origin just heated 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 an 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 requested FCC to deny it
Between the lines: Analysts weigh in on the biggest picture
Another day, another head-scratching twist in the satellite industry.
Just after weeks of objecting to Elon Musk’s petition for building a colossal satellite constellation for space-borne data centers, Jeff Bezos 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 between 500 kilometer and 2,000 km in altitude and “sun-synchronous orbit inclinations”. “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 is 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”. BO’s application proposes to place the satellites between 500 and 1800 km, with each orbital plane carrying 300 to 1,000 satellites.
It’s almost like a countermove, and SpaceX hasn’t missed that. In fact, SpaceX followed up with another letter to the FCC, asking both applications be treated equally as Blue Origin said in its application that they 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. “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 three to five 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.
A moonshot?
As for the whole space data center shebang, skepticism around the concept is growing louder. Gartner’s VP analyst, Bill Ray used the phrase “peak insanity” to describe the state of the competition. 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 some very fundamental challenges: vertical lunch capabilities are limited, current data center technologies cannot withstand cosmic radiation of the space, there are significant engineering hurdles around cooling and networking, and economics remain a sticking point, which 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,” the report summarized.
Even OpenAI CEO Sam Altman has joined the chorus. Sometime back, Altman called the idea “ridiculous” adding that “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: The competition between Amazon and SpaceX is increasingly about vertical integration. Pearce noted that Blue Origin could move closer to Starlink’s vertically integrated model with the New Glenn launch vehicle, although the balance could ultimately tilt in favor of SpaceX’s Starship because of lower cost per launch and greater capacity.
Regardless, Blue Origin’s plan to enter the orbital data center race turns it into a competitive front, one in which the biggest player wins. As Pearce said, “It places Blue Origin in more direct competition with SpaceX in a race to make the underlying science and economics viable.”
While the Amazon-owned AWS infrastructure evidently gives Blue Origin an edge over SpaceX, and SpaceX is leveraging its first-mover advantage, both players will still have to compete with other space-based initiatives like the Axiom Orbital Data Center, Nvidia-backed Starcloud and Google’s Suncatcher that are already in the works.
