SpaceX targets 2027 for orbital data centers, but hurdles remain

Evelyn Chow, a portfolio manager at Neuberger, called orbital data centers "a next-decade event." "We'll need to see significant satellite launches over the next four to five years, and a concomitant buildout of connectivity, before we can start to contemplate true scale in orbital data centers," she told CNBC's "Squawk Box Asia."

Blaine Curcio, founder of Orbital Gateway Consulting, called the 2030s timeline a "fair assessment," but cautioned that SpaceX has a record of exceeding expectations. "Had you asked any satellite industry expert in the late 2010s whether SpaceX could launch 10,000 satellites by 2025, every single one of them, myself included, would have said 'no chance,'" he said.

The hurdles are substantial. Chow said cooling is a huge issue, because terrestrial data centers use liquid cooling, but cooling works differently in space's vacuum. Systems also need to tolerate radiation. Curcio noted that GPUs are evolving so rapidly that a state-of-the-art data center launched at enormous cost could be obsolete in a couple of years.

Data transmission is another challenge. Transcelestial, a company specializing in laser-based communications, is working to get high-volume data back to Earth. "Anyone can build data centers, but if you can't talk to these AI systems, then those data centers are useless," said CEO and cofounder Rohit Jha. Jha also said orbital data centers could take another five to seven years to reach hyperscale, a level that would likely require nuclear power.