Masayoshi Son Dismisses Musk’s Idea for Orbital Data Centers

Masayoshi Son Photographer: Akio Kon/Bloomberg Photo by Akio Kon /Bloomberg

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(Bloomberg) — SoftBank Group Corp. founder Masayoshi Son said there’s little merit to building data centers in space, as championed by Elon Musk, predicting that the AI race will be clinched by compute on Earth.

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The main advantage of building data centers in space would be to slash electricity costs. But such expenses comprise a small fraction of the cost of operating data centers, compared with hardware like chips, Son said during an annual shareholder meeting for SoftBank’s mobile unit on Tuesday. The tradeoff for any power cost reductions would also include higher fees to transport everything into space, maintenance and communication delays, he added.

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“In the battle for AI, the next few years will be far more important than what might happen a decade or so from now,” he said after a SoftBank Corp. shareholder asked if the Japanese company planned anything similar to the SpaceX chief’s grandiose plans. 

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While calling Musk a “remarkable agent of change,” Son said that SoftBank will focus on building “formidable” data center capacity on Earth. “He who strikes first wins,” he said.

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The Japanese tech investor has committed about $65 billion to OpenAI and has also pledged to direct hundreds of billions of dollars into building data centers and related infrastructure around the globe. But as demand for computing power grows, both SpaceX and Jeff Bezos’ Blue Origin have announced plans to build and launch orbital data centers to beat energy and space constraints on the planet.

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Son also acknowledged that AI competition is intensifying, but said that there was more than enough room for growth for OpenAI and its biggest rivals Anthropic PBC and Google. AI is still in its early stages with scope for “ten-fold, a hundred-fold” growth, he said.

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Separately, SoftBank’s telecom unit is also preparing forays into the neocloud and data center storage battery markets in the US, according to Junichi Miyakawa, who heads the unit, Japan’s third-largest wireless carrier. The Japanese neocloud business is scheduled for launch this year. 

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—With assistance from Ville Heiskanen.

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(Updates with details.)

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