Sam Altman and Elon Musk: Will The Data Center in Space
- Sam Altman explored a multi-billion dollar deal to acquire rocket maker Stoke Space to build solar-powered orbital data centers but talks are now inactive.
- OpenAI has declared a "code red" and delayed its advertising product to focus on fixing ChatGPT’s performance amid market share losses to Google Gemini.
- The startup faces financial scrutiny over $600 billion in computing commitments while Google advances its own space-based AI plans with Planet Labs.
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| Image From WSJ |
The visionary ambitions of Sam Altman have hit a harsh reality check. The OpenAI chief executive had been quietly exploring a massive expansion into the aerospace sector to solve his company’s future energy needs. Sources confirm that Altman engaged in advanced talks to acquire or partner with Stoke Space. This deal would have positioned him as a direct rival to Elon Musk’s SpaceX. The plan was audacious. He aimed to build orbital data centers that could harvest the sun’s unlimited power to run the next generation of artificial intelligence.
These talks are now dead. The discussions with the rocket maker have ceased as OpenAI grapples with a severe internal crisis. Management has declared a "code red" situation to save their core product. ChatGPT has begun losing critical market share to Google’s Gemini chatbot. The company is now scrambling to fix performance issues rather than dreaming of the stars. This emergency has forced an immediate delay in the rollout of new revenue streams including a highly anticipated advertising platform and a personal assistant named Pulse.
Altman’s flirtation with rocketry was driven by a terrifying mathematical projection. He believes that the energy required to power future AI systems will eventually exceed what Earth’s grid can sustainably provide. He even floated the idea of a "Dyson sphere" during a podcast with Theo Von. This hypothetical megastructure would capture a star's energy output to power civilization. He argued that it makes little sense to keep these energy hungry machines on the planet in the long run. Orbital data centers would solve the power bottleneck that currently threatens the industry's growth.
Stoke Space was the target because of its reusable technology. The company was founded by former Blue Origin employees and is developing a fully reusable rocket called Nova. A partnership here would have been a direct shot at Musk who dominates the launch market. It would have opened a new front in their deepening rivalry which already spans AI with Musk’s xAI and brain computer interfaces where Altman’s Merge Labs competes with Neuralink.
The financial pressure on OpenAI is mounting. The startup has signed nearly $600 billion in computing commitments with partners like Oracle and Microsoft. These massive liabilities were based on the assumption of endless growth that is now in question. The market has reacted violently to the uncertainty. Shares of key partners like Oracle and Nvidia have tumbled recently. Nvidia’s CFO even clarified that a reported $100 billion deal with OpenAI has not yet been finalized. Investors are souring on the narrative of expansion at any cost
Google is not waiting for Altman to figure out his space strategy. The search giant has already struck a concrete deal with satellite operator Planet Labs. They plan to launch prototype satellites equipped with Google’s custom AI chips by 2027. This project known as "Project Suncatcher" aims to prove that data centers can operate in the harsh environment of orbit. It is a pragmatic step that contrasts sharply with Altman’s stalled billion dollar buyout attempt.
The "code red" at OpenAI signals a significant strategic pivot. The company is pulling resources from experimental teams to reinforce the chatbot’s reliability and speed. Employees are being temporarily transferred to the core product team. The dream of a vertically integrated empire that spans from chips to rockets has been put on hold. Altman must now prove he can win the ground war against Google before he can conquer the sky.