Why Earth data centers face energy and water limits

As constraints on energy, water, and permitting collide with exploding demand for AI and compute, a once-fringe idea is moving rapidly toward the center of the conversation: putting data centers in space. Starcloud believes orbital infrastructure isn’t science fiction—it’s a necessary extension of the global compute stack if scaling is going to continue at anything close to its current pace.

Founded by Philip Johnston, Starcloud is building space-based compute systems designed to compete on cost, performance, and scale with terrestrial data centers. The company has already flown a data center–grade GPU in orbit and is now working toward larger, commercially viable systems that could reshape where and how AI is powered.

We discuss:

How energy and permitting constraints are reshaping the future of compute

Why space-based data centers may be economically inevitable, not optional

What Starcloud proved by running an H100 GPU in orbit

How launch costs, watts-per-kilogram, and chip longevity define the real economics

The national security implications of who controls future compute capacity

• Chapters •

00:00 - Intro
00:50 - The issue with data centers
02:20 - Explosion of the data center debates
04:58 - Philip's 5GW data center rendering and early conceptions of data centers in space at YC
08:16 - Proving people wrong
11:17 - The team at Starcloud today
12:29 - Competing against SpaceX's data center
14:42 - Sam Altman's beef with Starlink
16:52 - Economics of Orbital vs Terrestrial Data Centers by Andrew McCallip
21:33 - Where are we putting these things?
23:50 - Latency in space
25:59 - Political side of building data centers
28:36 - Starcloud 1
30:16 - Space based processors
30:51 - Shakespeare in space
32:00 - Hardening an Nvidia H100 against radiation and making chips in space economical
34:43 - Cooling systems in space
36:01 - How Starcloud is thinking about replacing failed GPUs
38:46 - The mission for Starcloud 2
40:05 - Competitors outside of SpaceX
40:49 - Getting to economical launch costs
44:35 - Will the next great wars be over water and power for data centers?
46:25 - What keeps Philip up at night?
47:11 - What keeps Mo up at night?

• Show notes •

Starcloud’s website — https://www.starcloud.com/
Philip’s socials — https://x.com/PhilipJohnston
Mo's socials — https://x.com/itsmoislam
Payload’s socials — https://twitter.com/payloadspace / https://www.linkedin.com/company/payloadspace
Ignition’s socials — https://twitter.com/ignitionnuclear /  
https://www.linkedin.com/company/ignition-nuclear/
Tectonic’s socials — https://twitter.com/tectonicdefense / https://www.linkedin.com/company/tectonicdefense/
Valley of Depth archive — Listen: https://pod.payloadspace.com/

• About us •

Valley of Depth is a podcast about the technologies that matter — and the people building them. Brought to you by Arkaea Media, the team behind Payload (space), Ignition (nuclear energy), and Tectonic (defense tech), this show goes beyond headlines and hype. We talk to founders, investors, government officials, and military leaders shaping the future of national security and deep tech. From breakthrough science to strategic policy, we dive into the high-stakes decisions behind the world’s hardest technologies.

• Payload: www.payloadspace.com
• Tectonic: www.tectonicdefense.com
• Ignition: www.ignition-news.com