SoftBank's Masayoshi Son sharply criticizes Musk's SpaceX: Space computing efficiency is extremely low; the surface of the Earth is the key to the AI competition.

SoftBank CEO Masayoshi Son criticizes Elon Musk's SpaceX space data center as extremely low efficiency, emphasizing that ground-based computing power is the key to the AI race, and SoftBank will focus on investing hundreds of billions of dollars in ground infrastructure.

SoftBank's Son slams Musk's SpaceX space computing narrative

After Musk's company SpaceX completed the largest IPO in history, the narrative of space computing heated up, but SoftBank Group CEO Masayoshi Son dismissed it.

At a recent shareholders' meeting for the mobile communications business, he questioned the concept of space data centers advocated by Musk, and stated that the actual benefits of building data centers in space are extremely low, and that the outcome of the artificial intelligence (AI) race will be determined by ground-based computing power.

He pointed out that while space data centers could reduce electricity costs, compared to chip hardware, electricity expenses account for a minimal portion of total operating costs. In contrast, the high costs of transporting materials to space, maintenance expenses, and communication latency will offset any savings on electricity.

Image source: Flickr, nobihaya photography 2008, Masayoshi Son at the SoftBank Mobile Summit

Son: Development in the next few years is more important than the next decade

In response to a shareholder's question about whether SoftBank would follow SpaceX's plan, Son responded that in the AI race, development in the next few years is far more important than what happens in ten-plus years. He believes SoftBank should focus on building powerful computing on the ground, emphasizing that striking first is the key to winning.

SoftBank has committed approximately $6.5 billion to OpenAI and plans to invest hundreds of billions of dollars globally in building ground-based data centers. At the same time, SoftBank is also a major supporter of the Stargate project led by OpenAI.

In January last year, Son announced SoftBank's initial commitment of $19 billion to the project, which is expected to invest a total of $500 billion over four years.

Additionally, SoftBank's telecom division president Junichi Miyakawa revealed that the company is preparing to enter the neocloud market focused on AI infrastructure and the U.S. energy storage battery market, with the Japan business expected to launch this year.

Image source: Softbank official website SoftBank telecom division president Junichi Miyakawa

SpaceX and Blue Origin race for space computing, SoftBank takes a different path

As AI computing demand surges, Elon Musk's SpaceX and Jeff Bezos' Blue Origin both plan to launch orbital data centers to address Earth's energy and space constraints.

However, the divergence in approach between Son and Musk reflects a long-standing rivalry between the two. According to Fortune magazine, the two held talks in 2017 over a Tesla investment, but negotiations broke down over equity issues.

Since then, Musk has criticized the Stargate project, which is central to Son's AI strategy, posting on X questioning SoftBank's capabilities, claiming SoftBank controls less than $10 billion in funds.

Despite the skepticism, Son remains confident in ground-based infrastructure. At SoftBank's shareholders' meeting, the 68-year-old Son outlined a grand vision, aiming to increase SoftBank's net asset value to 1 quadrillion yen (approximately $6.4 trillion) over the next 16 years by pursuing super artificial intelligence (ASI) that is 10,000 times smarter than humans.

SoftBank also showcased plans for robots used in high-risk tasks such as underwater welding and disaster rescue. Son also dismissed the idea of an AI bubble, stating he has no retirement plans.

Image source: Pixabay 2016 SoftBank white robot holding a tablet

Battle for space or ground: Industry and academia divided

Regarding the feasibility of space data centers, industry and academia are divided. Global data centers last year (2025) consumed 448 terawatt-hours of electricity, surpassing the total electricity consumption of Saudi Arabia. The United Nations estimates that this will double by 2030.

However, ground-based computing also has its limits. Rensselaer Polytechnic Institute (RPI) professor Boon Ooi pointed out that generating 1 gigawatt of power in space would require approximately 1 square kilometer of solar panels, with heavy equipment and high costs.

According to 2018 NASA data, sending materials into low Earth orbit using the Falcon 9 rocket still costs $2,720 per kilogram. Nevertheless, this grand vision remains a key selling point for SpaceX.

SpaceX completed its largest IPO in early June this year. Nicolas Owens of independent analysis firm Morningstar noted that investors are willing to pay a $72 premium over the initial stock price precisely because of its orbital data center ambitions.

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On the other hand, the tech media TechCrunch's podcast also discussed SpaceX's space computing craze. Host Anthony Ha noted that the AI industry is desperate for computing power, and executives are proposing solutions, but these people are not neutral observers; Musk's proposal could directly create internal demand for SpaceX's rocket launch business.

Guest Sean O'Kane analyzed that SpaceX's current 80% to 90% global launch share is heavily dependent on Starlink satellite replacements. If an orbital data center satellite constellation is built, satellites would need to be replaced every few years, undoubtedly securing its own launch business.

In contrast, SoftBank and OpenAI CEO Sam Altman are both cool on space data centers, because SoftBank has already heavily bet on ground-based infrastructure, and both are advocating for their own most favorable commercial futures.

Another journalist, Kirsten Korosec, also mentioned that considering SoftBank's history with massive WeWork investments, Son's role as a sober critic this time is quite intriguing.

In 2017, SoftBank invested heavily in co-working space WeWork, but as its business model faced massive losses, governance issues, and subsequent remote work trends due to the pandemic, its valuation plummeted. SoftBank poured over $10 billion in total, ultimately facing a $10 billion investment writedown, and WeWork filed for bankruptcy in the U.S. at the end of 2023, an investment Son described as a "stain on his life."

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