SpaceX’s IPO marks the moment the space dream became a mainstream capital markets story. For decades, it has sold a vision of interplanetary civilization on behalf of the wider space industry. In one sense, not much has changed. That vision remains central to its identity.
What has changed is that the market is no longer treating that ambition as distant science fiction. No company raises more than $85 billion on vision alone. SpaceX has reached the public markets as something rarer: a company whose long-term mission is extraordinary, but whose near-term infrastructure is already becoming essential.
That belief is not built on hype. It is built on a refusal to accept the old aerospace consensus and the ability to execute a new vision. SpaceX put reusability at the center of launch architecture and forced the rest of the industry to rethink what a rocket company could be. Then it built Starlink, and forced the world to rethink telecommunications too.
Now, as it moves into orbital data center, it will need to rethink the orbits at which satellites fly as well.
The vast majority of the more than 10,000 satellites in space currently operate in low Earth orbit (LEO), roughly 500 to 700 kilometers above the Earth. That number is set to increase dramatically, with SpaceX applying to put up to 1 million new satellites into space.
The reality is that, if orbital data centers are to become viable, we will need to think seriously about operating satellites even lower, in very low Earth orbit, or VLEO, roughly 200 to 300 kilometers above the Earth.
That is because LEO is already becoming crowded. In addition to the satellites already in space, tens of thousands of pieces of debris are being tracked in orbit, with millions more fragments too small to track. Starlink satellites executed around 300,000 collision-avoidance maneuvers in 2025, a 50% increase from 2024. If we move from 10,000 satellites to one million in LEO, the number of maneuvers needed to avoid collisions could become extraordinary.
That is not an argument for writing off orbital data centers. The investment case is compelling, given the pressure AI is placing on the world’s electrical grids. Eric Schmidt, the former CEO of Google, has predicted that AI could account for 99% of total electricity generation, while some estimates suggest annual spending on grids will need to double to $970 billion by 2050. If SpaceX is right that orbital data centers can help solve this problem, it could end up controlling a significant share of global AI infrastructure within five to ten years.
SpaceX is also likely to hold that advantage for a long time, given no other company can yet match the scale, complexity and cost profile of its Falcon 9 and Falcon Heavy rockets.
However, there has been far less discussion about where these satellites will go, and what happens if they collide with space debris. The Kessler effect, long discussed as a theoretical risk, describes a scenario where one collision creates thousands of pieces of debris, which then cause further collisions and still more debris. In the worst case, this could create an exponential cascade that makes parts of the orbit around Earth virtually unusable.
For years, this has felt like a distant problem. But with more satellites being launched every day, governments and industry need to think seriously about how it could become a reality. They need to agree where satellites go, how long they stay there, and how to remove them once they have outlived their usefulness.
This is why SpaceX, and the wider space industry, will need to operate satellites in VLEO as well if the orbital data center vision is to become reality.
Historically, that has proved almost impossible. Atmospheric drag pulls objects at these altitudes back to Earth within weeks, making it commercially challenging to keep satellites there. But that same drag is also a safety mechanism. It means any debris is cleared from orbit within weeks too. In other words, VLEO is the first “self-cleaning” orbit we can use, and it dramatically reduces long-term collision risk.
At NewOrbit, we have developed a unique electric propulsion system that makes it possible for satellites in VLEO to operate not just for a few weeks or months, but for more than five years. That changes the commercial case for VLEO, turning what was once seen as an impractical orbit into one that can support long-duration, high-value space infrastructure.
For expensive hardware like orbital data centers, that should not only reduce repair costs over the long term, but also help reduce insurance costs.
Much like SpaceX’s own mission was once dismissed as a dream, the technology needed to make VLEO viable is advancing fast. In a world where megaconstellations are becoming the norm, VLEO flight will become essential.
This orbit does not just reduce collision risk. It can also unlock sharper imagery from smaller, cheaper spacecraft and direct-to-device connectivity that could make phone signals reliable even in remote regions.
The SpaceX IPO should therefore be seen as both a milestone and a warning. It proves that space infrastructure has entered mainstream capital markets, but it also raises the possibility that LEO could become a permanently congested operating environment. We need an alternative.
That will require regulators, agencies, investors and companies to treat orbital sustainability as a design requirement, not an afterthought. There will need to be different satellites, different orbits and new incentives to encourage lower-altitude operations.
SpaceX has shown what happens when a company moves quickly and thinks at enormous scale. But the challenge now is not just to show what can be unlocked by putting more satellites into space. It is to do so in a way that is sustainable and useful for hundreds of years to come.
Increasingly, that future will be lower than we think.
Anatolii Papulov is the CEO and co-founder of NewOrbit.
SpaceNews is committed to publishing our community’s diverse perspectives. Whether you’re an academic, executive, engineer or even just a concerned citizen of the cosmos, send your arguments and viewpoints to opinion (at) spacenews.com to be considered for publication online or in our next magazine. If you have something to submit, read some of our recent opinion articles and our submission guidelines to get a sense of what we’re looking for. The perspectives shared in these opinion articles are solely those of the authors and do not necessarily represent their employers or professional affiliations.
