On Feb 2, 2026, Elon Musk merged SpaceX with xAI in a $1.25 trillion deal. The idea is simple but massive: build solar-powered AI data centres in orbit, where energy is constant and cheaper. SpaceX has even filed to launch up to 1 million satellites to power this vision.
Starlink is funding it all. It generated an estimated $10.4 billion of SpaceX’s $15 billion revenue in 2025, with strong profitability. With nearly 10,000 satellites already in Low Earth Orbit and 2,000 more added each year, SpaceX dominates LEO today.
China is not sitting still.
• China has filed plans at the ITU to reserve 203,000 satellite slots by the mid 2030s. Many may never launch, but reserving slots forces rivals to design around them.
• State contractor CASC plans to build gigawatt-scale AI data centres in space by 2030 under a “Space Cloud” program.
• Chinese military researchers are openly calling for dual-use satellite systems that merge commercial and defence capabilities.
• Commercial spaceflight is now a national priority under China’s upcoming Five Year Plan.
The reality? China is still behind, mainly because it has not yet mastered reusable rockets like Falcon 9. Reusability is what made Starlink’s scale possible.
But Beijing is playing long term. It is reserving orbital slots, building institutions, training talent, and aligning military and commercial strategy.
This is no longer just a space race. It is a race to control AI compute, global communications, and future military infrastructure in orbit.
Low Earth Orbit has limited capacity. If it fills up, whoever got there first keeps the advantage.
For now, that leader is Musk. The question is how long that lasts.
Click to read the full article: How China Is Quietly Building a Rival to Elon Musk's SpaceX