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Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

reuters.com

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Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#101

Post by bakies »

jacobgold wrote: post #73
doctoboggan wrote: post #70

Earlier quoted context omitted.

> Is there anyone credible who thinks this is a plausible pathway for SpaceX to make huge amounts of profit? Scott Manly (who I think is credible) has a video where he goes over the logistics of SpaceX's space based data centers. He seems to think its an idea worth pursuing, but its important to note that his expertise is space tech, and not business strategy.

Yeah, I have no doubt that it's possible to put GPU servers in space. The Starlink satellites are servers in space. The question is whether it's even remotely profitable to do this for AI training/inference servers.

The same way that xAI has compute on the ground and there's such demand that the compute exists so it will be sold. I think SpaceX can conceivably sell the space compute easily. This goes with the business strategy of Elon which is just sell services to himself. He sells rocket launches to himself with the excuse of creating a space datacenter. The same way he sells cybertrucks to spacex because the public won't buy them. I'm pretty confident it's definitely cheaper to put the compute in Texas, but might be viable enough to sell himself rocket launches and make his company worth more to leverage for more ventures. I'm not a business person I don't really get how it's all so valuable if the only demand is itself.

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#102

Post by nijave »

tqi wrote: post #88
chris_money202 wrote: post #57

Earlier quoted context omitted.

Repairability and depreciation are the main problems. A earth data center can be repaired, depreciated, and recycled at EoL recovering some of the costs. SpaceX datacenters are a total write off from the moment they are launched.

Isn't the problem also that because of radiation, processors in space either need to have larger feature sizes OR additional shielding / redundancy? Seems like a pretty high price to pay for slightly cheaper energy...

Ars had an article that cited some HPE testing on the international space station that said regular hardware is _probably_ fine up to about 5 years

Definitely not definitive but it's plausible current hardware could survive with minimal modification

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#103

Post by nijave »

jacobgold wrote: post #73
doctoboggan wrote: post #70

Earlier quoted context omitted.

> Is there anyone credible who thinks this is a plausible pathway for SpaceX to make huge amounts of profit? Scott Manly (who I think is credible) has a video where he goes over the logistics of SpaceX's space based data centers. He seems to think its an idea worth pursuing, but its important to note that his expertise is space tech, and not business strategy.

Yeah, I have no doubt that it's possible to put GPU servers in space. The Starlink satellites are servers in space. The question is whether it's even remotely profitable to do this for AI training/inference servers.

Training, no. Latency is too high.

Inference the latency becomes trivial.

Other things, I suspect latency is too high again.

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#104

Post by abfan1127 »

WalterBright wrote: post #96
jacobgold wrote: post #50

I completely understood the idea of Starlink and expected that it would be successful and useful, which it is. I've worked in data centers for decades now, and I am incredibly skeptical of the "data centers in space" sales pitch. It seems like an actual scam. Data centers submerged in the ocean or placed in the desert seem much more promising. But I have only an enthusiast's understanding of rockets and physics, so I…

> Data centers submerged in the ocean Sooner or later it's going to leak.

I think corrosion is the big issue here. perhaps that is where the leak comes from.

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#105

Post by asadotzler »

jacobgold wrote: post #65
chris_money202 wrote: post #57

Earlier quoted context omitted.

Repairability and depreciation are the main problems. A earth data center can be repaired, depreciated, and recycled at EoL recovering some of the costs. SpaceX datacenters are a total write off from the moment they are launched.

That's actually not a concern I'd have, because hardware that has been sufficiently tested and burned in tends not to fail for a very long time. I've done builds that ran for 5+ years with virtually no physical attention, just continual degradation as hardware is taken out of service. There's also not much money to recover from 5+ year-old hardware. I used to run AI inference GPU servers in road vehicles, which is pr…

5 years is a Starlink's typical lifetime. Data center satellite lifetimes will probably be shorter. Demise sooner, replace more often. GPUs get more energy efficient every year and leaving the slower, hungrier chips up there much longer than 3 years seems wasteful given the cheap cost of launch.

I think this could be done at an interesting scale even on Falcon 9 alone. If Starship does even 20% of its early design goals, it'll beat Falcon 9 and we could see orbital servers being demised and replaced every 3 years, maybe even 2, for ones with abnormally high failure rates.

Now, whether or not this will all make money in the end has a lot to do with what's going on down here on terra firma and how long it takes to get useful capacity into orbit.

(It's taken 7 years to get Starlink capacity enough for serving 10M customers. Verizon FiOS did 10M in 5 years. AT&T Fiber took 4-5 years to deploy to 10M. So, space isn't a lot slower than terrestrial.)

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#106

Post by metalliqaz »

tmp10423288442 wrote: post #95
jacobgold wrote: post #50

I completely understood the idea of Starlink and expected that it would be successful and useful, which it is. I've worked in data centers for decades now, and I am incredibly skeptical of the "data centers in space" sales pitch. It seems like an actual scam. Data centers submerged in the ocean or placed in the desert seem much more promising. But I have only an enthusiast's understanding of rockets and physics, so I…

The ocean is worse than space from every perspective but cooling, radiation shielding, and cost/ease of installation. But that just highlights how bad of an idea space-based data centers are at this time.

> from every perspective but cooling, radiation shielding, and cost/ease of installation.

Oh is that all? Those are major data center concerns.

Don't forget the biggest one: an ocean-based system could be pulled up and serviced without the need for a human-rated rocket. Oh, and bandwidth/latency.

The ONLY benefit of space is that it doesn't require siting a major construction in a town full of angry residents, and it has abundant solar power. But given how much it costs to get the solar panels in orbit, that power sure ain't free.

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#107

Post by RIMR »

LorenDB wrote: post #79
RIMR wrote: post #71

Earlier quoted context omitted.

Let's just put it this way: The ISS produces about 120 kilowatts of electricity. An Nvidia Blackwell B200 GPU uses 1.2 kilowatts of electricity. So, you would need a similar array of solar panels and radiators just to power 100 of them. You probably would need 2-3 launches for a satellite this big, and realistically, you would just make smaller satellites. That's $4,000,000 worth of GPUs, A couple millon or more of R…

SpaceX would be launching these on Starship, which has a much lower targeted launch cost.

For reasons already outlined, I have doubts about their math. Targeting $250/kg payload costs is ambitious for a rocket that has not yet successfully reached orbit or proven cost-effective.

Even if we do somehow succeed at affordably dumping tons of GPUs into orbit, what do we do about the Kessler Syndrome?

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#108

Post by nijave »

zugi wrote: post #76

SpaceX has accomplished spectacular things in reusable launch vehicles and space-based networking. It will soon restore the heavy launch capability that the US lost when it retired the Saturn V in the 1970s, but in an affordable and sustainable manner. SpaceX is almost single-handedly keeping the US ahead in space. I'm bullish on SpaceX as a company in terms of technical accomplishment. Buying SPCX would make sense a…

>but in an affordable and sustainable manner

Affordable is a bit questionable. It's heavily subsidized by Starlink and government.

Not completely clear what happens to price if SpaceX doesn't keep launch demand propped up with their own business.

Re: Short sellers notch $8.7B profit as SpaceX shares dip to IPO price

#110

Post by nijave »

amanaplanacanal wrote: post #90
zugi wrote: post #76

SpaceX has accomplished spectacular things in reusable launch vehicles and space-based networking. It will soon restore the heavy launch capability that the US lost when it retired the Saturn V in the 1970s, but in an affordable and sustainable manner. SpaceX is almost single-handedly keeping the US ahead in space. I'm bullish on SpaceX as a company in terms of technical accomplishment. Buying SPCX would make sense a…

Yes but... All the "value" in SpaceX is in AI. Actual space launches are a tiny part of the portfolio. Talking about launch capability is almost off topic when taking about SpaceX valuation.

When I checked, Starlink seemed somewhat valuable but highly questionable addressable market (limited growth)
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