What is the Orbital Cloud?
The Orbital Cloud represents the fundamental transition from single-use aerospace hardware to multi-tenant orbital infrastructure. It is the delivery of power, compute, and communications as on-orbit services, enabled by modular, serviceable spacecraft, orbital logistics, and a multi-tenant control plane that handles scheduling, isolation, metering, and billing. This is not incremental improvement—it is a category shift that decouples the payload from the platform, moving the space economy from CapEx hardware sales to OpEx capacity services.
Key Takeaway
The Orbital Cloud abstracts the physical complexity of space operations into three core services: Compute (processing capacity), Transport (networking and downlink), and Utility (power, thermal, and hosting). Customers provision capacity through an API; the platform handles the physics.
The Historical Context: Space 1.0, 2.0, and 3.0
To understand the Orbital Cloud, we must first trace the evolution of the space economy through three distinct phases.
Space 1.0: The Government Era (1957-2000) was defined by monolithic, mission-specific satellites built by prime contractors. Each satellite was a custom engineering project, optimized for launch survival and single-use operation. The unit of trade was the satellite itself—a $500 million asset with a fixed lifespan, launched once and never serviced.
Space 2.0: The Commercial Era (2000-2020) saw the rise of commercial satellite operators and the emergence of ride-share launches. Companies like Planet and Spire demonstrated that smaller, cheaper satellites could deliver value. However, the fundamental model remained unchanged: build, launch, operate until failure, de-orbit. The economics were still CapEx-heavy, with customers buying hardware rather than services.
Space 3.0: The Cloud Era (2020-present) is defined by the Orbital Cloud. This phase is characterized by three converging vectors: modular assembly (standard interfaces like iSSI and RAFTI), robotic servicing (refueling and repair), and edge AI demand (processing data in orbit to reduce downlink costs). The unit of trade shifts from the satellite to capacity—Compute, Transport, and Utility—provisioned on-demand through a software control plane.
The Three Pillars of Capacity
The Orbital Cloud delivers three core services, each abstracting a layer of physical complexity into a digital SLA.
Compute
The processing layer. Renting GPU/CPU cycles in orbit to reduce latency and filter data before downlink. Edge AI inference runs milliseconds after sensor collection, eliminating the round-trip delay to Earth. Metric: PetaFLOPS. Status: Scaling Edge AI.
Transport
The networking layer. Moving data between nodes via inter-satellite links (OISL) and to the ground via downlink. Laser crosslinks enable low-latency mesh networks. Metric: Gbps Capacity. Status: Laser Mesh Active.
Utility
The physical facility layer: Power, Thermal, and Hosting. Renting the "real estate" (slots) and the "utilities" (power/thermal capacity). Metric: Power & Hosting. Status: 20kW+ Nodes.
The Economic Multiplier: From CapEx to OpEx
The Orbital Cloud's economic transformation is driven by the "Multiplier Effect": modular assembly and robotic servicing triple the lifetime value (LTV) of every asset launched.
In the legacy model, a satellite is launched, operated for 5-7 years, and then de-orbited. The asset is written off as CapEx, and replacement requires a new $50 million build. The Orbital Cloud changes this equation: standard interfaces (iSSI for refueling, RAFTI for docking) enable robotic servicing. A node can be refueled, repaired, and upgraded in orbit, extending its operational life to 15-20 years.
This shift from CapEx to OpEx is the same transformation that cloud computing brought to IT infrastructure. Instead of buying servers, companies rent compute capacity. Instead of building satellites, companies rent orbital capacity. The infrastructure provider amortizes the asset over decades, while customers pay monthly for what they use.
The Multiplier Effect
Refueling + Assembly = Infinite LTV. A $50M node that operates for 20 years instead of 7 years generates 3x the revenue. The infrastructure provider captures this value through recurring OpEx revenue, while customers eliminate the upfront CapEx barrier to entry.
The Vendor Landscape: Vertical vs. Modular
The Orbital Cloud market is defined by an architectural split: vertical integrators versus modular platforms. Vertical integrators (Rocket Lab, Lockheed Martin) build end-to-end systems optimized for their specific payloads. They control the entire stack but cannot scale beyond their own use cases.
Modular platforms separate the bus from the payload. They provide standard interfaces, multi-tenant hosting, and a control plane that orchestrates capacity across multiple customers. This architecture enables the "AWS for Orbit" model: the platform provider owns the infrastructure, customers bring their code.
"The Walled Garden model works until it doesn't. When AI workloads require 20kW of power, a 3kW bus cannot compete. Modular platforms that can scale power and compute independently will dominate the high-margin services market."
View the full Vendor Landscape →
Why the Future of AI is in Orbit
The Orbital Cloud is not just about space infrastructure—it is about the future of artificial intelligence. The bottleneck for AI is not compute (we have GPUs), but data transport. Downlinking raw sensor data from orbit to Earth is expensive, slow, and bandwidth-constrained.
Edge AI in orbit solves this by processing data at the source. A satellite with a GPU can run inference models milliseconds after collecting sensor data, filtering out 99% of the noise before downlink. This reduces downlink costs by orders of magnitude and enables real-time decision-making for applications like maritime security, supply chain auditing, and disaster response.
The Orbital Cloud creates the conditions for "Orbital-Native" applications—software that can only exist because of zero-latency, global-view infrastructure. Just as the iPhone enabled Uber and Instagram, the Orbital Cloud will enable a new class of software vendors that don't own satellites but consume orbital capacity. The infrastructure is ready. The code is yet to be written.
A Note on Taxonomy: Orbital Cloud vs. Space Cloud
It is critical for investors to distinguish this asset class from the legacy "Space Cloud." While the terms are often used interchangeably in general media, they represent distinct layers of the capital stack.
The "Space Cloud" (as defined by AWS and Microsoft) primarily refers to the connectivity layer—virtualized ground stations and 5G backhaul designed to move data back to Earth. In contrast, the "Orbital Cloud" is the compute layer—physical data centers operating in the vacuum of space to process data at the source. Understanding this divergence is key to valuing the underlying infrastructure.
For a detailed analysis of the Space Cloud, see our market definition page.
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