China’s lead in orbital data centres risks leaving Europe behind

Europe Faces Growing Challenge as China Accelerates Orbital Data Centre Ambitions

Poinews.com – A fresh policy analysis from the European Space Policy Institute highlights mounting concerns that Europe could fall behind in the race to develop orbital data centres. These space-based computing facilities are becoming increasingly vital for handling the enormous volumes of information produced by artificial intelligence applications and satellite networks. The report, named “Constellating Compute: China’s Domestic Policy Towards Orbital Data Centre Leadership,” cautions that a widening technological divide might force Europe to rely on external entities for processing its own space-generated information.

European Initiatives Show Promise but Lack Scale

While European nations are making progress, their efforts remain relatively modest compared to international competitors. The ASCEND research programme, supported through Horizon Europe funding since 2023, demonstrated that orbital data centres could enhance Europe’s digital independence. Meanwhile, the European Space Agency collaborated with British company Open Cosmos on the Φ-sat-2 mission, equipping the satellite with artificial intelligence tools for monitoring Earth. French newcomer ALATYR similarly revealed intentions to produce orbital data centres using robotic assembly methods.

Despite these developments, the distance between Europe and leaders like China and the United States appears to be expanding. China has elevated space-based computing to a national strategic imperative, triggering numerous government-backed programmes and policy measures designed to achieve dominance in this emerging sector.

China’s Comprehensive Approach to Space Computing

At the heart of China’s strategy sits the state-owned China Aerospace Science and Technology Corporation, which recently codified orbital data centres within an updated corporate vision. This initiative works alongside support from Beijing’s municipal administration and the Zhongguancun Science Park. The policy brief notes that China has successfully merged top-down policy creation with adaptation from both private and public enterprises, supplemented by local government incentives and assistance for independent organisations and collaborative groups.

Early implementation has been driven by prominent prototype satellite networks. The Three-Body Constellation, deployed by ADAspace during May 2025, represented the inaugural operational demonstration of computing capabilities in space. Through a partnership with Shanghai Jiao Tong University, ADAspace subsequently leveraged the constellation’s orbital processing power to operate a terrestrial robot, marking one of multiple technical experiments conducted following satellite deployment.

Competing Constellations and Major Investments

Several Chinese enterprises have since announced ambitious plans. Beijing Orbital Twilight Technology Co., Ltd., known as Orbital Chenguang, secured an unspecified equity investment together with €7.4 billion in debt financing during April 2026. Nayuta Space introduced its ALAYA supercomputing constellation, targeting the launch of 12,500 computing satellites. At the World AI Conference in July 2026, Shanghai Xingshu Tiansuan Space Technology Co. presented the Xingshu Plan, which aims to eventually encompass 1,000 satellites.

Additional players including China Mobile, Zhejiang Lab, Bailing Aerospace, Zhongke Tiansuan Technology, and Interstellar Glory Space-Based Computing Technology (iSpace) have each unveiled their own constellation proposals. Beijing’s local government has further stimulated growth by requesting orbital data centre project submissions in June 2026 in coordination with Zhongguancun Science Park. The municipality also established a space computing innovation centre employing a company-plus-alliance structure that unites competing firms such as GalaxySpace and Landspace.

According to state broadcaster CGTN, the centre’s priority areas include space-based computing chip design, high-performance computing payloads and integrated space-ground cloud computing technologies.

Strategic Planning and Future Recommendations

CASC has similarly developed a five-year roadmap for the sector, finalized in January 2026 with the Chinese Society of Astronautics under oversight from government bodies including the China National Space Administration. CGTN coverage of this roadmap indicates plans to construct gigawatt-scale space digital infrastructure integrating cloud, edge, and terminal technologies, although the original policy documents have not been officially released and Euronews was unable to independently confirm these assertions.

The ESPI brief puts forward several suggestions for European action. These include creating unified political direction, financial backing, and regulatory structures for orbital data centre advancement. The report also advocates for incorporating a flagship programme within the Horizon Europe Moonshot Projects during the 2028-2034 Multiannual Financial Framework period. Additionally, European space organisations should establish collaborative working groups with global partners to address standards and data sovereignty issues.