By Akash Sriram
(Reuters) - Lonestar Data Holdings is reaching for the moon in its quest to place the first physical data center on the lunar landscape.
The space startup will use SpaceX's Falcon 9 rocket to launch a fully assembled data center late next month by integrating it with Intuitive Machines' moon lander, Athena, it said on Tuesday.
Cheaper rocket launches, abundant solar energy and cost-effective cooling systems have fueled a race among startups to transform space into a massive data hub, capable of meeting the growing computational needs of technologies including AI.
The company is pulling out all the stops to ensure the mission goes smoothly, Lonestar CEO Chris Stott told Reuters.
"This idea of using earth's largest satellite as an anchor point, it's far enough that we can have security on (communications)," Stott said, adding the focus was on disaster recovery and storage and not on latency-dependent activities.
Lonestar has signed up the State of Florida, Isle of Man government, AI firm Valkyrie and pop rock band Imagine Dragons as customers for the data center, called Freedom, which will be powered by solar energy and use naturally cooled solid-state drives.
Its operations will also have ground-based backup from data center firm Flexential's Tampa, Florida facility.
The concept of space-based data centers is gaining traction as the energy needs to maintain such operations on Earth grow sharply.
Last month, Lumen Orbit raised $11 million at a $40 million valuation. Lonestar has raised nearly $10 million with a valuation of less than $30 million, Pitchbook data shows.
However, hosting data centers in space has its own challenges, including cumbersome maintenance, limited scope for upgrades and high costs of launching rockets. There is also the risk of failed rocket launches.
"When you launch a satellite into space, it's binary. If it fails, it's dead. There's no way to recover it. There are no ways to fix it," said Chris Quilty, co-CEO of industry research firm Quilty Space.