The continuing rise of artificial intelligence will soon see the deployment of data centres into outer space, where they can be powered by endless solar energy without further contributing to Earth’s global warming.
Scottish businessman Will Whitehorn, a former president of Virgin Galactic, said this will be the next stage in the “industrial revolution” taking place across the commercial space sector.
It will be the focus of next week’s Space-Comm Expo in Glasgow. An estimated 3,000 delegates from around the world will gather at the SEC events campus where Mr Whitehorn will play host as executive chair of the event.
“Satellites are incredibly useful, but the next part of this industrial revolution is going to be putting technology in space that currently uses a lot of energy on the planet,” he said. “The first one of those technologies to go into space will be data centres.
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“Because of the AI revolution data centres are increasing – even now the amount of energy they use is a bigger contributor to the carbon output of the world than aviation, for example. That’s one of the industries that can easily go into space.”
It is hoped that Scotland’s “end-to-end” capability – spanning rocket construction and launch pads to satellite manufacturing and downstream data applications – will allow the country to capture a meaningful slice of a global market that the World Economic Forum has estimated will grow to £1.4 trillion by 2035, up from £490 billion last year. Space-related enterprise currently generates more than £250 million in annual revenues in Scotland, with about 8,500 people employed in upstream and downstream activities.
Securing a piece of that market has the potential to transform Scotland’s economy, Mr Whitehorn said.
“I do think that is possible because this industry is very new, and it relies on intellectual capability,” he explained. “One of the things the UK excels in is science academia, and this is one of the areas where science academia is working hand in hand with new-style small companies, and that can achieve quite a lot more than the kind of investment needed for industrial production that Scotland was pursuing in the 1990s.”
Referring to Elon Musk’s SpaceX programme in the US, Mr Whitehorn added: “You don’t need to be the world leader in rocket launch. Our rocket launch can be the specialist stuff going from Shetland where we have the unique position to enter satellites into polar orbit, as it’s called.
“The UK has not got the largest space industry in the world. We know where that is – the largest space industry in the world is in the United States, and the largest government expenditure is in the United States. But this country punches well above its weight and Scotland punches very well above its weight, and Scottish academia is very involved in the development of exploration around the world.”
Five of the UK’s seven declared spaceports are in Scotland and, of these, four are in the Highlands and Islands. The most advanced is SaxaVord in Shetland, which is currently Western Europe’s only fullylicensed vertical rocket launch facility and is aiming for its inaugural lift-off by the end of this year.
Launch services company Orbex makes its Prime rockets at its headquarters in Moray and is also in charge of the Sutherland Spaceport on the A’ Mhoine peninsula on the north coast of Scotland. Another manufacturer, Skyrora, makes its three-stage XL rockets at its factory in Cumbernauld.
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Meanwhile, Glasgow designs and builds more small satellites than anywhere outside of California thanks in large part to the activities of Clyde Space, which has been owned by Sweden’s AAC Microtec since 2018.
Scotland is also home to an array of downstream companies that use the data collected from space for a variety of purposes, while the country’s academics are helping in the development of technology for deep space missions.
These and other Scottish achievements will be one of the major themes at Space-Comm, Mr Whitehorn said, along with a focus on the new technologies that are being applied in the commercial sector.
“Space is undergoing an industrial revolution and the thing about industrial revolutions is that nobody notices them until they are quite a long way under way,” he said. “Nobody noticed the steamships when they first started going up and down the Clyde in the 1820s. By the 1850s, they had transformed shipping.
“The space industrial revolution hasn’t really been picked up yet by the general public but it’s beginning to be picked up by governments. The amount of government money going into space outside of America is rocketing at the moment.”
Mr Whitehorn has previously served as chairman of Clyde Space and currently holds that same position at Seraphim Space Investment Trust, which launched in July 2021 and is currently valued at about £116m on the London Stock Exchange. Its portfolio spans 32 businesses that are predominantly privately-financed, almost half of which are in the UK.
He said it is more difficult to raise money for a space company in Europe than in North America, but the investment environment is improving as countries such as the UK, France, Germany and Italy have increased their government space budgets.
The market has also been invigorated by a number of private equity deals coming out of the US, such as the 2023 acquisition of Germany’s OHB by venture capital group KKR.
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“I think the environment for investing in companies in Scotland, for example, is improving,” Mr Whitehorn added.
In June of this year, the Scottish Space Network announced a collaboration with New York advisory firm Sustainable Alpha to secure opportunities for the global investment community to back early-stage space technology companies in this country and further afield.
Mr Whitehorn said this type of “global approach” is necessary for Scotland to become a key hub in the international sector.
“The one thing the UK and Scotland cannot do is dominate this industry,” he said. “We just don’t have the scale and scope, but we could become the incredibly important niche player.”
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