Sam Altman Explores Rocket Company Investment In Potential Space Race With Elon Musk

Key takeaways

OpenAI CEO Sam Altman explored acquiring or partnering with a rocket company in a move that would place him in direct competition with Elon Musk's SpaceX, according to a Wall Street Journal report published this week.

Altman approached Washington-based Stoke Space over the summer, with discussions gaining momentum in the fall.

Among the proposals was a multibillion-dollar sequence of equity investments from OpenAI that could eventually have given the company a controlling stake in Stoke Space.

Those talks have since quieted, according to sources close to OpenAI. Stoke Space, founded by former Blue Origin engineers, is developing a fully reusable rocket called Nova, with its first launch expected in 2026.

The company aims to compete with SpaceX's Falcon 9 rocket through similar reusable technology.

Space data centers to address AI's energy demands

Altman's interest in rockets aligns with his longstanding advocacy for space-based data centers to power artificial intelligence systems.

Speaking on Theo Von's podcast earlier this year, Altman discussed the growing energy requirements of AI infrastructure.

"I do guess that a lot of the world gets covered in data centers over time," Altman said. "Like, maybe we build a big Dyson sphere around the solar system and say, 'Hey, it actually makes no sense to put these on Earth.'"

In June, Altman hinted at his aerospace ambitions during a podcast with his brother, asking, "Should I build a rocket company?"

He added, "I hope that eventually humanity is consuming way more energy than we could ever be generating on Earth."

Several tech leaders, including Musk, Jeff Bezos, and Google's Sundar Pichai, have expressed interest in orbital data centers.

Google and satellite operator Planet Labs have already signed a deal to send two prototype satellites equipped with Google AI chips into orbit by 2027.

Financial pressures and competitive challenges

The rocket discussions took place during a period of peak market enthusiasm for AI, following Altman's announcements of massive chip and data center deals with Oracle, Nvidia, and AMD in September and October.

However, OpenAI now faces scrutiny over its aggressive expansion plans.

The company has signed up for nearly $600 billion in new computing commitments despite projected revenue of only $13 billion for 2025.

This week, Altman declared a company-wide "code red" after ChatGPT began losing ground to Google's Gemini chatbot.

The emergency directive prompted OpenAI to delay other launches and ask employees to shift teams to concentrate on improving its flagship product.

These immediate challenges may have contributed to the pause in rocket company discussions.

Rivalry extends beyond artificial intelligence

The talks highlight the ongoing rivalry between Altman and Musk, who co-founded OpenAI together in 2015 before diverging over the company's direction.

Musk departed three years later and has since launched his own AI firm, xAI.

Altman has also backed projects that compete directly with Musk's ventures, including Merge Labs, a brain-computer interface startup competing with Musk's Neuralink.

OpenAI is additionally developing a social network that could rival Musk's platform X.

Altman has a historical connection to Stoke Space through his former role running Y Combinator, the startup accelerator that invested in the rocket company.

While the proposed partnership would have provided Altman with a significant entry into the space launch sector, the current status of any future discussions remains unclear.

OpenAI did not respond to requests for comment.

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