The AI arms race is heading towards the "starry sea"! From competing for chips to controlling critical data, underwater cables and satellites may take over in the next wave of computing power frenzy.

Recently, positive signals from the AI computing power industry chain, including NVIDIA Corporation's explosive earnings outlook and South Korea's extraordinarily strong triple-digit growth in semiconductor exports, have fundamentally validated the logic of an AI computing power bull marketindicating that global demand for AI computing power is still accelerating rather than reaching a peak. According to the analyst team at Deutsche Bank Aktiengesellschaft, the increasingly robust global demand for AI computing power is rapidly extending from GPUs, HBM, and servers to network switch chips, optical modules, submarine fibers, and low Earth orbit satellites. NVIDIA Corporation reported that its revenue for the second quarter of fiscal year 2027 reached $96.2 billion, a year-on-year increase of 106%; among this, data center revenue was $89 billion, also showing a year-on-year increase of 117%. The revenue guidance for the third quarter has further risen to $108 billion, with a fluctuation range of 2%. This suggests that industry bottlenecks are shifting from merely GPU supply to the rapid interconnection and cross-regional data transmission, as well as the collaboration of power and data center clusters: without sufficient network throughput and transmission resilience, even more accelerators may become compute islands that cannot collaborate efficiently. The strong demand for AI computing clusters is already reflected in longer-term and larger-scale infrastructure contracts. Reports indicate that Anthropic has signed a $35 billion cloud computing agreement involving approximately 350 megawatts of capacity with Lambda, supported by NVIDIA Corporation; shortly prior to this, Anthropic committed to paying Nscale $45 billion over the next six years to rent about 460 megawatts of AI computing power utilizing NVIDIA Corporation's Vera Rubin chips. The total of these two deals, approximately $80 billion, illustrates that leading model companies are transitioning from on-demand cloud service buyers to long-term infrastructure tenants locking in chips, power equipment, data center operations, and network capacity in advance. Deutsche Bank Aktiengesellschaft notes that competition for AI computing infrastructure has upgraded from who has the most core computing chips to who controls the physical channels, network infrastructure architecture, and key data nodes for global data flow; thus, submarine cables and large satellite platforms have simultaneously become scarce assets in the AI era, tools of digital sovereignty, and even the forefront of political games among GEO Group Inc. The culmination of AI goes beyond computing clusters and power infrastructure; it includes undersea cables and satellites. Deutsche Bank warns that the digital choke point namely, submarine cables and satellite resources is becoming a critical computing asset in the AI reasoning era, with 1.8 million kilometers of submarine cables and low-orbit satellites opening a second main line of AI infrastructure. The analyst team at Deutsche Bank Aktiengesellschaft states that in the age of "infrastructure realism," digital connectivity infrastructure has shifted to become a major battleground for great power competition. This means that what was once considered a neutral public utility is now seen as a strategic lifeline, with the AI computing arms race entering the "infrastructure realism" era. In a report released on Wednesday, the team led by analyst Marion Raab wrote that submarine fiber optic cables and low Earth orbit satellite constellationspreviously regarded as neutral public utilities supporting global communicationsare now seen as GEO Group Inc political strategy assets that can provide strategic leverage and resilience while also bringing vulnerabilities. The arms race dominating these digital networks has become a decisive GEO Group Inc political frontier, with sovereign nations and private hyperscale cloud service providers competing for control over the physical systems that underpin the super revolution in artificial intelligence. Submarine cables are indispensable for the global economy, carrying over 99% of intercontinental data traffic through fiber optic channels laid across 1.8 million kilometers of seabed. It is estimated that financial transactions valued at $100 trillion are transmitted through these underwater networks each day, including data from the Global Banking Financial Telecommunication network that connects over 8,300 financial institutions across 195 countries. The 1.8 million kilometers of submarine Optical Cable Corporation contains vulnerabilities, as hyperscale cloud resource vendors strive to reshape the data landscape. Despite this, this critical infrastructure remains exceptionally fragile. Raab's analyst team at Deutsche Bank points out that a recent study found that a typical cable outage can immediately cause a 2 percentage point drop in GDP growth for the affected economy. Within three to six years, the gap between disrupted countries and their undisturbed neighbors could widen further, with the former's GDP growth rate lagging by 9 percentage points due to significant deterioration in economic efficiency, innovation capability, and labor productivity. Maintenance issues further amplify these risksthere are only about 40 significant specialized cable repair ships worldwide, with repair costs for each incident ranging from $500,000 to $1 million. The geographical concentration exacerbates the danger, as critical routes traverse multiple GEO Group Inc political hotspots, including the Red Sea corridor, which carries 17% to 25% of global internet traffic. Driven by enormous bandwidth demands generated by AI, American tech giants have fundamentally reshaped the ownership structure of global connectivity infrastructure. The largest content providers on the internet and cloud computing networks now account for nearly three-quarters of total international bandwidth demand, a significant increase from less than half in 2016. Of the estimated $14 billion investment required for new submarine cables expected to be operating between 2025 and 2027, large content providers and cloud computing giants such as Alphabet Inc. Class C (GOOGL.US), Meta (META.US), and Amazon.com, Inc. (AMZN.US) are leading the funding and technical designs, rather than traditional telecommunications operators. This vertical integration enables hyperscale cloud service providers to build private data channels connecting their large data centers while reducing reliance on traditional telecommunications providers. The European Development Policy Management Centre warns that the increasingly concentrated control of U.S. hyperscale cloud service providers is creating structural dependencies, potentially undermining Europe's digital sovereignty. The battlefield of the global arms race has shifted from the seabed to low Earth orbit, where connectivity rights have become a new strategic high ground in the AI era. At the same time, space has emerged as the latest battleground for dominance in connectivity. Deutsche Bank Aktiengesellschaft states that Elon Musk's SpaceX (SPCX.US)-dominated Starlink high-speed satellite internet empire currently accounts for 54% of all operational satellites in orbit, with over 10,800 satellites deployed and plans to eventually deploy 42,000. China's response has taken the form of two parallel strategic deployment plans: a state-led national grid constellation and the Shanghai-supported Qianfan constellation, which together plan to deploy a large number of satellites between 13,000 and 15,000. This research report from Deutsche Bank Aktiengesellschaft notes: In the era of infrastructure realism, the power of development and growth does not primarily depend on how many cables or satellites are constructed, but rather on the ability to control the most connected nodes and structures of large network systemsextending from the seabed to low Earth orbit. SpaceX is seen as one of the most direct, vertically integrated core winners on the satellite communication side of Deutsche Bank's "digital infrastructure choke point" investment framework. The Deutsche Bank report highlights that the real determinant of power is not the absolute number of cables or satellites, but the control of network nodes, transmission architectures, and access rules. SpaceX simultaneously possesses reusable rockets, satellite manufacturing, launch capacity, Starlink networks, ground terminals, and network operations; Starlink has captured 54% of the world's operational satellites, allowing the company to earn not just satellite hardware revenue but also long-term "infrastructure rent" from global connectivity networks. Its strategic value is particularly highlighted in scenarios of submarine Optical Cable Corporation disruptions, wars, natural disasters, and coverage in remote areas: Starlink can form a redundant communication layer outside traditional fiber networks, providing high-value connectivity services to governments, the military, businesses, and mobile operators. With the surge in cross-data center traffic driven by AI training and reasoning, SpaceX can also integrate Starlink, ground AI clouds, and future orbital computing centers into a launchconnectcompute closed loop. However, submarine fiber remains dominant in terms of capacity, unit bit cost, and stability, while low-orbit satellites primarily serve as supplementary, backup, and special scenario connections; various countries' concerns over digital sovereignty, spectrum control, and strategic dependencies may also limit Starlink's global expansion. Regarding target prices, Deutsche Bank Aktiengesellschaft gave SpaceX a "Buy" rating and a target price of $255 when it first covered the company on July 7, 2026; following the second-quarter earnings report, on August 5, it maintained the "Buy" rating but slightly lowered the target price from $255 to $235 due to the potential for significant increases in computing capacity and capital expenditures in 2027. Based on a stock price of approximately $140.71 on September 3, the $235 target price corresponds to a potential upside of up to 65% for SpaceX. Wall Street investment firms such as Goldman Sachs Group, Inc. and Morgan Stanley concentrate their bullish logic on SpaceX onreusable rockets and Starship continually reducing launch costs; Starlink establishing scaled recurring revenue in consumer, enterprise, and government markets; AI infrastructure and computing rentals becoming a faster-growing new engine; vertical integration of ground and orbital AI computing enabling SpaceX to deliver connectivity and computing at lower costs. Deutsche Bank believes that the companys second-quarter growth significantly outperformed expectations, mainly driven by AI infrastructure and the Starlink enterprise and government business, shortening the path to reach a $100 billion annualized revenue run rate; thus, the target price downgrade does not represent a reversal in bullish logic, but rather a risk valuation for adding at least 3 GW of computing capacity, substantial capital expenditures, financing needs, and free cash flow pressures. Musk previously posted on social media platform X, predicting that SpaceX's annual revenue will reach approximately $3.5 trillion around 2033, a more aggressive stance than his earlier claim of reaching $1 trillion by 2030; based on Wall Street's forecast of $100 billion revenue in 2027, this translates to a 35-fold growth over six years, with a compound annual growth rate of about 81%. However, this aggressive forecast is Musk's personal projection and not an official company guidance. SpaceX's prospectus explicitly defines "building a continuously expanding space civilization, ultimately progressing toward a Type II civilization capable of utilizing the entire energy of the sun" as a long-term paradigm shift; Musk himself has stated that lunar satellite factories, mass drivers, and annual deployments of more than 100 terawatts of AI hardware will propel humanity toward "non-trivial progress" toward a Type II civilization. Therefore, orbital AI data centers are not isolated projects but are the first layer of infrastructure connecting "Earth's limited computingsolar system-level energymulti-planetary civilization." The so-called Kardashev Type II Civilization refers to a civilization that can utilize all the energy of its star, while Type III would manipulate the energy of the entire galaxy, far exceeding SpaceX's current narrative.