This is written by someone that is not in aerospace that thinks terrestrially.

Engineering is always a question of tradeoffs.

Launch costs are dropping, and we’re still using inefficient rockets. Space elevators & space trains, among others, can drop this much more, the launch costs are still dropping, even using rockets, maybe we’ll never get to elevators & trains the costs will drop so low!

Radiation shielding is not required for VLEO or LEO, and phenomenally more capable aerospace processors are near - hi Microchip Inc! There are many other radiation solutions coming, no doubt with nuclear power.

Satellites can be upgraded at scale, though for many things, it does not make $ sense to upgrade them, but fuel , reaction wheels, solar panels, among other things do make $ sense to replace.

Latency was technically solved in 1995 & 2001 with the first laser comms missions NASDA’s ETS-VI kiku-6 and ESA’s Artemis , and Laser crossbars for comms are common. A full laser TDRS no RF is not yet extant but soon. Earth to deepspace was just demonstrated by ESA.

Cooling can be significantly improved due to lower launch costs, heat piping, RTGs, TEGs, and thermoradiative cells, not to mention sunside solar and darkside inline radiators

Furthermore, it is very likely that as neuromorphics with superior SWaP emerge, we could see very different models of space based computation.

Economic tradeoffs should drive many of these decisions as I’m not discussing the other applications of datacenter in space