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What's the consensus on this? I feel like the packaging and heat dissipation issues need some work. Its much harder to fly electronics on a big noisy rocket than most people think
It's a bold claim, a few years distant, by Elon Musk. Just on that alone you can pretty much assume "definitely bullshit".
The only thing that is "better" in space is the efficiency of solar energy. Everything else is harder and more expensive

* Rockets costs more than trucks for moving things around * No water in space for cooling/heat transfer * Heat dissipation is difficult because vacuum is the best insulator * How do you repair one? * network bandwidth is probably lower

Musk was confident we'd have people on Mars by the end of 2026, so maybe he's assuming we'll put the data centers there?
Ah, the old "[absurd thing] will happen with AI in [time period just long enough that everyone has kinda forgotten about the prediction when the deadline passes]" gambit.

(A bunch of AI boosters were predicting AGI by 2025 a few years back, for instance.)