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SpaceShipOne is perhaps the most visible—but not the only—sign of a breakthrough for space entrepreneurs in 2004. (credit: J. Foust)

Is 2004 the breakout year for space entrepreneurship?

For years space entrepreneurs, as well as advocates and enthusiasts, have been looking for the right set of circumstances that would allow new commercial space ventures to blossom. In the late 1990s it looked like that time had come, as new satellite communications ventures like Iridium and Teledesic promised to stimulate demand for commercially-developed reusable launch vehicles (RLVs) which, with their low operating costs, promised to open other commercial markets. However, that proved to be a false dawn, as those satellite ventures went bankrupt or collapsed altogether, denying those RLV developers the necessary markets and funding. Even established space companies have been hard-hit by the weak demand for commercial satellites and launch services recently.

This past year, though, has seen glimmerings of a revival in commercial, and particularly entrepreneurial, space. A pair of seemingly unrelated events, separated by thousands of kilometers and an even wider gap in perception, have opened the doors for space entrepreneurs in the US and elsewhere. Combined, they offer new opportunities for commercial space ventures in 2005 and beyond.

The flights of SpaceShipOne achieved more than simply getting a big check and a trophy.

The first of those events took place high above Southern California’s Mojave Desert. On June 21, and again on September 29 and October 4, SpaceShipOne soared to altitudes above 100 kilometers—the arbitrary yet very real boundary of space. The last two flights allowed Mojave Aerospace Ventures, the joint venture between vehicle developer Scaled Composites and financier Paul Allen, to capture the $10-million Ansari X Prize before the prize expired at the end of the year. (See “Ka-CHING!”, The Space Review, October 7, 2004.)

The flights of SpaceShipOne achieved more than simply getting a big check and a trophy. Those flights demonstrated to the public that manned spacecraft could be successfully developed for a relatively modest amount of money—on the order of $25 million—and with the promise of making space far more accessible to the general public. The tens of thousands who traveled from around the world to witness the flights in person may have needed little convincing, but the media attention that surrounded SpaceShipOne, including an appearance on the cover of Time as the “coolest” invention of 2004, helped demonstrate to a wider audience that space is not just the realm of NASA and other government agencies.

Those flights also raised the profile of commercial suborbital spaceflight in Congress, which spent the year considering legislation designed to reduce regulatory uncertainty surrounding the nascent industry. While that bill—HR 3752, later replaced by HR 5382—won early broad support in the House, it became bogged down in the Senate over debates regarding the definition of a suborbital vehicle and safety issues. At several times during the year the bill was declared all but dead, including just after SpaceShipOne’s prize-winning final flight, when a revision of the bill—apparently inadvertently—elevated the safety of vehicle passengers to the same strict level as for the uninvolved public. (See “When good legislation goes bad”, October 11, 2004.) Fortunately for most of the industry, however, those problems were resolved, and the Senate approved the bill just hours before adjourning for the year. While SpaceShipOne and the public groundswell of interest in suborbital spaceflight may have played a significant role in the bill’s eventual passage, it’s ironic that Burt Rutan is among those who would prefer to see suborbital vehicles go through aircraft-like certification rather than receive launch licenses, as both existing regulations and the new law require. (See “Burt Rutan, in his own words”, October 25, 2004.)

SpaceShipOne’s success and the growing interest in space tourism promises to also boost the prospects of other companies developing similar suborbital vehicles.

SpaceShipOne has opened the door for further commercial efforts. Shortly before the two X Prize flights, billionaire Richard Branson announced plans to license SpaceShipOne’s technology and have Scaled Composites build up to five larger vehicles based on SpaceShipOne for his new venture, Virgin Galactic. That company promises to start carrying passengers at about $200,000 a ticket on suborbital flights as early as 2007. Several thousand people have already contacted Virgin expressing an interest in flying.

SpaceShipOne’s success and the growing interest in space tourism promises to also boost the prospects of other companies developing similar suborbital vehicles. While Scaled Composites got the first FAA license for a manned suborbital spacecraft, the company’s neighbor at Mojave Airport, XCOR Aerospace, received a similar license just a few weeks later for its own suborbital vehicle. Several other companies, including Armadillo Aerospace, Blue Origin, Rocketplane Ltd., TGV Rockets, Starchaser, and Cosmopolis 21, are continuing work on suborbital vehicles to serve space tourism and other markets.

The other event of significant import to entrepreneurial space took place at NASA Headquarters in Washington on January 14, when President George W. Bush unveiled a new exploration initiative for the space agency. This effort, called the Vision for Space Exploration, requires NASA to retire the space shuttle by the end of the decade, once the International Space Station is completed. It also features the development of a new spacecraft, the Crew Exploration Vehicle (CEV), which will allow humans to return to the Moon by 2020.

At first glance a large government program like this would seem to have far less to do with space entrepreneurs than with the existing large aerospace companies. However, NASA appears open to working with emerging space companies as it begins to flesh out the Vision. In September NASA awarded contracts worth several million dollars each to 11 companies to perform preliminary concept studies for the CEV and human lunar exploration. Many of these contracts went to major aerospace companies, including Boeing and Lockheed Martin, but others went to smaller companies, including Andrews Space and Transformational Space (t/Space), a new venture whose teammates on the contract include other entrepreneurial firms like Constellation Services Inc., Delta Velocity, and AirLaunch LLC, as well as Scaled Composites. (See “Implementing the vision”, October 25, 2004.) The agency similarly spread the wealth when it awarded several dozen technology development contracts in November.

Outside of SpaceShipOne and the Vision for Space Exploration, there have been other encouraging developments among space entrepreneurs.

NASA has also caught the prize bug. The agency this year unveiled Centennial Challenges, a prize program inspired by the Ansari X Prize and similar competitions. While the first prizes, scheduled to be unveiled in the next several months, will be modest, NASA plans to offer larger prizes, in the $10-50 million range, down the road for efforts like commercial lunar missions. The final report of the Aldridge Commission, a presidential commission charged with studying the implementation of the Vision, advocated even bigger prizes, such as $1 billion for human missions to the Moon. This resurgence of interest has led some to wonder whether there might be too many prizes at some point. (See “Beware prize fatigue”, June 28, 2004.)

Outside of SpaceShipOne and the Vision for Space Exploration, there have been other encouraging developments among space entrepreneurs. Although the launch date for SpaceX’s Falcon 1 rocket has slipped several times (originally planned for late 2003, the rocket is now scheduled to launch in early 2005), the company has found willing customers in the government and commercial sectors for both the Falcon 1 and the larger Falcon 5. One of those customers is Bigelow Aerospace, which not only plans to develop and launch a series of inflatable space modules, but also unveiled a prize of its own, America’s Space Prize, to promote the development of manned orbital spacecraft. (See “Thinking big at Bigelow Aerospace”, this issue.) SpaceDev, which won media attention for manufacturing the hybrid motor used by SpaceShipOne, is developing a suborbital vehicle of its own, Dream Chaser, and also received a contract from the Missile Defense Agency for up to six microsatellites.

The positive signs seen in 2004 are no guarantee of success down the road: government policies and priorities are always subject to change, the public’s interest in space tourism or other markets could prove fickle, and, of course, entrepreneurs have to be able to execute their business plans successfully. While people could look back to 2004 as another false start, like the late 1990s, it may be just as likely that 2004 will become seen as a true breakout year for space entrepreneurship.


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