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Astroneurs: The Private Sector Goes to Space

The SpaceX Crew Dragon Endeavor carrying the Crew-2 mission astronauts approaches the International Space Station, April 24, 2021. (Mike Hopkins/NASA/Handout via Reuters)
We have all the ingredients for a new era: falling prices, abundant resources, and eager entrepreneurship.

Through the 1990s and into the new millennium, advocacy groups such as the National Space Society (full disclosure: I was in charge of policy and legislation at the NSS starting in 1989 and was executive vice president from 1991 to 1995) worked to advance the position of private-launch companies, encourage friendly government regulation, promote the growth of a strong private-sector presence in space, and fight the “dumping” (sales below cost that would hurt the development of American companies) of Chinese government-launch services.

The thinking was straightforward: A government-based space program would always be subject to political winds and whims. Not being self-supporting, it would always face competition from other programs that gave a more direct payoff to various political interest groups. In addition, even when funded, a government program would tend to dissipate its resources and efforts in bureaucratic payroll padding and empire building. A commercial enterprise, disciplined by shareholders and the bottom line, would have to focus more on producing results and, more crucially, on lowering costs and improving performance — something that NASA had not distinguished itself in achieving.

With a new family and related distractions, I took about a decade off from the scene. When I returned, the change was obvious. The annual International Space Development Conferences, which once had the ambience of a Star Trek convention, seemed far more professional. There were still plenty of button-bedecked enthusiasts, but there were also venture capitalists in Brioni suits and entrepreneurs who were actually bending metal and launching things, or working hard at doing so. I ran into a woman who I remembered as a student activist with Students for the Exploration and Development of Space; now she was a professor of astronautics at MIT. Another former student activist was in charge of space matters for Google.

As we’ll see later, there are many things that we can do in space, if we can just get there. But getting there is expensive. The largely unheralded revolution of the past decade has been that getting into space has become far cheaper than it used to be, and that it promises to get much cheaper still.

As the science-fiction writer Robert Heinlein famously said to his colleague Jerry Pournelle: “Once you’re in Earth orbit, you’re halfway to anywhere” in the solar system. That statement is not mere hyperbole but physical truth. The change in velocity (and hence energy required) to get from Earth to orbit is approximately the same as that needed to reach even the most distant planet in the solar system from Earth’s orbit. Thus, a change in the cost of getting to orbit is a pretty good first-order measure of how our changes in space capability are going. Here, the news over the past decade has been very good.

It used to cost almost $55,000 to get a kilogram into orbit on the Space Shuttle. To do the same thing today with the Falcon 9, the newest rocket from Elon Musk’s SpaceX enterprise, costs approximately $2,700. That’s roughly a twentyfold reduction.

Many things that are too expensive to do at $55,000 per kilogram become doable at $2,700 per kilogram. And SpaceX is not standing still. Its Starship reusable rocket, now under development, is expected to cost a mere $2 million per launch. Elon Musk says its cost per kilogram to orbit will be at least ten times lower than that of the Falcon 9. There are a lot more things that become doable at approximately $270 per kilogram. At these prices, things like space tourism and hotels, lunar mines, and asteroid mining become feasible. At a certain point, prices get low enough to draw in all sorts of new activity — much as when computing power became so affordable that suddenly it started to appear in things such as washing machines and kids’ toys. I asked a former NASA official who’s very familiar with the industry about this and got this reply: “We are just now, with reusables, starting to see possible price elasticity due to lower prices. . . . The Commercial Space Transportation Study in 1994 predicted launch prices needed to drop below $400 per pound for price elasticity to become significant. That would be about $1,550 per kilogram in today’s dollars. Almost there.”

Faster, please! SpaceX isn’t the only company lowering costs in this area; it’s just the one making the biggest, most public splash. Other companies, ranging from the relatively tiny RocketLab to Jeff Bezos’s secretive Blue Origin, are doing the same.

They’re lowering costs because doing so is essential to their business. Additionally, since they are commercial rather than political enterprises, they can afford to fail. When a SpaceX test rocket explodes on the stand, that’s not a political scandal or a tragedy, but a learning event for engineers to study in order to find out what went wrong and how to stop it from happening again. Instead of congressional hearings, the problem fix is examined at the next test launch. There are no rewards for boosting payrolls, adding levels of management, or opening a facility in a key congressional district. Customers want cheap, reliable launches, and the only way to survive is to give them what they want. The only way to flourish is to give those customers more of what they want than the competition can.

We’re already seeing some of the benefits. SpaceX is launching its Starlink broadband, low-latency satellite network, in which thousands of relatively small, advanced satellites (each weighing approximately 260 kg) will orbit the earth simultaneously, allowing people to access the Internet from anywhere. It’s doubtful that this could have been profitable at costs of more than $50,000 per kilogram. It’s likely that it can be at one-twentieth of the cost.

The space resource used by communications satellites is locational. By virtue of being located overhead, they can see and communicate with large swathes of territory at a time. (“Spy” satellites — more politely referred to as “remote-sensing” satellites — also take advantage of this locational resource, and while they were once the sole domain of superpower intelligence agencies, lower costs have made their commercial use so common it’s no longer even newsworthy.) But there are other resources available, too.

This article is adapted from the author’s book America’s New Destiny in Space.

Glenn Harlan Reynolds is the Beauchamp Brogan Distinguished Professor of Law at the University of Tennessee, where he teaches space law.  He is the author of numerous works on space law and space policy, and has served on the Vice President’s Space Policy Advisory Board and on NASA’s Planetary Protection subcommittee.

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