It’s no secret that a number of the members of the annual Forbes Billionaires list are aiming for the stars. Just Google “billionaire space race” and you will find a wealth of articles touching on the billionaires dreaming big.
Elon Musk is the most famous in the race, having founded SpaceX, which to date has seen over two dozen successful missions. But there are three other big billionaire players. Amazon CEO Jeff Bezos is the founder of Blue Origin, which is already launching and landing rockets as it prepares for its first customers. Virgin CEO Richard Branson is the founder of Virgin Galactic, whose SpaceShipTwo spacecraft for passengers is currently in the test phase. Virgin Galactic recently spun off a new company, Virgin Orbit, which is developing the LauncherOne spacecraft for satellites. Microsoft cofounder Paul Allen has founded Vulcan Aerospace, whose first spacecraft is in development but nearing completion for testing.
But a slew of newfound tech millionaires and billionaires making their way into space is a much older story. Look back to the late 1990s, and you’ll find a slew of space companies that tried and failed to get off the ground. So what’s different today? There’s a market.
But that market isn’t for legions of space tourists, as many starry-eyed tycoons of the 90s tech boom thought. It’s for something much more practical – small satellites. Small satellites are in some ways a spinoff of the smartphone – they take advantage of the revolution in miniaturizing computer components, and can quickly iterate over time. And while they may not have the capabilities of larger, multi-billion dollar satellites, they do have a major advantage: cost. The demand for data – any data – that small satellite providers can provide is enormous, even if they can’t provide it in the resolution and detail of bigger satellites. And that demand only grows as the price goes down.
To be sure, all of the four companies mentioned above are pushing towards human spaceflight – SpaceX has a contract with NASA to deliver astronauts to the space station and Virgin Galactic has already sold tickets for suborbital journeys. But their business plans are anchored in the enormous backlog of satellites anxiously awaiting their chance to get into space. There’s much more demand out there for launches than traditional providers are able to meet. And that creates an opening for billionaires to realize their childhood dreams of space travel.
“One factor that’s important for all of these companies is the continued development of the small satellite market,” says Bill Ostrove, an aerospace analyst. “If companies like Planet and OneWeb are able to be successful, there will be opportunities for many new launch providers.”
The two companies that have made it to space successfully so far are Musk’s SpaceX and Bezos’ Blue Origin. Both of these companies are developing traditional rockets with crewed capsules intended to deliver astronauts and cargo to orbit and beyond. But their respective approaches to development have been vastly different. There may have been no better demonstration of this than at last year’s Code conference, where both Musk and Bezos talked space. Bezos’ mantra was all about the long-term planning to build commercial infrastructure in low Earth orbit for the next generation. Musk, on the other hand, talked about his plans to send humans to Mars next decade.
The two companies reflect their respective founders.
“Under SpaceX’s model, the company gets its products to the market as quickly as possible, then rolls out changes and upgrades over time,” explains Ostrove. “This has benefitted the company by giving it a steady stream of revenue by launching satellites and working with NASA. However, we’ve also witnessed some major failures by the company, and there are also questions about its fueling methods and components.”
“Blue Origin, on the other hand, is doing much of its R&D before entering the market,” Ostrove continued. “Early test launches of its New Shepard were pretty secretive as well. The company has tested many of its engineering designs and operational models with the New Shepard. That will enable it to be a much more experienced company once it starts operating that launch vehicle, as well as the larger New Glenn. While the company may not have the same ‘growing pains’ that SpaceX did when it entered the market, Blue Origin has also missed out on revenue and ‘first mover advantage’.”
Virgin and Vulcan share similarities with one another, as well. They’re both developing spacecraft that are delivered into the air by an aircraft and launch their rockets at high-altitude, giving them more flexibility because they can launch from an airport rather than a specialized launch pad. Their histories are intertwined, too. Virgin’s SpaceShipTwo is being developed by Scaled Composites. Scaled developed SpaceShipOne, the first privately owned spacecraft to make it to space in 2004, as part of a joint venture with… Paul Allen.
Both Virgin and Vulcan are off to slower starts than was originally anticipated, due to the shift in focus from space tourism to satellite launches. As the two companies worked to meet the market, plans had to change. But in terms of the space industry, that’s likely a change for the better.
“Both companies have pivoted during their development states,” says Ostrove. “That has delayed their entry into the market, but it seems like they are on more sustainable paths at this point. Obviously, problems could still develop, but the satellite launch market is more established than the space tourism market both in terms of customers and technologies, so that should allow them to launch by 2020.”
If all goes well, though, this new space race won’t be about who can do what first, but rather about building a competitive, sustainable market in space.