Satellite company to SpaceX: give us $50m or a free flight

Last week’s SpaceX explosion dealt a big blow to Facebook, destroying a $200 million satellite that promised to extend the social media network’s reach across Africa. 

But a report in the New York Times points out that many other industries have been affected by the disaster. Many satellite and telecom companies were counting on SpaceX’s cheaper launch services, which are priced between $62 million and $90 million. According to analysts, this is at least 50% less than its major competitors. 

SpaceX has managed to drive down costs by stripping down launchpads and producing rockets more efficiently, as well as offering quicker launch schedules. Now there are concerns that these innovations may be coming at the cost of safety. Here are some of the organizations that might be affected:

• NASA was relying on SpaceX for cargo deliveries to the International Space Station; these may be delayed.

• Space Communications, an Israeli satellite company set to deploy Facebook’s Internet.org initiative, was on track to be sold to the Beijing Xinwei Technology Group for $285. But the deal was dependent on SpaceX launching a Spacecom satellite. Now Spacecom executives are renegotiating with Xinwei and looking at other options. Spacecom’s stock price also fell 9%. 

• A range of communications satellites meant to support international mobile phone service and digital television had been scheduled to launch with SpaceX. They may now be delayed. 

• Insurers are also feeling the burn. The majority of insurance costs take effect when the rocket is fired up, but in this case, the SpaceX rocket exploded during a prelaunch test, meaning the launch policies did not kick in. Two dozen preflight insurers will have to bear the cost of the insurance payout, but if a design, manufacturing flaw, or operational error cause the failure, launch rates for SpaceX flights in the future could go up.