The Current Crop of Commercial Starts-Ups in Space Were not the First

SpaceX Dragon capsule docked to the International Space Station in 2013.

SpaceX Dragon capsule docked to the International Space Station in 2013.

Many journalists and others have been much enamored with the activities of Elon Musk, Jeff Bezos, Sir Richard Branson, and other entrepreneurs who have bet their fortunes, at least some of their fortunes, on the development of new space access vehicles and commercial prospects in Earth orbit and perhaps beyond. For all of their successes, and those deserve proper kudos, there is a history of earlier efforts that deserves to be a part of this larger story to develop space as another realm of ordinary human endeavor.

In response to the Reagan administration’s efforts to open commercial space activities in 1984, with the “Commercial Space Launch Act of 1984” a number of firms arose to fill an apparent need for commercial launch services. The one corporation to survive those early heady years and become a major player in space access was the Orbital Sciences Corporation founded in 1982 by a daring group of under-30 space entrepreneurs led by David Thompson. With an initial investment of only $1,500, the company went on to develop the air-launched Pegasus space access vehicle.

With the Pegasus’s first deployment from a modified L-1011 the firm took off, literally, and by the end of 1990 had grown to over 700 employees and $100 million in annual revenues. It was the first entrepreneurial space company to “go public,” and Orbital/ATK remains a major space launch provider to the present. It is important to remember this as accolades accrue to SpaceX and other entrepreneurial firms for their successes.

Orbital's Lockheed L-1011 Stargazer launches Pegasus carrying three satellites in 2006.

Orbital’s Lockheed L-1011 Stargazer launches Pegasus carrying three satellites in 2006.

Additionally, by the mid-1990s several other start-up companies had been organized to develop new vehicles in response to an envisioned expansive market for space launch services. Indeed, 1996 marked something of a milestone in the history of space access. In that year worldwide commercial revenues in space for the first time surpassed all governmental spending on space, totaling some $77 billion. This growth continued in 1997, with 75 commercial payloads lofted into orbit, and with approximately 75 more military and scientific satellites launched. This represented a threefold increase over the number the year before.

Market surveys for the period thereafter suggested that commercial launches would multiply for the next several years at least: one estimate holding that 1,200 telecommunications satellites would be launched between 1998 and 2007. In that context many space launch advocates believed that the market had matured sufficiently that government investment in launch vehicle development was no longer necessary. Instead, they asked that the Federal government simply “get out of the way” and allow the private sector to pursue development free from bureaucratic controls.

Pictured is a drawing of Kistler's rocketplane,

Pictured is a drawing of Kistler’s rocketplane,

This modern “gold rush” sparked several new corporations to muscle their way into the tight conglomerate of launch vehicle companies. One of the farthest along and best financed of this new breed was Kistler Aerospace Corporation, based in Kirkland, Washington. Seeking low-cost access to space, Kistler employed Russian-built engines as a centerpiece of its K-1 reusable launcher. It was intended to deliver up to 10,000 pounds to orbit, depending on inclination. The first stage of this vehicle would fly back to the launch site; the second would orbit Earth before returning. Both stages would descend by parachute and land on inflatable air bags. Sound familiar? Unfortunately, the company was unable to deliver on its plans and eventually folded.

Rotary's Roton ATV (Atmospheric Test Vehicle) approach and landing demonstrator made a flight for 4,300 feet along a Mojave airport runway, October 12, 1999.

Rotary’s Roton ATV (Atmospheric Test Vehicle) approach and landing demonstrator made a flight for 4,300 feet along a Mojave airport runway, October 12, 1999.

Pioneer, Inc., also worked to develop the Pathfinder rocketplane, an aerial propellant transfer spaceplane that would accommodate a crew of two and deliver a payload of 5,000 pounds to low-Earth orbit (LEO). Additionally, Kelly Space and Technology, Inc., worked on its Astroliner, a reusable spaceplane that was intended to deliver 11,000 pounds to LEO for a cost of $2,000 per pound. Among these various companies the most interesting concept, albeit one that many people believed was doomed to failure from the start, was the Roton rocket built by the Rotary Rocket Company. Roton was intended as a fully reusable, single-stage-to-orbit (SSTO) space vehicle designed to transport up to 7,000 pounds to and from LEO. Roton planned to enter commercial service in the year 2000 with a target price per flight of $7 million ($1,000 per pound). None of these start-ups survived to fly  successful space mission.

Other space launch firms experimented with unique launch approaches, and some have been successful. The Sea Launch Company LLC used a floating mobile platform that could handle launches of heavy vehicles out of its Long Beach, California, facilities. This launch method reduced legal, operational, and infrastructure costs. Since it was mobile it offered equatorial launches in any inclination from a single launch pad, providing maximum efficiency from the launcher.

A Sea Launch LLC launch from a floating platform.

A Sea Launch LLC launch from a floating platform.

Established as a partnership between Boeing (USA), Aker ASA (Norway), RSC-Energia (Russia), and SDO Yuzhnoye/PO Yuzhmash (Ukraine) the Sea Launch Company was organized on April 3, 1995. It had the backing of large aerospace firms, and was less entrepreneurial than some of the other corporations that had emerged ear the same time.

Once stood up, Sea Launch constructed its platform and launched its first test payload into orbit on March 27, 1999. Using a jointly produced Zenit-3SL launcher built in the Ukraine, Russia, it flew its first commercial payload on October 9, 1999, a DIRECTV 1-R communications satellite. Since that time Sea Launch has made 36 launches, with three failures and one partial-failure. This system was touted as a major success story in international commercial cooperation for space access, the road for the company has been rocky. It filed for Chapter 11 bankruptcy in June 2009, with the Russian backers absorbing most of the stock to keep it afloat. Since then the company has withered.

Despite some successes, only Orbital Sciences and Sea Launch LLC had yielded a new operational space launcher by 2000. With the failure of the Iridium Corporation in spring 2000, a new satellite communications system that many believed would be the vanguard of a rapidly expanding space launch market, investment for space enterprises became even scarcer. In some measure because of this, although they had previously eschewed government investment and the corresponding red tape, many of these start-ups began seeking capital from NASA and the military to support their efforts. Accordingly, it seemed that as the twenty-first century began there was still a pressing need for substantial government investment in space launch R&D. Enter SpaceX and a range of other firms in the early twenty-first century. It’s a story that is far from being complete.

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2 Responses to The Current Crop of Commercial Starts-Ups in Space Were not the First

  1. Mario Mirarchi says:

    Don’t forget Dr. Gerard K. O’Neill, Lutz Kayser of OTRAG, and Klaus Heis.


  2. I appreciate your post showing that the current boom in commercial space development didn’t come out of the blue, so to speak, but builds upon previous surges in commercial activity. And I agree that it is important to ponder what can be learned from these episodes. I interviewed Elon Musk in 2003 ( and he, in fact, cited lessons learned from some of the 1990s projects such as the need to have sufficient capital to see a project through testing. As it turned out, SpaceX almost didn’t have enough capital to survive its tests.

    Your primary lesson, however, seems to be that reality hit those silly libertarian rocket guys upside the head and they had to go back and beg NASA for money.

    I think a different lesson is more appropriate if one takes a broader view of what happened from the 1980s through the early 2000s.

    Firstly, you point to a number of launch venture failures and a couple of partial successes. However, NASA was not exactly covering itself in rocketing glory during this period. The X-33, X-34, and X-38 projects all failed. The OSP and SLI programs failed. There was the catastrophic failure of Columbia. (Up to that time many NASA managers were expecting the Shuttles to operate until the 2030s despite the enormous cost of operating them.) The Ares I was supposed to be “Safe, Simple, and Soon” but it was none of these and it was canceled after it went over budget and years behind schedule.

    So COTS/CRS/Commercial Crew programs were not lifelines thrown by NASA to save a sinking commercial launch industry. They were lifesavers grabbed by both. NASA desperately needs commercial launch to succeed if it is to fulfill its primary missions within its budget. Commercial launch providers need government markets to boost launch rates to a sustainable level.

    And so far these programs have worked extremely well for all involved. For example, NASA’s own study of the SpaceX Falcon 9 development found that it was developed for 10 times less than the official NASA/USAF NAFCOM cost model said it should cost. Dan Rasky of NASA Ames talks about the study in this NASA video –

    In addition, GEO satellite companies started buying US launch services again because of the low F9 prices. ULA and Arianespace (i.e. Airbus/Safran) are developing new lower cost rockets to compete with SpaceX.

    Secondly, from my interactions with commercial space community over the past 25 years or so, I’ve seen far less of the “lets eschew government investment and the corresponding red tape” attitude than I’ve seen of the “lets get NASA back to a NACA model that works with rather than dictates to commercial industry”.

    It was, after all, commercial space advocates who pushed for the Launch Services Purchase Act of 1990, which amended NASA Charter (Paragraphs 203(a)) to instruct the agency to
    “4) seek and encourage, to the maximum extent possible, the fullest commercial use of space; and

    (5) encourage and provide for Federal Government use of commercially provided space services and hardware, consistent with the requirements of the Federal Government.”

    So 16 years before COTS began, the commercial space industry was not eschewing government investment but pushing explicitly for a COTS/CRS approach involving NASA purchase of launch services.

    Finally, as a side note, I must point out that the passage of the “Commercial Space Launch Act of 1984” was heavily influenced by the experience of Deke Slayton et al with the Conestoga rocket, which in 1982 became the first privately funded rocket to reach space. They needed something like 15 signatures from Federal, State and local government agencies before they could launch. A prime motivation of the CSLA was to provide a one-stop licensing process for such rockets. A case of the government reducing red tape and in turn helping commercial ventures attract investment.


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