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Commercial Space Activities

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Brief Introduction

U.S. Commercial Space Policy and NASA's "Commercial Crew" and COTS Programs|

Commercial Suborbital Launches

U.S. Aerospace Companies

Major Non-U.S. Aerospace Companies

 

BRIEF INTRODUCTION


The "Space Economy"

As published by the Space Foundation in The Space Report 2014: The Authoritative Guide to Global Space Activity, the global "space economy" in 2013 was $314.17 billion, an increase of 4 percent over the previous year.  This annual report from the Space Foundation tracks worldwide spending by governments, the private sector and consumers. According to the report (available for purchase), this $314.17 billion space economy is comprised of the following segments:

  • commercial infrastructure and support Industries, 37% ($117.49 billion)
  • commercial space products and services, 39% ($122.58 billion)
  • U.S. government space budgets, 13% ($41.26 billion), and 
  • non-U.S. government space budgets, 11% ($32.84 billion)

Defining "Commercial" Space Activities

What makes a space activity "commercial" can be difficult to define. Some consider a commercial activity to be one in which a private sector entity puts its own capital at risk and provides goods or services primarily to other private sector entities or consumers rather than to the government. Examples of these activities would be direct-to-home satellite television (e.g. DirecTV and DishTV), satellite radio (Sirius XM), and commercial fixed satellites that transmit voice, data and Internet services (such as Intelsat Ltd., SES Global, and Eutelsat).

Other definitions are broader and include sales of consumer equipment by companies even though the satellite system is owned by the government. The chief example of this is the Global Positioning System (GPS) navigation satellite system that is owned by the U.S. Department of Defense, but has a vast array of consumer users ranging from automobile navigation systems to cell phones to precision farming. The devices used by consumers around the world in their cars, on their boats, or carried on their persons are sold by commercial companies, but the satellite signal that makes them work is provided for free by DOD.

Still broader definitions of commercial space activities include those where a company provides services primarily to government customers, such as the Boeing-Lockheed Martin United Launch Alliance (ULA), or the remote sensing satellite company DigitalGlobe. Others do not consider these commercial because they are reliant on the government for most of their revenue and the government shoulders a major portion of the risk because the government requires the services.

In his National Space Policy issued on June 28, 2010, President Obama defined "commercial space activities" in this manner:

The term "commercial," for the purposes of this policy, refers to space goods, services, or activities provided by private sector enterprises that bear a reasonable portion of the investment risk and responsibility for the activity, operate in accordance with typical market-based incentives for controlling cost and optimizing return on investment, and have the legal capacity to offer these goods or services to existing or potential nongovernmental customers.


U.S. COMMERCIAL SPACE POLICY


The government plays a major role in commercial space activities in many ways, from establishing regulatory policy, to creating policies that direct government agencies to purchase services from companies, to contracting for hardware. For example, the government signed contracts for guaranteed data buys from two commercial remote sensing satellite companies, GeoEye and DigitalGlobe, which enabled them to raise the capital needed to build and launch the satellites.  In 2012, however, the government decided it could not support both companies and the result was that the two merged.  DigitalGlobe is the survivor.

U.S. commercial space policy has been part of national space policy for decades and today is defined by President Barack Obama's 2010 National Space Policy, which supersedes President George W. Bush's 2006 National Space Policy

On November 21, 2013, the Obama Administration released an updated National Space Transportation Policy and an associated fact sheet.

The Federal Aviation Administration's Office of Commercial Space Transportation (FAA AST) regulates and facilitates the commercial space launch business. The Federal Communications Commission (FCC) assigns radio frequencies and issues licenses for commercial satellite systems.  The National Oceanic and Atmospheric Administration (NOAA) issues licenses for commercial remote sensing satellites.

NASA'S COMMERCIAL CREW AND COMMERCIAL CARGO (COTS) PROGRAMS

Commercial Crew.   President Obama proposed a dramatic change to the U.S. human spaceflight program in his FY2011 budget request to Congress, released February 1, 2010.  He proposed relying on the commercial sector instead of NASA to build and operate systems to take people to and from low Earth orbit (LEO).  That includes taking NASA astronauts to and from the International Space Station (ISS).   He requested $6 billion over 5 years (FY2011-2015) in NASA's budget to subsidize companies to develop "commercial crew" launch vehicles and spacecraft for LEO missions.  He also wanted to cancel the Constellation program, begun under President George W. Bush, for NASA to build new launch vehicles (Ares I and V) and a spacecraft (Orion) to take astronauts back to the Moon and on to Mars, as well as to and from ISS.   Instead, President Obama proposed that the United States rely on the commercial sector to build new crew space transportation systems for use in LEO, which would free NASA to focus on developing technologies that could someday be used to take astronauts to more challenging destinations beyond LEO.   He wanted NASA to spend several years investing in "game-changing" technologies before deciding on what systems to build.

The lack of a specific destination and timetable for these "beyond-LEO" human spaceflight missions made his proposal especially unpopular and on April 15, 2010, he elaborated on his plans in a speech at NASA's Kennedy Space Center in Florida.  At that time he made clear that he saw no need for U.S. astronauts to return to the Moon, but landing people on Mars remained the eventual goal, and he said he expected that to happen in his lifetime.  Meanwhile, he wanted NASA to focus on sending astronauts to an asteroid by 2025 as his initial beyond-LEO destination, and send them to orbit (but not land on) Mars in the 2030s.

The proposal was very controversial and vigorously debated in Congress. The 2010 NASA Authorization Act (P.L. 111-267), signed into law in October 2010, is a compromise wherein NASA is directed to develop its own crew space transportation system -- the Space Launch System (SLS) and a Multi-Purpose Crew Vehicle (MPCV) -- as well as fund the commercial crew concept, but at a lower funding level.  The law requires that the SLS/MPCV system also be able to function as a backup for commercial crew in case those systems do not materialize or if they fail.  NASA selected the Orion spacecraft that was being developed in the Constellation program as the MPCV, so the system now is usually referred to as SLS/Orion.

President Obama's FY2012 budget request for NASA, released in February 2011, was similarly controversial because the congressional committees that oversee NASA believed that it contravened the compromise reached in the 2010 NASA Authorization Act.  NASA requested more money than was authorized for commercial crew and less money than was authorized for SLS/MPCV. 

Meanwhile, with the termination of the space shuttle program in 2011, NASA no longer can launch astronauts to the ISS.  How long this "gap" between the end of the shuttle program and the availability of commercial crew services will last is unclear, but at least for several more years.    NASA now purchases crew transportation services from Russia at a cost of approximately $450 million per year.

Congress and the White House continue to have tense relationships over the commercial crew initiative, although with the success of commercial cargo missions (see below), those relationships are easing.   However, for FY2011, FY2012, and FY2013, Congress provided sharply less funding than the Administration requested.   The request for FY2013 was $830 million, for example, but Congress approved only $525 million.   The request for FY2014 was $821 million.  The final version of NASA's appropriations for FY2014, part of the Consolidated Appropriations Act (usually called "the omnibus") provides $696 million. Though it is $125 million less than the request, it is more than the agency has received in the past and the percentage cut is less, leading many commercial crew advocates happy with the result nonetheless.

NASA initially awarded contracts to five companies for Crew Transportation Concepts and Technology Demonstration, or CCDEV (commercial crew development) in February 2010: Blue Origin, Boeing, Paragon Space Development Corp., Sierra Nevada Corp., and United Launch Alliance.  Another round of winners of the CCDEV2 competition were announced in April 2011: Blue Origin, Boeing, Sierra Nevada, and SpaceX.   Those contracts were awarded as Space Act Agreements (SAAs) where NASA can pay companies for meeting agreed-upon milestones, but has little oversight or insight into what the companies are doing.  NASA planned to adopt traditional procurement methods under the Federal Acquisition Regulations (FAR) for the next phase of commercial crew development -- specifically, fixed price contracts -- but changed course in December 2011 because of budget uncertainties in future years that it concluded made fixed price contracts unrealistic.

The budget outlook for NASA and other federal agencies that are part of the "discretionary" portion of the federal budget is for sharply constrained funding indefinitely as efforts to reduce the deficit dominate the political landscape.  Congress also has made clear that funding for the NASA-developed SLS and Orion should have higher priority than commercial crew.

The CCDEV program transitioned into the Commercial Crew Integrated Capability (CCiCAP) program for the commercial companies to develop an integrated crew transportation system (spacecraft, launch vehicle, and ground systems).  In August 2012, NASA selected "2 1/2" proposals, meaning it is fully funding two companies' proposals (SpaceX and Boeing) and partially funding a third (Sierra Nevada).  The SpaceX proposal is to use its Falcon rocket for commercial crew as it does for the commercial cargo program.   Boeing and Sierra Nevada each are developing crew capsules only and plan to launch them using the Atlas V rocket built by the United Launch Alliance (ULA).   ULA and NASA had an unfunded Space Act Agreement so the two could exchange information about how Atlas V can meet the commercial crew requirements.  That agreement was completed in October 2012. 

NASA is currently considering proposals for the next phase of the commercial crew program, designated Commercial Crew Transportation Capability (CCtCAP).  These will be FAR-based contracts and awards are expected in 2014.

Estimates vary as to when a commercial crew capability will exist.  NASA is planning on 2017, but some of the companies assert they could be ready sooner.  At a September 2012 congressional hearing, NASA Associate Administrator for Human Exploration and Operations Bill Gerstenmaier conceded that the government is paying 80-90 percent of the costs for the development of these "commercial" systems. 

Commercial Cargo.  Before the Obama "commercial crew" proposal was announced, NASA already had initiated a "commercial cargo" program to rely on the commercial sector to take cargo to ISS. Called COTS (Commercial Orbital Transportation Services), it is needed because the Bush Administration decided to terminate the space shuttle program once ISS construction was completed.  Originally the shuttle was intended to take both crews and cargo to ISS throughout its lifetime.  Instead, the last space shuttle mission took place in July 2011, while the Obama Administration wants to keep the ISS operating at least until 2024.  Two companies, SpaceX and Orbital Sciences Corp., were awarded Space Act Agreements to develop spacecraft and rockets to take cargo to the ISS beginning in 2011.

That date slipped, but both systems are now operational and have transitioned into the operational Commercial Resupply Services (CRS) phase.  NASA has signed contracts for 12 SpaceX and 8 Orbital Sciences CRS missions. 

SpaceX conducted its test flight of the Falcon 9 launch vehicle and Dragon spacecraft to the ISS in May 2013. The first SpaceX operational CRS flight took place in October 2012 and two more have been conducted since then.  SpaceX launches from Cape Canaveral, FL.  The Dragon spacecraft returns to Earth and splashes down in the Pacific Ocean off of California.   Dragon is the only cargo spacecraft that services ISS capable of returning cargo to Earth.  All the others (Russia's Progress, Europe's ATV, Japan's HTV and Orbital Sciences Corporation's Cygnus) are not designed to survive reentry and burn up in the atmosphere.  They therefore are used for trash disposal - a less glamorous, but still critical task.

Orbital Sciences conducted its test flight of the Antares rocket and Cygnus spacecraft to the ISS in October 2013; the first operational CRS flight (Orb1) was launched in January 2014 and the second in July 2014.   Orbital launches Antares from the Mid-Atlantic Regional Spaceport (MARS) at NASA's Wallops Flight Facility on the coast of Virginia.

The COTS program now has ended.  NASA held a press conference in November 2013 heralding its success and later released a report

Two important points are that commercial cargo was a Bush Administration initiative and well underway by the time President Obama took office, and that although the names "commercial cargo" and "commercial crew" imply that the systems are being built at the expense of the private sector, the companies are supported by taxpayer dollars.   NASA spent about $800 million on the COTS commercial cargo program for system development (services are paid for separately).   According to NASA's FY2013 budget book, NASA expects to spend about $4.8 billion (FY2011-2017) supporting commercial crew systems development.   How much the companies themselves are investing is proprietary information.  The government will be a major customer for the services the companies offer, providing more funds.   It might be more accurate to refer to these endeavors as public-private partnerships than "commercial." 

OTHER COMMERCIAL SUBORBITAL AND ORBITAL VEHICLES AND MODULES

Suborbital flights that do not go into orbit around Earth, but fly in a high arc and provide several minutes of microgravity on the return to Earth, also are of interest. They are commonly used not only in the United States, but in many other places around the world for experiments that need minutes, but not hours or days, of microgravity. Traditionally, government agencies are the providers of these services and also are users along with academic institutions and others.

Several U.S. companies are interested in providing suborbital launches either for experiments or for sending people into space on a commercial basis. There is no legal definition of where air ends and space begins, but the Federation Aeronautique Internationale (FAI), which certifies air records, uses 100 kilometers as that boundary. In 2004, Burt Rutan's Scaled Composites won the Ansari X-Prize award for using its SpaceShipOne to send a pilot over that threshold and back to Earth twice within 14 days (different pilots flew the craft each time). Richard Branson's Virgin Group created a company, Virgin Galactic, to take anyone with the requisite funds (approximately $250,000) on such suborbital flights using SpaceShipTwo, which is still in development.

Other companies also are interested in the commercial suborbital market for experiments, people, or both. On August 9, 2011, NASA announced the selection of seven companies for indefinite-delivery indefinite-quantity (IDIQ) contracts under its Commercial Reusable Suborbital Research (CRuSR) program to provide suborbital launch services for NASA technology experiments. The total value of all the contracts is $10 million. The companies selected are: Armadillo Aerospace, Near Space Corp., Masten Space Systems, Up Aerospace Inc., Virgin Galactic, Whittinghill Aerospace LLC, and XCOR.

Some companies also have announced plans to build systems to take people into orbit on a commercial basis separate from NASA's commercial crew program.   Virgin Galactic is one.   Another is Stratolaunch, an air-launched concept announced in December 2011 by Microsoft co-founder Paul Allen, SpaceX founder Elon Musk, and Burt Rutan, who is now retired from Scaled Composites (now part of Northrop Grumman), but was a major contributor the SpaceShipOne effort.

Separately, Robert Bigelow, owner of Budget Suites of America hotels, has been working for several years on a commercial space station using inflatable modules.  Two subscale prototypes --Genesis I and Genesis II -- were launched on Russian rockets in 2006 and 2007 respectively.   Bigelow Aerospace has been working with Boeing for several years to create a transportation system to take people back and forth to full scale space stations when they are launched.  The Boeing spacecraft is the CST-100, which is also now being considered as part of NASA's commercial crew initiative.  It would be launched aboard an Atlas V launch vehicle.  In May 2012, Bigelow Aerospace announced an agreement with SpaceX to market their combined capabilities to launch people to space where they could stay aboard Bigelow space stations.  The services will be marketed only outside the United States.  In January 2013, NASA announced that it signed a $17.8 million contract with Bigelow Aerospace that could lead to adding one of Bigelow's inflatable modules to the International Space Station (ISS).  Bigelow's inflatable structures effort traces its roots to NASA's cancelled Transhab project to provide crew quarters on the ISS using an inflatable module.

OTHER COMMERCIAL SPACE CONCEPTS

Several well known U.S. billionaires working with experienced space entrepreneurs announced plans in April 2012 to mine asteroids.  The company, Planetary Resources Inc., reportedly was three years old at that point, but its founders decided to publicize it only in 2012. Backers of the company include movie producer and explorer James Cameron, Google executives Larry Page and Eric Schmidt, former Microsoft executive Charles Simonyi who flew into space twice as a space tourist on Russian Soyuz spacecraft, and space entrepreneurs Peter Diamandis and Eric Anderson.   More recently the company emphasizes that it wants to prospect, not mine, asteroids, which would come later.

Deep Space Industries, another new entrepreneurial space company that wants to mine asteroids, announced its plans in January 2013.

In December 2012, Alan Stern, a space scientist and human spaceflight advocate, announced the formation of a new company, Golden Spike, that is selling human trips to the Moon.   Stern is a former NASA Associate Administrator for Science.  He and a number of other former NASA officials, including Gerry Griffin, an Apollo flight director who later was the Director of NASA's Johnson Space Center, along with former House speaker Newt Gingrich, entrepreneur Esther Dyson, and former Governor of New Mexico Bill Richarson are backers of the project.   The group provided few details of the project at a press conference at the National Press Club on December 6, 2012, such as what rockets or spacecraft would be used.  The cost would be $1.4 billion per mission, which would take two people to the lunar surface and back. 

Dennis Tito, another billionaire, who was the first "tourist" to fly to the International Space Station on a Russian spacecraft in 2001, has formed another venture called Inspiration Mars. His initial proposal was to send two people, preferably a married couple, to Mars in 2018.  They would not land on the planet, but fly on a free-return trajectory where, once launched from Earth, few maneuvers (and therefore fuel) are needed to get them to and around Mars and return to Earth.  Their closest approach to the Martian surface would be 100 miles.  The year 2018 is important because Mars and Earth are correctly aligned only every 26 months to permit spacecraft to make the journey.  Some opportunities are better than others in terms of the amount of propellant needed; 2018 is one of the best.  The next equivalent opportunity is not for another 15 years.   In November 2013, however, Tito testified to Congress and revealed that he now wants this to be primarily a NASA mission.  NASA replied that it is "unable to commit to sharing expenses" with him.  However, the idea has evolved into a "Mars Flyby 2021" concept championed by House Science, Space and Technology Committee Chairman Lamar Smith (R-TX), for example, which would be a NASA mission.  Launching in 2021, it would need to fly first towards Venus to get a gravity assist from that planet to reach Mars since the Earth and Mars are not aligned properly for a direct flight that year.

U.S. AEROSPACE COMPANIES

Hundreds of companies are involved in the aerospace sector, even when looking only at the "space" part of the business and not aircraft. The following list is not meant to be exhaustive, but to provide links to some of the companies that are most often referenced in discussions about space policy.

The "big three" U.S. aerospace companies are:

 In addition, Boeing and Lockheed Martin co-own 

  • United Space Alliance, which operated the space shuttle and now is trying to move into other space operations areas, and
  • United Launch Alliance, which conducts launches of the Atlas V and Delta IV launch vehicles  

Other major U.S. aerospace companies that manufacture spacecraft, instruments and/or launch vehicles and/or provide launch services include:

Major U.S. companies that sell space-related products or services include:

Entrepreneurial companies:

MAJOR NON-U.S. AEROSPACE COMPANIES

There also are hundreds of non-U.S. companies in the aerospace sector. The following list is not meant to be exhaustive, but to provide links to companies that are most often referenced in discussions about space policy.   

Entrepreneurial


 

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