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Start New Space: the New Kids on the Launchpad
25 May 2017

New Space: the New Kids on the Launchpad

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Last February 27, SpaceX announced its intention to launch in 2018 a spacecraft that will travel around the Moon carrying two paying passengers. It will mark the first return of human beings to deep space since the Apollo 17 mission in 1972. This is the latest of the audacious gambles from the technology engineer and magnate Elon Musk, founder of SpaceX and one of the most visible heads of the phenomenon known as NewSpace.

Musk is not alone in this trend. Together with him are Amazon founder Jeff Bezos with his company Blue Origin, Sir Richard Branson with Virgin Galactic and the hotelier Robert Bigelow with Bigelow Aerospace. They are just a few examples of the multitude of companies with all sorts of aspirations focused beyond Earth, from collecting space debris to exploiting extra-terrestrial deposits, all the way to colonizing other planets.

Una de las naves de Blue Origin despegando. Crédito: Blue Origin
A Blue Origin aircraft restarted at 3,635 feet above ground level and ramped for a successful landing. Credit: Blue Origin

The participation of private companies in the aerospace sector is not something new: the space race of the 1950s and 1960s would not have existed without the participation of numerous contractors. But NewSpace is different. Industry analyst Matthew Weinzierl, a Harvard Business School professor, defined it as a set of start-ups willing to “disrupt the American space sector with new technologies, management approaches and competitive pressure.” However, Weinzierl admits to OpenMind that “NewSpace is a controversial term,” even within the sector itself. “The distinction is not really public versus private, or even young versus established,” he says. “I would say the key differences are in mentality and business model.”

The approach born in the spirit of Silicon Valley

The re-named Old Space has traditionally been a very centralized universe; the USA, with NASA in the middle, has forged long-term relationships with private companies. And although some industry watchers have accused it of being slow, bureaucratic and hesitant, it is a model that has brought great achievements, “a fact often overlooked by NewSpace enthusiasts,” remarks Weinzierl. This new trend emerged when the US retired its manned space shuttles from service without yet having an alternative. “A group of entrepreneurs sensed an opportunity to try a new approach,” says the economist.

This is where a different business culture comes into play, born in the spirit of Silicon Valley: start-up companies convinced that new ideas and competition will drastically reduce costs in the conquest of challenges that today are still far away for Old Space, such as trips to the Moon or Mars. As Michael Smart, professor of hypersonic propulsion at the University of Queensland (Australia) and former NASA scientist, summarizes for OpenMind: “They have a vision, and they have shown themselves able to take risks to fulfil that vision.”

El astronauta Dale A. Gardner sujeta el cartel de "Se vende" en referencia a dos satélites recuperados. Crédito: NASA
Astronaut Dale A. Gardner holds up a “For Sale” sign refering to two satellites that they retrieved from orbit. Credit: NASA

Among these new ideas is that NASA does not have to be the main client, but only one among several. In fact, a common feature of several NewSpace companies is the desire to monetize their business by focusing on their services to private customers. Virgin Galactic or Blue Origin will offer space flights to the general public. For his part, Musk not only asks for the Moon, but also Mars. In September 2016, the founder of SpaceX announced his intention to establish a colony on the neighbouring planet in the next decade.

Some NewSpace projects already go far beyond being just ideas. On the front line of the advance is SpaceX, which already uses its Falcon 9 rocket to send its Dragon 1 capsule to the International Space Station on unmanned cargo transport missions. But if SpaceX has been equalled in this feat by the traditional operators, it has surpassed them in the recovery and reuse of its rockets, something never before tried by state agencies.

NASA adapted to Old and New Space

All this does not imply, the experts observe, that a new space race is underway, this time between Old Space and NewSpace. Weinzierl said that NASA initially reacted cautiously to NewSpace, but later adapted its regulatory framework to establish commercial ties with these new companies, provided that they bear some of the development costs and thus help to reduce the public bill of the space program. On the other hand, the companies of Old Space have also joined these new approaches. The result, analysts say, should benefit all the parties and human activities in space.

Space X’s rocket prepares to land for the second time. Credit: Space X

Last February, The Wall Street Journal released an e-mail in which a member of NASA advocated a competition between Old Space and NewSpace to determine which could guarantee a return to the Moon in the next decade. This episode hints that the two models do not yet dovetail.

Another question concerns the viability of the ambitious projects that the companies of NewSpace are announcing with great impact in the media. “Setting lofty goals is part of their mantra; it is investors who will decide if the hype is real,” says Smart. At the moment, Virgin Galactic has repeatedly delayed the beginning of its operations, and SpaceX should have released its Falcon Heavy rocket earlier this year, which has not happened. Weinzierl believes that today it is very difficult to know if NewSpace will meet its expectations. The expert feels that some of their business models “are not viable on their own”; it escapes no one paying attention that Musk’s Martian dream is far from being affordable today. According to Weinzierl, the key breakthroughs that will make projects viable are still to come. “But I’m optimistic,” he concludes. “I’d like to stay in a space hotel in my lifetime!”

Javier Yanes for Ventana al Conocimiento


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