With companies planning to send thousands of small satellites into orbit in the next decade, the launch industry faces enormous rewards, but also significant challenges.
Launch providers will only succeed if they reduce the cost of space transportation and provide frequent, reliable service, according to a panel of industry executives participating in a Dec. 6 discussion organized by Silicon Valley Space Startups & Satellites.
“There is a lot of opportunity for anyone that comes up with a truly cost-effective launch system,” said Luis Gomes, commercial director for the UK’s Surrey Satellite Technology Ltd.
SSTL began to notice that the price to launch satellites weighing around 50 kilograms began rising after the Russian-Ukrainian Dnepr rocket conducted its last flight in March 2015.
Currently, between 20 and 30 companies are developing launch vehicles designed to cut the cost of small satellite launches. Ultimately, however, only five or six of those companies are likely to survive long enough to begin offering commercial flights, said Chuck Lauer, co-founder and vice president for business development at Rocketplane Global, a company seeking funding for a winged spaceplane with an expendable second stage engine.
Other panelists agreed that many of the new ventures are likely to fail due to the immense challenges of developing new rockets and building profitable businesses around their ongoing operations.
“I hope some succeed,” said Kyu Hwang, strategic projects director for Vulcan Aerospace, a division of Microsoft co-founder Paul Allen’s Vulcan Inc. “Right now, the demand for launch is not being met.”
The companies that succeed will be the ones that fill a niche. “Find your own unique value proposition that the market is not filling,” Hwang said.
Through its Stratolaunch Systems subsidiary, Vulcan Aerospace plans to offer “flexible, convenient, affordable launches for small satellites,” Hwang said. To achieve that goal, Stratolaunch Systems is looking beyond the price of the rockets it will launch from the massive aircraft it is developing. In some cases, the rocket comprises only half the cost of sending a satellite into orbit. “We are looking at the whole infrastructure to reduce costs,” Hwang said. “We need to start tackling the entire equation.”
High volume is also important, Lauer said. The only way to close the business case for a small launch vehicle is to build a rocket that flies frequently. Companies developing new rockets should line up business as early as possible so they can begin commercial service as soon as they complete flight testing.
“Once you are flying, it is a high margin-per-flight business,” Lauer said. “With a high flight rate, it is a profitable enterprise.”
Interorbital Systems, a Mojave, California-based satellite and rocket manufactuer, already is making money selling its CubeSat and TubeSat Personal Satellite Kits and launches on its modular Neptune rocket, which is scheduled to begin transporting satellites into orbit in 2017, said Randa Milliron, Interorbital Systems co-founder and chief executive.
Interorbital Systems plans to launch rockets from ocean platforms to avoid the high cost and frequent delays often associated with terrestrial launch ranges. “Launch on demand is completely missing from the whole industry,” she said. “If you have to wait two years to launch, that’s not a good thing.”
Stratolaunch and Rocketplane Global also aim to offer launches on demand. “Routine access to space is one of our primary goals,” Hwang said. That assumes, however, that demand for space access rises as new launch options come on the market.
“Once the launch becomes routine, there better be more companies to take advantage of that,” Hwang said. “The next two years will tell a lot about the evolution of both the launch industry and the space data industry.”