Commercialising the cosmos

Space was once the exclusive domain of two superpowers. Now it has become perhaps the ultimate competitive arena for two tech giants — not to mention a host of other private enterprises that see untold promise and profits in reaching for the stars. With the entrepreneur-driven commercialisation of space gathering pace, where could a synthesis of the corporate world and the cosmos eventually lead us?

Christopher Buxton, Investment Manager, Rathbones

When Stanley Kubrick set about making 2001: A Space Odyssey, a film now consistently ranked among the greatest of all time, he insisted on surrounding himself with some of the world’s leading scientific experts. It was the mid-1960s, and Kubrick, a director renowned for his perfectionism, did not want his uniquely ambitious and expensive movie to be outguessed by the future.

Space exploration was still in its infancy. In March 1965, just weeks after MGM began to tease 2001’s release, cosmonaut Alexei Leonov became the first person to “walk” in space; NASA’s Ed White followed three months later, bettering the Russian’s feat by 20 minutes in a typical display of Cold War one-upmanship. Nobody could know for certain what might be achievable in another three and a half decades, but Kubrick wanted to get as close as possible to the likely reality.

His success in this regard is evidenced by one of 2001’s most memorable sequences, which depicts a passenger-carrying Orion III “spaceplane” docking with an orbiting space station. Famously accompanied by Johann Strauss II’s The Blue Danube, the scene would in many ways prove uncannily prescient. Sure enough, we now have orbiting space stations; NASA’s space shuttles, which flew more than 130 missions between 1981 and 2011, were aircraft-like in design; and the at-seat entertainment systems that are now part and parcel of air travel can trace much of their heritage to the Orion III’s interior.

Look more closely, though, and you can see that Kubrick and his advisers presaged yet another development — one whose potentially enormous implications have only recently started to become apparent. With the iconic logo of Pan American Airways embellishing the Orion III’s flanks, 2001 correctly prophesied the commercialisation of space — save, that is, for failing to predict that Pan Am would go bust in 1991 and that spaceplanes are now more likely to carry corporate branding linked to Amazon and Tesla.

From Cold War to corporations

On 4 October 1957, to the astonishment and horror of the West, the USSR launched Sputnik I, the first-ever artificial satellite. Its radio transmitter’s distinctive series of beeps was soon picked up by the US and was sufficient to convince the stunned Americans that their technological superiority, all but undisputed since the end of the Second World War, could no longer be taken for granted.

Sputnik I was barely the size of a beach ball, but the US reasoned that it marked a major step forward in Soviet efforts to develop an orbiting nuclear-strike capability. It was the first telling blow of the original “space race” — an extraterrestrial extension of the Cold War — and it prompted a period of fierce competition fired by political tensions, military exigencies and a realisation that the heavens could represent the supreme stage for parading global prestige, scientific pre-eminence and ideological primacy.

The race peaked on 20 July 1969, a year after cinema-goers first experienced 2001’s vision of things to come, when Apollo 11 commander Neil Armstrong set foot on the Moon and declared “one giant leap for mankind”. Eleven more astronauts, all American, followed him before the enthusiasm and funds necessary for further lunar landings ran out in 1972. A spell of détente brought a US-USSR space rendezvous by 1975, and by the early 1990s, in the wake of the Soviet Union’s collapse, any lingering pretence of a race had given way to overt cooperation — as most spectacularly illustrated by the International Space Station.

Today, as the conquest of space enters a radically different era, the Cold War is long forgotten. The US and Russia have joined a dozen other nations in a quest to “expand human presence into the solar system”, and the United Nations has opened an Office for Outer Space Affairs. Yet by far the most significant shift is that companies, not countries, are now leading the way.

Two in particular are at the forefront. The first is Blue Origin, established in 2000 by Amazon founder and CEO Jeff Bezos; the second is SpaceX, established in 2002 by Tesla founder and CEO Elon Musk. Space is no longer the exclusive preserve of a select few government agencies: it is the stellar playground of tech billionaires.

The private-public paradigm

“We want a new space race,” Musk declared during a speech at Cape Canaveral last year. “Races are exciting.” At least to some extent, this is what is taking place; but this “race” is largely defined by friendly competition and is widely regarded as a prospective win-win for all concerned. To quote Professor John Logsdon, who founded the Space Policy Institute at George Washington University and helped NASA investigate the 2003 Columbia disaster: “Bezos’ style is to do things and then brag about them. Musk’s style is to brag about things and then do them.”

And they have plenty to brag about already. Blue Origin made history by completing the first-ever landing of a reusable rocket. SpaceX made history by launching the most powerful working rocket ever constructed. Both have rapidly cemented their positions as go-to contractors for NASA and other space agencies, as well as for telecommunications companies that continue to add to the thousands of man-made satellites circling the Earth. Reusable rockets operate at a fraction of the cost of their government-funded counterparts and have quickly come to constitute a reliable business model, allowing Bezos and Musk to muscle in on territory that was for decades dominated by longstanding NASA suppliers such as aerospace giants Boeing and Lockheed Martin.

This suits NASA especially well, says Professor Scott Hubbard, of Stanford University’s Department of Aeronautics and Astronautics, because it allows the agency to focus on “exploring the fringe, where there really is no business case”. Interviewed last year, Hubbard, a former director of NASA’s Ames Research Center, told “I see this not only as cooperation or collaboration but maybe even as interdependence.”

NASA itself has expressly advocated private-public partnerships. “The private sector wants to move fast and be cost-effective,” says Phil McAlister, the agency’s director of commercial spaceflight, “and NASA has 50 years of human spaceflight experience. Those two things actually complement each other very effectively.”

There is no doubt, though, that Bezos and Musk have their sights set far beyond the cargo contracts that currently fill Blue Origin’s and SpaceX’s ledgers. They are united in their determination to take people — not just astronauts but ordinary, everyday citizens — deep into space. Their respective corporate mission statements make this abundantly clear: Blue Origin is “committed to building a road to space so our children can build the future”, while SpaceX has “the ultimate goal of enabling people to live on other planets”.

Richard Branson’s Virgin Galactic is pursuing similar objectives. So, too, are the numerous start-ups that are increasingly entering the burgeoning market for commercial space travel. As has been witnessed in other technology-driven sectors, the pie is likely to be divided into ever-thinner pieces — and some of the smallest and most nimble competitors could prove to be among the genuine game-changers.

Rules, risk and reward

The emergence of a robust and even crowded marketplace, particularly one in which entrepreneurship is a key dynamic, raises a number of difficult questions. Is space the next investment frontier? Who controls space? Who owns space? As leading British space scientist Professor Monica Grady has observed: “Once investment starts to flow, lawyers won’t be far behind.”

The UN’s Office for Outer Space Affairs now oversees the Outer Space Treaty, a framework for the governance of space. By the standards of UN conventions, which are seldom succinct, the treaty has surprisingly few articles. The document was originally drawn up in 1967 — a year before 2001 made its debut and two years before the world watched in awe as Armstrong descended the ladder of Apollo 11’s lunar lander — and the text was formulated for nation states rather than for private enterprises.

It asserts, for example, that no country can lay claim to any celestial body. Yet companies are already assessing the feasibility of “space mining” and extracting water from the Moon and other natural satellites, not least because it has been estimated that using hydrogen as rocket fuel could reduce the cost of spaceflight by up to 95%. This is not a matter of curbing jingoistic flag-planting: it is a matter of containing the full might of market forces in an environment of unprecedented unfamiliarity.

Moreover, such forces are customarily rooted in the concept of risk and reward — and the risks in space are considerable. In the words of Grady, a professor of planetary and space science at the Open University: “If we look at the way more conventional businesses operate, such as supermarkets, competition drives prices down. There is little reason to believe that competition between space companies would follow a different model... in which case greater risks might be taken in order to increase profitability. As the field develops and additional private companies move into space exploration, there will be a higher probability of accident or emergency.”

Logsdon has sounded a similar warning. He fears a substantial gap between the standards adhered to by the likes of NASA and those applied by the private sector’s would-be purveyors of commercial space travel. As the super-rich jostle to journey to the stars, he says, we could soon discover whether “somebody with enough money to take a joyride around the Moon cares about NASA’s human safety requirements”.

Perhaps conscious of such concerns, Bezos, for one, is trying to shift the narrative. In recent months he has repeatedly denied the very thing that Musk has demanded. “We are not in a race,” insists the welcome message on Blue Origin’s website. “There will be many players in this human endeavour to go to space to benefit Earth. We will go about this step by step, because it is an illusion that skipping steps gets us there faster.” Does he mean it? The truth, as with so much else in this new era of space exploration, is very much up in the air.