Bulgaria credits SpaceX’s low costs for making its satellite possible


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Capitalism in space: The CEO of the Bulgarian company that built the television satellite that SpaceX plans to launch later today said that it was SpaceX’s low costs that made the satellite possible.

Maxim Zayakov, CEO of BulgariaSat and its affiliate television provider Bulsatcom, told Spacefight Now that SpaceX’s push to reduce the cost of space transportation has yielded tangible results for his country. “People don’t realize that, for small countries and small companies like us, without SpaceX, there was no way we would ever be able to even think about space,” Zayakov said. “With them, it was possible. We got a project. I think, in the future, it’s going to be even more affordable because of reusability.”

This is what I have been saying for more than a decade. You lower the costs, you make it possible for more customers to enter the market. This increase in customer base makes it possible for more launch companies to enter the market in response, and that forces the costs to drop further, which starts the whole cycle again. In the end we not only get a robust launch industry, the human race gets to settle the solar system.

The article also confirms that, at this time, SpaceX is only offering a 10% discount for the use of a reused first stage. They say this is because they wish to recoup their $1 billion investment to develop reusability. While this might be true, the real truth is that SpaceX doesn’t need to provide a larger discount. The discounted price of $55.8 million saves satellite companies another $6.2 million, which isn’t chicken feed, and offers them the cheapest launch price anywhere by far. SpaceX in turn makes more money per launch.

Should another company begin to challenge this launch price I would then expect SpaceX to lower the price further. They have the profit margin to do this.

Note that you can watch today’s Falcon 9 launch of the Bulgarian satellite at 2:10 pm Eastern at SpaceX’s website.

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14 comments

  • LocalFluff

    80 countries have higher GDP than Bulgaria, and 60 higher per capita. So there’s quite a market there. A communication, a weather, a land use observation and a military satellite should be in demand for many of them if it is for Bulgaria.

  • wayne

    Launch pushed back to 3:10pm (EST)

  • Jhon

    But if they can only launch it. I went to see the launch last week but it was postponed. But we decided to stay a few more days to see it, but it was postponed again. Fortunately they postponed it well in advance of the launch so we left when planned. We bought a year long pass for Cape Kennedy so we hope to catch another one soon. We really enjoyed the place and it is only a 3 1/2 hour drive. Very close to Disney and Universal. (about an hour)

  • wayne

    Jhon–
    How much is a Pass for Cape Kennedy? (last time I visited, was in December of 1968)

  • wayne

    Pre-game show, is now live.

  • wayne

    Not seeing Miss Tice….

  • Edward

    Robert wrote: “You lower the costs, you make it possible for more customers to enter the market. This increase in customer base makes it possible for more launch companies to enter the market in response, and that forces the costs to drop further, which starts the whole cycle again. In the end we not only get a robust launch industry, the human race gets to settle the solar system.

    This has been the basic idea of reduced launch costs. It follows from basic economics that demand increases with decreasing prices, and Maxim Zayakov’s comment certainly confirms that lower launch costs bring in more customers for the launch industry. There are several estimates showing various price points at which the launch industry and space industry will be robust enough to be self sustaining.

    It seems that SpaceX has time to recover its billion dollar investment in reusable rockets and to invest in its next venture, before the next low-cost launch provider causes them to reduce prices further.

    SpaceX has a tightrope to walk. Not only does it have to price its launches to cover for potential accidents, like last September, to recover previous investments, and to allow for future investment in new technologies and techniques, but it needs to keep its price low enough to attract enough new customers to keep the launch cadence high. Bulgaria’s entrance into the space community is the result of that last requirement.

    Bigelow (and other space habitat providers) will have a similar tightrope to walk, as space habitats become part of the space community. As the price of doing business in space drops, we should expect a large number of countries, companies, universities, and tourists to begin doing a lot of business there. Space habitats should allow for more science to be performed than we currently have on the ISS, and companies may prefer the advantages of not having to conform to NASA’s requirements — especially the sharing of data after only five years.

    Blue Origin, perhaps the next competitor for SpaceX, is now under pressure to find a way to launch payloads for less cost than SpaceX can do it. This continual increase in efficiency is what competition is all about, and is what the space industry has largely been missing for six decades.

    A good example of competition being good for the industry is the Earth imagery industry, which was kick started by Ikonos, a couple of decades ago. That industry has been so successful that Congress wants NOAA to start buying weather data from private commercial satellite companies.

    Do not forget about the new ground-based companies that are using Earth imagery and other space resources in order to make money without sending their own hardware aloft. The space business has many niches that it can move into.

    I expect the next five years to be amazing to watch, and the ten years after that to be full of expansion and businesses that weren’t even dreamed of, a couple of decades ago.

  • ken anthony

    I’ve believed in SpaceX since it was founded. The danger now is that nobody else will be able to compete because of momentum. Blue Origin may make a come from behind run, but only because of Amazon money. Although they have and may demonstrate impressive technology soon, they’re still a decade behind a moving target. The other dinosaurs are just watching the meteors fall.

  • ken anthony: As long as there is freedom, they will always be competition. SpaceX might be in the lead, but that will not last.

  • Edward

    ken anthony,
    Even if Blue Origin is not able to do better than SpaceX (and I think that there is room for improvement), Reaction Engines of Britain is working on Skylon, a reusable single stage to orbit spacecraft that breathes air while in the lower atmosphere and, when higher up, uses onboard oxidizer for its rockets. They are not yet ready to build a test vehicle, but if their idea works, then they will be the ones to beat.

    There are plenty of industries where the leading company has rested on its laurels only to be beaten by another company that took competition seriously. With competition, there is always someone trying to become the next champion, willing to find the efficiencies that will accomplish it. SpaceX is only the latest to accomplish it.

  • Anthony Domanico

    Edward,

    Respectfully, I have doubts about Skylon representing a direct competition with SpaceX. The propulsion design is complex and may be prone to many new failure modes. That alone isn’t a deal breaker, but since it’s a single stage to orbit design, it would take an enormous vehicle to loft what the Falcon 9 Block 5 will be able to do. Also, will Skylon be able to perform GTO missions?

    Another thought I just had is, perhaps in the not so distant future, a significant market for the launch industry will be in missions outside of Earth orbit. Maybe missions to the Moon, Mars, and the Asteroid Belt will be a significant percentage of the launch business and I don’t think a Skylon type vehicle would be able to perform those missions. I realize that’s speculative, so only time will tell.

    Although I’m strongly biased towards having American companies be the leaders in space enterprises, I still wish Skylon well. It’s a novel idea to be sure. Boggles my mind how they will so rapidly cool so much air to extract liquid oxygen! Pretty cool if they pull it off.

  • Edward

    Anthony Domanico wrote: “I have doubts about Skylon representing a direct competition with SpaceX.

    You and I may see a different not-so-distant future for the space industry. But if we assume that Skylon can do what it is intended to do, then it can cover geostationary transfer orbit (GTO) missions in the same way that the Space Shuttle performed them: carrying an upper stage to put the payload into GTO from low Earth orbit (LEO).

    The main question to answer is whether a single stage to orbit launch vehicle (SSTL) can perform this duty for lower cost than SpaceX’s reusable first stages, and whether an air breathing craft is even less expensive than a pure rocket SSTL. At this point, I think that it is reasonable assume that these answers are both yes.

    Since it is a major cost to carry weight from the Earth’s surface to LEO (delta V, which can translate into monetary cost), I see a not-so-distant future (20ish years from now) in which all payloads are carried only to fueling stations in LEO, which transfer lunar fuel to newly lofted satellites and probes, and space-based tugs then propel these satellites and probes to or toward their destinations.

    Anthony Domanico wrote: “Boggles my mind how they will so rapidly cool so much air to extract liquid oxygen! Pretty cool if they pull it off.

    They apparently have already demonstrated this capability, and even the US Air Force decided that the SABRE engine concept is feasible:
    http://spacenews.com/afrl-gives-seal-of-approval-to-british-air-breathing-engine-design/
    [The U.S. Air Force Research Laboratory’s] conclusion is that SABRE is an interesting technology that is technically feasible and that may find earlier applications in two-stage-to-orbit rockets or defense applications.

    I, too, have long wondered how they can cool the air to such a low temperature without clogging the heat exchanger with water ice — water vapor being so plentiful in the lower atmosphere. It could be quite some time before we know, because Reaction Engines is keeping that proprietary information as a trade secret. I can only imagine (without any evidence or knowledge on the subject) that ice crystals don’t form fast enough to cling to the heat exchanger in the time (perhaps a little over a millisecond) between reaching the freezing point to exiting the heat exchange system.

  • Anthony Domanico

    Edward,

    Those are excellent points. But if SpaceX accomplishes the reuse of the second stage in a reliable manner then the only way Skylon would be able to compete is if they either have a reusable upper stage as well or they can employ a space tug like you mentioned.

    And your rebuttals didn’t address the possibility that the Sabre engines may not be reliable. I realize that’s impossible to say one way or the other without inside information but it’s an important consideration when dealing with a radically different technology. Plus the Sabre engine is more complex and that typically leads to higher maintenance costs and possibly longer turn around time.

    Another possible issue with Skylon competing successfully with SpaceX’s technology is the fact that it’s a lifting body with wings and that introduces the issue of having to protect long thin surfaces from the extreme thermal environment. SpaceX avoids a lot of the heating by using residual propellant for retropropulsion and by having fewer protrusions from the main rocket body. As you know the grid fins get pretty toasty and that’s not even from orbital velocities. Do you think that the thermal protection system for a lifting body is sufficiently solved? Dream Chaser is a lifting body but it’s much smaller than Skylon and can afford a more robust thermal protection system.

    If my memory serves me, the Sabre engine employs many tiny tubes carrying cryogenic helium to cool the incoming air. Is that correct? I can’t imagine how they solved the water ice problem either. Did you catch the documentary on it?

    I appreciate your comments on this subject. It’s fun to discuss these things with like-minded folks. We live in an amazing time.

  • Edward

    Anthony Domanico,
    And your rebuttals didn’t address the possibility that the Sabre engines may not be reliable.

    The comments assume that the SABRE engine works as intended. Otherwise the Skylon spacecraft will not work as intended and will not be competition for SpaceX. SABRE is not guaranteed to work. Aerospace development has always been difficult, and plenty of ideas that seemed good have failed to come to fruition. However, the aerospike engine seems to be finding its time, since — at last — one company is planning to use it.
    https://behindtheblack.com/behind-the-black/points-of-information/new-smallsat-rocket-company-plans-first-flight-of-aerospike-engine/

    If Skylon fails for any of several reasons, then others will have to find better efficiencies that make SpaceX’s Falcon rocket family obsolete.

    One possible system that has some serious technical difficulties to overcome (including an abundance of space junk that can damage it) is the proposed space elevator cable (ribbon). Space elevators would make obsolete the wonderful revolutionary improvements of Falcon. While space elevators can be used to good effect on the Moon, on Mars, and at several other locations around the solar system, they would do the best at revolutionizing efficiencies when used at Earth.

    Do you think that the thermal protection system for a lifting body is sufficiently solved? Dream Chaser is a lifting body but it’s much smaller than Skylon and can afford a more robust thermal protection system.

    I think that we have learned several lessons, and I think that several of Skylon’s systems will undergo improvements at Reaction Engines learns more about actual operations. Falcon 9 went through several block designs, too, as SpaceX learned more about how to operate and improve their launch system. The Space Shuttle taught us several lessons, too.

    If my memory serves me, the Sabre engine employs many tiny tubes carrying cryogenic helium to cool the incoming air. Is that correct?

    That is my understanding.
    https://www.reactionengines.co.uk/sabre/technology/heat-exchangers/

    The air must be cooled because it heats up when it is compressed at the inlet, and compression results in heating.

    We live in an amazing time.

    I call it an exciting time, and I regret that it did not happen at the beginning of my career, when I had expected to work on these kinds of rapid improvements to space exploration.

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