NASA releases industry studies of future commercial viability of low-Earth orbit
NASA today released summaries of the studies it had asked twelve private space companies to write looking into the future commercial viability of low-Earth orbit.
I’ve looked at those summaries, and found them nothing more than single view-graphs from each company selling its wares to NASA and the public. This overall analysis is quite accurate:
ISS Deputy Director Robyn Gatens told the NASA Advisory Council’s Human Exploration and Operations (NAC/HEO) committee today that the companies are “counting on NASA still to be an anchor tenant. Our desire is not to be an anchor tenant.”
She conceded that based on these studies, it does not appear that “we’ll see a dramatic reduction in what NASA will spend.” Her conclusion matches a 2017 independent analysis by the Science and Technology Policy Institute (STPI) at the Institute for Defense Analyses (IDA) that concluded “it is unlikely that a commercially owned and operated space station will be economically viable by 2025.”
In other words, at the moment everyone in this industry remains too dependent on government money. A private commercial industry in low-Earth orbit, including private space stations , might be possible, but it can’t get a foothold as long as NASA and ISS are in the game.
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NASA today released summaries of the studies it had asked twelve private space companies to write looking into the future commercial viability of low-Earth orbit.
I’ve looked at those summaries, and found them nothing more than single view-graphs from each company selling its wares to NASA and the public. This overall analysis is quite accurate:
ISS Deputy Director Robyn Gatens told the NASA Advisory Council’s Human Exploration and Operations (NAC/HEO) committee today that the companies are “counting on NASA still to be an anchor tenant. Our desire is not to be an anchor tenant.”
She conceded that based on these studies, it does not appear that “we’ll see a dramatic reduction in what NASA will spend.” Her conclusion matches a 2017 independent analysis by the Science and Technology Policy Institute (STPI) at the Institute for Defense Analyses (IDA) that concluded “it is unlikely that a commercially owned and operated space station will be economically viable by 2025.”
In other words, at the moment everyone in this industry remains too dependent on government money. A private commercial industry in low-Earth orbit, including private space stations , might be possible, but it can’t get a foothold as long as NASA and ISS are in the game.
The support of my readers through the years has given me the freedom and ability to analyze objectively the ongoing renaissance in space, as well as the cultural changes -- for good or ill -- that are happening across America. Four years ago, just before the 2020 election I wrote that Joe Biden's mental health was suspect. Only in this year has the propaganda mainstream media decided to recognize that basic fact.
Fourteen years ago I wrote that SLS and Orion were a bad ideas, a waste of money, would be years behind schedule, and better replaced by commercial private enterprise. Even today NASA and Congress refuse to recognize this reality.
In 2020 when the world panicked over COVID I wrote that the panic was unnecessary, that the virus was apparently simply a variation of the flu, that masks were not simply pointless but if worn incorrectly were a health threat, that the lockdowns were a disaster and did nothing to stop the spread of COVID. Only in the past year have some of our so-called experts in the health field have begun to recognize these facts.
Your help allows me to do this kind of intelligent analysis. I take no advertising or sponsors, so my reporting isn't influenced by donations by established space or drug companies. Instead, I rely entirely on donations and subscriptions from my readers, which gives me the freedom to write what I think, unencumbered by outside influences.
Please consider supporting my work here at Behind the Black.
You can support me either by giving a one-time contribution or a regular subscription. There are five ways of doing so:
1. Zelle: This is the only internet method that charges no fees. All you have to do is use the Zelle link at your internet bank and give my name and email address (zimmerman at nasw dot org). What you donate is what I get.
2. Patreon: Go to my website there and pick one of five monthly subscription amounts, or by making a one-time donation.
3. A Paypal Donation:
5. Donate by check, payable to Robert Zimmerman and mailed to
Behind The Black
c/o Robert Zimmerman
P.O.Box 1262
Cortaro, AZ 85652
You can also support me by buying one of my books, as noted in the boxes interspersed throughout the webpage or shown in the menu above. And if you buy the books through the ebookit links, I get a larger cut and I get it sooner.
This has to be one of the most depressing reports I have read in a long time. The summaries presented only plans and timelines for creating operational revenue hardware, but gave no non-NASA/ISS partner potential customers, gave no potential dollar income (economy predictions), or specifics on the kinds of facilities that potential customers currently desire.
I suspect that the scope of the study was lacking such specific information, as all the summaries provided similar information: Vision & Approach, (study) Team, Concept, and Schedule. McKinsey provided Key Findings and (future) Action, but none of these present any information about who wants to pay for space access or business, examples what they want to do there, or how much they think they may be willing to pay for it.
The study only tells us what a few companies plan to do for customers, but it seems that this study did not include any surveys of potential customers. It lacks any information on what these companies need to provide and why they need to provide it, for whom, and how little they need to spend in order to make that happen profitably for their customer base and for themselves. It fails to give estimates of numbers of customers at any price point.
The most useful item seems to be from McKinsey: “Left to its own devices, the market may develop a mismatch between supply and demand (too many modules, not enough occupants or vice versa).” That seems just a bit obvious, doesn’t it?
Unfortunately, the analysis does not say which is most likely (the vice, the versa, or the well matched supply for the demand), nor does it say what external devices are needed to avoid such a mismatch situation.
I do not understand how this study “will inform NASA’s future policies to support commercial activities that enable a robust low-Earth orbit economy,” as stated in the article in the first link. Without potential customer input, how does NASA know that future policies will help attract customers for these (and similar) companies? Why would they think that their policies will allow for prices to be low enough and access to be available enough to attract these customers?
We shouldn’t get rid of ISS until replacements exist. This creates the problem of funding because NASA has a lot of stuff going on and has a limited budget. Post ISS, the options could be great for proving affordable missions for NASA and researchers but the transition will suck.
I don’t like the statement about NASA not being an anchor tenant. NASA could send astronauts to a number of stations for a fraction of the cost of ISS. What do they think will happen to the ISS budget, it get moved to SLS?
Some of the companies that want to operate in LEO would also participate in NASA broader aspirations for the Moon and Mars. Supporting them in LEO creates more nodes and the more nodes, the more chances for people to make money and develop technologies, which in turn allows NASA to do more things.
The PDF is short on information so more research is required. Outside of this summary, the Nanoracks people sound like they have a good business case. Northrup Grumman could easily move forward if they choose to and have customers. First step is not being a garbage barge.
Looking at the list of participants, part of the problem may be that many of these companies are only currently active doing government contracting. So when NASA says they don’t want to be the anchor tenant, maybe they don’t want to be their only customer. They aren’t exactly “commercial” options, they are contractor options.
Is this the goal? The quote is out of context so it is hard to judge. The issue really isn’t how much NASA spends but what they do with the money they spend. Spending the same amount on patronizing several stations as they do now is just fine if they are able to get more things done.
Perhaps a good way to look at it is what NASA would spend for something very specific, so that the alternatives could be compared. Of course, this is very hard because NASA’s costs are obfuscated, which is a great reason to transition to commercial, pay for defined goods and services, is a good route to take regardless. However, NASA’s involvement ads a layer of obfuscation too!
wodun asked: “Is this the goal? … Spending the same amount on patronizing several stations as they do now is just fine if they are able to get more things done.”
I suspect the goal is to transition from NASA and the ISS partners from being a Monopsony, as mike shupp (and perhaps others before him) noted, to an economy in which there are multiple customers.
https://behindtheblack.com/behind-the-black/points-of-information/nasa-awards-maxar-gateway-power-communications-contract/#comment-1067508
Whether or not we see NASA reduce spending is less important than others getting involved in the use and exploration of space.
As long as NASA is the dominant customer, we will mostly get only what NASA wants. Once the rest of us become the majority customers, we will start to get mostly what we want.
The most depressing part of the summaries comes from McKinsey. To (mis)quote: “In six years, the demand will be the same as today.” (“Total expected demand in 2025 (~6 people full-time) could be served by a single ISS-capacity module“) This summary reports that there will be no increase in demand due to other space programs, additional companies having ideas to try, or universities with grants to test new things.
It seems (I hope they are wrong) that demand will be the same as when ISS was declared operational, almost a decade ago. Despite an expected reduction in the cost of transportation to space stations, an expected reduction in the cost of establishing space stations, and an expected increase in the number of space stations, demand is expected to remain unchanged.
“Reduce the cost and they will come,” was the idea, two decades ago. Now that we are on the verge of this goal, they seem unwilling to come.