What is
NewSpace?
By Charles Stotler
Manfred Lachs Conference
16-17 March 2015
NewSpace…
“…the entrepreneurial space industry…”
– Jeff Foust, “Current issues in NewSpace,” The Space Review (5 March 2007)
“…an exact, widely-accepted definition of
NewSpace still eludes the space community…”
• Circa 2006
• Evolved from ‘Alt.space’
• Suborbital and orbital vehicles
– Jeff Foust, “The evolving ecosystem of NewSpace” The Space Review (15 August 2011)
NewSpace…
“…a company that is built, formed, operated by,
funded by, or has as part of its business plan the
opening of the space frontier, and making a profit
doing so.”
– Rick Tumlinson, co-founder of Space Frontier Foundation
Commercial space?
Since the 1950s, the US government and aerospace
contractors have maintained that the aerospace and
defense industry operates on a commercial basis.
• US v European perspective
• Government contracting and infrastructure
investment
– Joanne Gabrynowicz, “One Half Century and Counting: The Evolution of US National Space
Law and Three Long-Term Emerging Issues” (2010) 4 Harv. L. & Pol’y 405, 423-424.
The era of commercialization
and privatization
Pre-NewSpace movements toward commercialization
and privatization:
• 1984 Commercial Space Launch Act
• 1984 Land Remote-Sensing Commercialization Act
• 1990s political pressure to break up national and
international communications monopolies and the
restructuring of Intelsat in early 2000s
• 1990s-2000s USAF Evolved Expendable Launch
Vehicle (EELV) program
– Joanne Gabrynowicz, “One Half Century and Counting: The Evolution of US National Space
Law and Three Long-Term Emerging Issues” (2010) 4 Harv. L. & Pol’y 405, 423-424.
The era of commercialization
and privatization
“It can be expected that this development toward
privatization and commercialization of space
applications will continue as demands grow and as
States and international organizations continue to
have less financial resources available for space
activities.”
– Karl -Heinz Böckstiegel, “Chair’s Introductory Remarks” (1997) 22(1) Annals of Air and Space
Law 399, 341
A nascent commercial
launch market
Globalization as driving a movement toward a free
launch trade environment:
• Restrictive bilateral launch agreements set to
expire;
• US-Russian cooperative ventures, including
Lockheed purchase of the RD-180 engine
– H. Peter van Fenema, “Recent Parallel Developments in Aviation and Space Launch
Regulation” (1997) 22(1) Annals A & S L 363, 365-367
The brakes on globalization
Strom Thurmond Act of 1999
• Transferred Commercial Communication Satellites
to USML
• Commercial satellite launch industry never
materialized.
– Ian F. Fergusson and Paul K. Kerr, “The U.S. Export Control System and the Presidents’ Reform
Initiative,” Congressional Research Service, Report R41916 (13 January 2014).
From commercialization to
commercial?
NASA has “bet the farm” on commercial companies.
– Scott Hubbard, “Why a NewSpace Journal?” (2013) 1(1) New Space 1, 2
• NASA’s CCtCAP Contest: Boeing US $4.2B; SpaceX
US $2.6B to ferry astronauts to ISS
• NASA’s CRS program: Orbital ATK and SpaceX
delivering cargo to ISS
In addition:
• SpaceX challenging ULA’s monopoly on EELV
program launches for US DoD
OldSpace v. NewSpace?
“In a new sort of space race, the [NASA cargo]
contract has touched off an intense competition
between stalwart defense contractors and new
space start-ups that have, in just a few years, shown
they can compete.”
–Christian Davenport, “A new space race emerges as NASA prepares to award contract to
ferry supplies to space station,” The Washington Post (9 March 2015).
Disruptive technologies?
“They don't spread things all over the country the way
that NASA and defense contractors tend to do.
They're very focused in two locations in the country.
They bring everything in-house. They have no
subcontractors, so everything comes to them. That's
disruptive.”
– NASA Administrator Charles Bolden, Statement to President's Council of Advisors on Science
and Technology, as reported by Frank Morning, Jr., “SpaceX Might Be Able to Teach NASA a
Lesson.” Aviation Week (23 May 2011).
A NewSpace industry
“[Orbital Sciences], which was founded in 1982, has
only a toe hold in the New Space industry.”
– “Actually, it is rocket science,” The Economist (8-14 Nov. 2014) at 72
• NewSpace as an evolving industry that any
company, new or old can exploit?
NewSpace challenging the
status quo?
NewSpace companies are those, “seeking to step outside the status
quo of governmental contracting which has been the norm for
commercial space actors to date.”
•
2010 US National Space Policy calls upon US gov to purchase
services, as opposed to hardware, from commercial providers
“This, of course, begs the question of whether these start-up
companies will rely on government contracts for their existence as
much as their predecessors have.”
–P.J. Blount, “Renovating Space: The Future of International Space Law,” (2011-12) 40 Denv J
Int’l L & Pol’y 515, 521
What’s so new, space?
“This New Space age is a time of change and
upheaval, when the capabilities once resident in just
two national space agencies morph and evolve into
a global pipeline of tech incubation stoked by the
efforts of some 70 national space organizations
around the globe.”
– Elliot Holokauahi Pulham, “The New Space Age” (2013) 1(1) NewSpace iii.
Public-Private Partnerships:
Bridging commercialization to commercial
PPPs & NewSpace models of government
involvement:
• Matching fund grants
• Government subsidization
• A focus on infrastructure
A focus on infrastructure
ISS: infrastructure funded and built by a coalition of
governments is enabling commercialization of LEO.
• Nanoracks
• Bigelow Aerospace
• Space Adventures, Ltd.
• Made In Space
Center for the Advancement of Science in Space (CASIS)
• Managing the US National Laboratory on ISS
• Enabling ZeroG R&D
State involvement within
the US
A variety of incentives:
• Matching fund grants
• Tax credits and exemptions
• Infrastructure investments
• Training and project assistance
• State-backed venture capital
• Limited liability and tort immunity
– FAA, “State Support for Commercial Space
Activities”
A NewSpace paradigm
“…an emerging global industry of private companies
and entrepreneurs who primarily target commercial
customers, are backed by risk capital seeking a return,
and profit from innovative products or
services developed in or for space.”
– “What is NewSpace?” NewSpace Global
From garage-based start-ups
to billion dollar corporations
Start-ups
• Nanoracks, Planet Labs, Skybox
Pushing the boundaries of NewSpace
• Red Bull Stratos – Space diving contest
• Paragon Space – manned capsule as a spacecraft
New business models
• Astrobotic – Rideshare/mission planning
• Made In Space – Space manufacturing
• Planetary Resources – Space mining
Business, Finance and Venture Capital
• Google & Fidelity US $1B investment in SpaceX
• Steve Jurvetson, DFJ – venture capital
• New Space Global – Market analyses and indices
• Space Angels Network - Network of companies and investors
A NewSpace era
A process of evolution from an era of commercialization
and privatization to an era of the commercial, driven by
entrepreneurial, private actors working within a spectrum
of government involvement.
Hallmarks of the the NewSpace era:
• New innovations in PPPs
• New licensing regimes
• New definition of assured access to space
• Private equity and finance
• Disruptive technologies challenging classic space actors
• Exploitation of niche markets (eg: smallsats, ZeroG R&D)
Thank you for your kind
attention!