Space, Commercialization of

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Space, Commercialization of

Since the space program began in the early 1960s, there has been talk of the possible commercial exploitation of space. One of the earliest satellites launched into space was the giant metallic Mylar balloon called "Echo." Radio signals were reflected from the satellite in an early test of satellite communications. By the early part of the twenty-first century, the space around Earth was filled with commercial communications satellites. Television, radio, telephone, data transfer, and many other forms of information pass through these satellite systems. Excluding the use of two cans and a piece of string, it would be hard to find any form of information transfer that does not involve satellites.

In the early days of space exploration, many people thought that the apparent weightlessness in orbiting satellites would allow for types of manufacturing that would not be possible in a normal gravity environment. However, improved processing techniques in Earth-based facilities have proven to be more economical than space-based facilities. Manufacturing remains an underdeveloped form of space commercialization.

Nonetheless, commercial exploitation of space remains a real possibility. In recent years, several small companies have been formed. Former astronauts or former National Aeronautics and Space Administration (NASA) scientists or engineers lead many of these small companies. These people believe that the commercial exploitation of space has economic potential. Whatever their goals as a company, they are all convinced that a profit can be made in space.

Space Stations

In 1975, participants in an Ames Research Center (a part of NASA) summer workshop created the design for what they considered to be a commercially viable space station. The space station was to be a toroidal structure (like a wheel) 2 kilometers (km) in diameter, and it was supposed to be built in orbit at the same distance as the Moon.

The group selected either the L4 or L5 lunar Lagrange points as the planned station's orbital position. These are points in space 60° ahead of or behind the Moon in orbit. These points were chosen because they are gravitationally stable and objects placed at one of these two points tend to stay in position. The station would be large enough to hold 10,000 colonists, who would live and work in a habitat that formed the rim of the wheel. At one revolution per minute, centrifugal acceleration at the rim would equal9.8 m/s2, which would simulate Earth's gravity. Engineers thought that the colonists could breathe oxygen extracted from moon rocks. The habitat tube would include 63 hectares of farmland, enough to grow food to feed the colonists. The team calculated that the colony would cost $200 billion, which would be equivalent to $500 billion in 2001. The engineers predicted this enormous cost could be recovered within 30 years in savings achieved by having the colonists assemble solar-powered satellites in orbit.

This was an ambitious, even grandiose plan. Current space station plans are much more modest by comparison. The International Space Station holds seven crew members and generates negligible income. It will never generate enough income to cover its $60-billion construction cost. NASA is still trying to form alliances with companies interested in using the space station's microgravity environment for commercial purposes such as renting research modules on the space station to pharmaceutical, biotechnology, or electronics companies. Thus far, private companies have shown little interest.

In contrast to other forms of space commercialization, the satellite communications business is booming and shows no signs of slowing down. The strong demand for cellular telephone service and satellite television broadcasts keeps that part of the space industry commercially successful. In all, space-related businesses accounted for over $121 billion per year in 1998.

The International Space Station is expected to grow to a mass of over 500,000 kilograms by 2004. As of 2001, all items are shipped from Earth, with space-based operations limited to assembly. This is obviously a major constraint in mission planning. Demand for space-based construction is projected to cost $20 billion per year in 2005, rising to $500 billion per year by 2020 as human space exploration progresses. This cost is primarily due to the high cost of launching payloads from Earth's surface.

Low-Cost Launch Vehicles

One major obstacle to commercially successful space manufacturing is the enormous cost of launching a vehicle into Earth orbit. Launch costs using either expendable rockets or the Space Shuttle are currently between $10,000 and $20,000 per kilogram. This high cost led NASA to invest in a prototype launch vehicle called the "X-33." It was hoped that this prototype would lead to a lightweight, fully reusable space plane. Lockheed Martin was building the prototype and originally planned to follow it with a commercial vehicle called the "Venture Star." However, NASA withdrew funding for the project, leaving it 75 percent complete. Instead NASA created a new program, the Space Launch Initiative, to continue research and development of reusable launch vehicles.

Space-Based Manufacturing

While the communications and weather satellite business is profitable, the space industry may need to diversify. For many years, NASA has tried to interest private companies in space-based manufacturing, with the idea that medicines involving large protein molecules, certain types of ultra-pure semiconductor materials, and other products could be manufactured with better quality in an orbital station with near-zero gravity. However, many experts now believe that space-based manufacturing will never be profitable, even if cheaper launch vehicles become available.

In-orbit assembly of solar-powered satellitesthe main purpose of the giant space colony conceived in 1975seems to offer more hope of profitability, especially with the anticipated growth in global energy consumption. A solar collector in geostationary orbit would be in full sunlight all the time, except when Earth is near the equinox points in its orbit. It would also be above the atmosphere, so it would receive about 8 times as much light as a solar collector on the ground. Engineers have calculated that a dish 10 kilometers in diameter could generate about 5 billion watts of power, 5 times the output of a conventional power plant. The power could be transmitted by microwave beams from the satellites to antenna arrays on Earth that would convert the microwave energy directly into electrical energy with high efficiency. By using a large antenna array, the microwaves can be kept at a safe intensity level. The array could be mounted several meters off of the ground. The space underneath would receive about 50 percent of normal sunlight, so it could be used to grow shade-tolerant crops.

While promising, solar power is a long way from reality. In 1997, NASA completed a study that reexamined the costs of solar-powered satellites. NASA's conclusion was that solar power could be made profitable only if launch costs drop below $400 per kilogram, a fraction of the current $10,000 to $20,000 per kilogram launch costs. This seems like an impossible cost reduction, but new technologies are always expensive before their costs rapidly decrease with the innovations brought forth by healthy competition.

Space Tourism

Until solar power or some other form of space manufacturing becomes more practical, the most likely source of income might be tourism. Former Apollo astronaut Edwin "Buzz" Aldrin, Jr., the second man to walk on the Moon, has formed a private foundation, the Share Space Foundation, to promote space tourism. "People have come up to me and asked, 'When do we get a chance to go?'" Aldrin says. A 1997 survey of 1,500 Americans showed that 42 percent were interested in flying on a space cruise. Space tourism was encouraged by a 1998 NASA study that concluded it could grow into a $10-billion-a-year industry in a few decades.

The First Space Tourist. Space tourism became a reality in 2001, at least for one wealthy individual. Dennis Tito, an investment banker from California, originally paid an estimated $20 million to the Russian Space Agency, RKK Energia, for the privilege of being transported to the Russian Space Station Mir. However, before that event could take place, the aging Mir was allowed to burn up in the atmosphere. Tito subsequently made arrangements with the Russian Space Agency to be transported to the International Space Station (ISS) as a passenger on a Russian Soyuz flight. The other agencies operating the International Space Station originally objected strongly, but when it became apparent that Russia was going to fly Tito to the Space Station in spite of their objections, they reluctantly agreed to allow him to board. On April 30, 2001, Tito officially became the world's first space tourist when he boarded the International Space Station Alpha.

Tito was required to sign liability releases and to agree to pay for anything he damaged while on board. NASA argued that the presence of Tito on the space station, which was not designed to receive paying guests, would hamper scientific work. The schedule of activities on board the ISS was curtailed during Tito's visit to allow for possible disruption. In spite of these difficulties, NASA and the other agencies operating the space station anticipate further requests from paying tourists.

Mining in Space

Many space entrepreneurs are also considering the possibility of mining minerals and valuable ores from Earth's Moon and the asteroid belt. There are strong hints from radar data that there may be ice caps at the lunar poles in deep craters that never receive sunlight. This discovery has raised the possibility of a partially self-sustaining Moon colony. However, the most promising commercial possibilities for mining in space may come from near-Earth asteroids (NEAs). These are asteroids that intersect Earth's orbit. Many of these asteroids are easier to reach than the Moon. Certain kinds of asteroids are rich in iron, nickel, cobalt and platinum-group metals. A two-kilometer wide asteroid of the correct kind holds more ore than has been mined since the beginning of civilization.

It would be difficult, impractical, expensive, and dangerous to transport this ore to Earth's surface. Thus, asteroid ores would be processed in space, and the metals used to build satellites, spaceships, hotels, and solar power satellites. Surprisingly, the most valuable resource to be mined from the asteroids might turn out to be water. This water could be supplied to the space hotels and other satellites, or solar energy could be used to break down the water into hydrogen and oxygen that could then be used as rocket fuel. Since all of the materials are already in orbit, rockets built in space and launched using fuel from water would cost much less than rockets launched from Earth.

Space Dev is a publicly-held commercial space exploration and development company that already has plans in the works for asteroid prospecting. The company has plans to send a spacecraft known as the "Near Earth Asteroid Prospector" (NEAP) to the asteroid 4660 Nereus by 2002. NEAP will cost about $50 million, but this is inexpensive compared to other spacecraft. If this mission is successful, it will be the first commercial deep-space mission. NEAP will carry several scientific instruments, and SpaceDev hopes to make a profit by selling the data collected by these instruments to other entrepreneurs, governments, and university researchers. SpaceDev also hopes to carry other scientific instruments. The company currently offers space for one ejectable payload for $9 million, and three custom nonejectable payloads for $10 million each. NASA classified NEAP as a Mission of Opportunity, which means that research groups can compete for NASA funds to place scientific instruments onboard the spacecraft.

The Space Enterprise Zone

If any of the companies interested in the commercial exploitation of space are going to make a profit, they must avoid having to compete with NASA. Several companies and interest groups, such as the Space Frontier Foundation, have proposed that NASA turn over all low-orbit space endeavors to private companies. This would include the Space Shuttle and the International Space Station. NASA, they feel, should concentrate on deep space exploration. Rick Tumlinson, the president of the Space Frontier Foundation, says "NASA astronauts shouldn't be driving the space trucks, they should be going to Mars!"

NASA is also studying how to transfer technology to private industry. This has been a goal of NASA from its very beginning. In 1998 Congress passed the Commercial Space Act, which requires that NASA draft a plan for the privatization of the space shuttle. The law also established a regulatory framework for licensing the next generation of reusable launch vehicles.

To encourage even more privatization of space, several space entrepreneurs have proposed that Congress create a space enterprise zone similar to the enterprise zones in many inner cities. Companies beginning new space-related businesses, such as building reusable launch vehicles, would not be taxed for several years.

In spite of the obvious problems, most people in the space industry remain optimistic. As a group, they are convinced that the commercial exploitation of space will eventually become profitable, and that commercial operations will be established in Earth orbit, on the Moon, in the asteroid belt and on other planets. For years, science fiction writers and established scientists have looked far ahead and predicted such extraordinary ideas as transforming Mars into a habitable planet. There is even a word invented to describe this process, "terraforming." The number of space entrepreneurs may remain small, but they share a vision that commercial exploits like terraforming Mars are possible and even necessary if we are to survive as a species.

see also Space Exploration; Spaceflight, History of; Space-flight, Mathematics of.

Elliot Richmond


Chaisson, Eric, and Steve McMillan. Astronomy Today, 3rd ed. Upper Saddle River, NJ: Prentice Hall, 1993.

Criswell, D., and P. Harris. "An Alternative Solar Energy Source." Earth Space Review, 2 (1993): 1115.

Giancoli, Douglas C. Physics, 3rd ed. Englewood Cliffs, NJ: Prentice Hall, 1991.

Strangway, D. "Moon and Asteroid Mines Will Supply Raw Material for Space Exploitation." Canadian Mining Journal, 100 (1979): 4452.

Internet Resources

Buzz Aldrin. <>.

Space Dev. "The World's First Commercial Space Exploration and Development Company." <>.

Space Frontier Foundation Online. <>.