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Review: International Space Commerce

International Space Commerce: Building from Scratch
by Roger Handberg
University Press of Florida, 2006
hardcover, 284 pp.
ISBN 0-8130-2984-8

Earlier this month, NASA’s announcement of awards to two companies for its commercial ISS resupply program, COTS, attracted considerable media attention. While most of the coverage had a neutral or even positive tone, an AP account of the announcement played up the fact that the two companies selected by NASA, Rocketplane Kistler and SpaceX, were “both recovering from different failures”, namely, Kistler Aerospace’s Chapter 11 bankruptcy protection filing and the failure of the initial launch of the SpaceX Falcon 1. As a headline used by one newspaper running the AP article put it, “2 ailing firms get NASA business”.

While Rocketplane Kistler and SpaceX might take issue with the claim that they are “ailing firms”, the relatively brief history of commercial space ventures is rife with companies that did indeed fail, from satellite communications companies like Teledesic to any number of launch vehicle startups in the 1980s and 1990s. In addition, the US government, through NASA and other agencies, have played a critical—although not always positive—role in the development of commercial space companies that long predates COTS. In International Space Commerce, Roger Handberg examines the historic interplay between the public and private sectors, among other related issues, in the effort to develop a commercial space industry.

The central tenet of Handberg’s book is that there is a three-way “essential tension” in space commerce, pitting politics versus economics versus technology. While in most high technology industries politics would play a tertiary role, if any, compared to the other two, Handberg posits that politics is the most powerful factor of the three, followed by economics and technology. That influence is predictably rooted in the Cold War origins of space programs in the United States and former Soviet Union, but continues today both in the form of financial support for commercial or pseudo-commercial space endeavors (such as the EELV program) as well as regulatory issues, like export control and “shutter control” over commercial imaging satellites.

“Some, usually newer but smaller space players, call for the removal of the government from the field,” writes Handberg, “while others, usually the more established players, wait expectantly for future government subsidies and directions.”

Handberg spends much of the book evaluating the major commercial space markets: transportation, communications, navigation, and remote sensing. From these sections a general theme emerges. The US, being the first market economy to develop spacefaring capability, initially had a monopoly in space commerce, forcing other countries that wanted to be involved—like, for example, to have their own communications satellites—to work with the US. That monopoly has eroded over time, as other countries, most notable the nations of Western Europe, worked to develop their own independent capabilities that could serve commercial ends, but were primarily a way to get around what had been a de facto American veto of their own proposals. The development of the Ariane launch vehicle is the best-known example of this, but Handberg discusses several other related developments including, most recently, Europe’s decision to develop its own satellite navigation system, Galileo.

At one point in the book, Handberg elegantly describes the varying perceptions of the role of government in this field among emerging and established companies: “Some, usually newer but smaller space players, call for the removal of the government from the field, while others, usually the more established players, wait expectantly for future government subsidies and directions… This pattern feeds the general sense that nothing can happen without government subsidy or leadership, preferably both but especially the former.”

Handberg provides a detailed analysis of space commerce as it developed and stands today. However, one problem with the book is that people who are deeply familiar with space commerce will find that Handberg, a professor of political science at the University of Central Florida, doesn’t appear to be as knowledgeable. That shows in a number of ways, such as a few misspelled names (“Bert Rutan”, “Chesley Bonesteel”) and some sloppy editing (in one paragraph he compares the top speed of SpaceShipOne with the much higher speed needed to achieve orbit, then makes the same comparison later in the same paragraph.) Handberg also states that the “number of LEO and MEO comsats is projected to grow”, yet there are few, if any, such systems under development or even consideration today, given the expensive failures of earlier generations of such systems. The most bizarre statement, though, comes near the end of the book, where Handberg writes, “For example, one satellite, Orion 3, was flown around the moon in 1992 to adjust its orbit for commercial use for another ten years. A space shuttle crew attached an engine to the satellite for its circumlunar voyage.” Of course, no such shuttle mission to send a stranded satellite on a circumlunar mission took place; checking the references Handberg cites, it appears he conflated several actual and proposed satellite rescue efforts, including the shuttle rescue of an Intelsat satellite, a proposed shuttle rescue of Orion 3, and the actual salvage of AsiaSat 3 through lunar flybys, without the involvement of the shuttle.

Those faults aside, Handberg does, in general, provide good insights into how politics has intertwined with economics and technology in shaping (or misshaping, as the case may be) space commerce. He believes that while policy will continue to play a role in this field, “space commerce decisions are increasingly less likely to be driven by the desire for national prestige or power.” The COTS program may be an example of that: while NASA is providing financial support for the winning companies, those firms also must raise money on their own and carry out a business plan that includes markets beyond ISS resupply. Whether the role of politics in the “essential tension” of space commerce does lessen over time may turn out to be one of the key factors in the long-term commercial success of the industry as a whole.