In the space industry, who is a contractor and who is commercial?by Taylor Dinerman
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| One cannot go down to the corner store and buy a couple of pounds of comsat or go on line and order a ticket to low Earth orbit or beyond. |
It’s fairly easy to identify a contractor: they are the ones with the big cost-plus or fixed price contracts, the listings on Wall Street, and the very expensive and very professional public and congressional relations organizations. They have the legal and accounting staff to deal with the tons—literally tons as measured in the sheer weight of paper—of federal procurement regulations.
The programs they manage and the hardware they build are essential to national defense and civil space operations. Their programs often suffer from massive cost overruns and decade-long delays. These problems are rarely the direct fault of these large firms, but are built into the system. In any case, the contractors represent the bulk of the space industry.
These are the firms that built the first US space launch vehicles, the Saturn V, the Shuttle, the Lunar Module, and the International Space Station (ISS). Today they build the most of the commercial and military spacecraft made in America. From a business standpoint they are in reasonably good shape compared to other large US manufacturing corporations. Of course, they face unprecedented levels of international competition, but that is only to be expected. In the wider scheme of things they should be able to look after themselves.
What these big firms are not is “commercial”. One cannot go down to the corner store and buy a couple of pounds of comsat or go on line and order a ticket to low Earth orbit or beyond. Everything they sell is, as the British say, “bespoke”: made to measure, and thus the customer had better know what he or she is doing or they will end up with an expensive, useless piece of junk.
Commercial firms, on the other hand, sell consumer products and services to individuals, companies, and governments. When one buys a seat on an airliner, one knows that the same seat has been sold to the person who is flying on government business or on a family vacation. The configuration and design of the cushions does not change because it is sat on by a senator or a salesman.
NASA’s Commercial Resupply Services (CRS) program is a transaction closer to the definition of “commercial” than any other major project in NASA history. While there is still some resistance to the idea within the agency, most senior officials recognize the importance of its success. In the near term the SpaceX Falcon 9 and its Dragon capsule will play a critical role in keeping America’s investment in the ISS viable. Without it, and eventually without Orbital Sciences Taurus 2 and Cygnus combination, the US will have to face up to its diminished influence over the partnership.
The most critical and problematic aspect of CRS is going to be the delivery of crew to the ISS. Can this be done safely and relatively cheaply? Once the Shuttle is grounded for good, Russia is going to make full use of its monopoly on human spaceflight, so we should expect NASA to be charged far more than the approximately $50 million for a seat on the Soyuz it now pays. Will SpaceX be ready in time to make a difference?
Those in Congress who are hostile to the idea of commercial human spaceflight should think about the ramifications of this Russian monopoly. This does not mean, though, that their concerns are entirely unfounded. When we buy seats on an airliner we know that the aircraft has gone through a rigorous testing and certification process based on more than seven decades of experience with commercial aviation. While no one can reasonably expect that flying into orbit will be as safe as flying from New York to Paris, safety concerns are legitimate.
There has been a semi-theological debate inside the space industry as to the meaning of the term “human rated”. The implication has always been that launching people requires a different and more demanding set of standards than, say, launching a billion-dollar spy satellite. It’s time to get beyond this dead-end argument. The standard for a CRS crew vehicle should be simple: make it as safe as humanly possible. As long as the companies involved understand clearly that they will be held accountable, this should be enough.
| There are many members of Congress who see the commercial space concept as being a rival to the Constellation program. In theory this in false, but in the real world of political and budgetary bargaining and decision-making it is a sad fact of life. |
But will the process truly be a commercial one? Both firms involved in CRS have received generous funding from NASA before they have delivered a single ounce of payload. In this respect they are more like a traditional contractor than like an airline. However, they have also spent very large sums of their own funds on the program and on manned capsules that they plan to use both to deliver crew to the ISS and to other destinations in LEO, such as Bigelow’s planned facility.
In both cases these firms are hybrids. This is especially true for Orbital, which is in some respects a normal contractor and in others acts more like a NewSpace company. SpaceX, on the other hand, is a fairly typical successful NewSpace operation, bankrolled mostly by Elon Musk’s personal fortune. Orbital’s track record of putting payloads into orbit is far more impressive than SpaceX’s, but their cost structure resembles that of a normal large contractor and the prices they charge reflect this. SpaceX has—so far—kept its operation lean and agile, so their chances of building a true low cost system must still be rated as pretty good.
There are many members of Congress who see the commercial space concept as being a rival to the Constellation program. In theory this in false, but in the real world of political and budgetary bargaining and decision-making it is a sad fact of life. Whatever choice the president makes, NASA will have to sell it to a Congress that is all too aware of the stakes involved. The loss of jobs in Florida, Mississippi, Texas, and California that will follow from a downgrading of the exploration program will be extremely painful. Commercial space operations, no matter how cost effective and sensible, will have to be sold to Congress in an atmosphere that will be less than friendly.