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Kyle Smith

Connie Douglas

UWRT 1104-032

30 March 2017

Privatization of Space Industry

From the beginning of time, humans have explored distant frontiers to pursue the

unknown since this has always been in our spirit as a species. Space, the last known uncharted

boundary, has been recently argued whether who would be allowed to travel throughout its

depths. The National Aeronautics and Space Administration (NASA) has had a rough time

substantially prospering through expensive failed missions and programs. Thus, began to lead the

businesses future funding in a new direction. Privatization has been the savior for this industry

since 1962 because NASA began to collaborate with businesses under contracts. Certain

companies including SpaceX and Boeing, are manufacturing aircraft products for NASA and

other large corporations bound to the United States government. Overall, NASA and these two

companies have been debating throughout the past few years as to who can do what for the space

program and virtually be the ones to try to travel there. Since NASA, Boeing, and SpaceX are

currently the leaders in the flight industry, their partnerships and deal constructing marked the

real start to the commercialization and privatization of this business.

Representing the United States in the space race since 1958, NASA has led the way for

exploration, innovation, and discovery in this field. Developing satellites and sending probes out

while studying the science behind their missions are just a few things this company is

responsible for. Funded directly from the government until 1962, the start of privatization began

when two companies began creating satellites to increase their communication capabilities
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(Scarborough 2). With the rise of failing programs and expensive products, the government had

to force NASA to open its door to private investors. The process of privatization has overall been

beneficial towards NASA so far because large profits are being made using contracts and deals

with these lower companies and entrepreneurs, instead of strictly from the government. Alan

Lindenmoyer, a member of NASAs Commercial Crew and Cargo Program stated, To stimulate

the commercial space transportation industry, NASA is facilitating the demonstration of

Commercial Orbital Transportation Services (COTS) to Low Earth Orbit (LEO) by private-sector

companies. In 2006, NASA entered funded agreements with two such companies Space

Exploration Technologies (SpaceX) and Rocketplane Kistler (RpK), each of which proposed to

obtain the additional private financing needed to complete its flight demonstrations.

(Lindenmoyer) Lindenmoyers argument showed that NASAs commercial side to their business

is growing because they know the changing market is forcing transformation of their current

infrastructure. Carlyle Webb, an editor for NASA, also stated, ..purpose of the non-reimbursable

Space Act Agreements is to advance commercial space-related efforts by facilitating access to

NASAs vast spaceflight resources including technical expertise, assessments, lessons learned,

and data (Webb) Webb shows how NASA has turned to signing agreements to share vast

resources and information that will benefit both parties. Working together is a whole lot easier

than trying to solve their problems of exploration and creation on their own. Overall, NASA has

welcomed the idea of privatization since they can accomplish more while lowering costs and

wasted funding. The main priority for them is to keep the International Space Station alive, while

private companies must fund missions to keep resupply missions going.

SpaceX, an aerospace manufacturer based out of California has recently been involved

commercializing this business since its creation in 2002. Innovating existing transportation and
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communication equipment, this company has a large impact on the products and people working

in the air sector. With missions paid for by common citizens to travel the International Space

Station, they plan to satisfy a growing market of people who want to go to and from here.

Located on the SpaceX website, an entry states, Under a 1.6 billion dollar contract with

NASASpaceX continues to work toward one of its key goalsdeveloping reusable rockets, a

feat that will transform space exploration by delivering highly reliable vehicles at radically

reduced costs. (SpaceX) With the rise of pollution and depletion of natural resources, this

company knows they must reuse products and find the cheapest way possible of doing things to

satisfy the changing space marketplace. A large name in the flight industry, SpaceX felt the best

way to help save the space program was to collaborate with it and help them accomplish things

working together. Elon Musk, CEO, stated in the article SpaceX to send two people around the

moon who paid for a 2018 private mission, that passengers have already paid a significant

deposit to do a moon mission and called the cost comparable to to that of sending astronauts

to the International Space Station. Nasa currently pays Russias space agency, Roscosmos, about

70m a person to fly astronauts to the ISS. (Yuhas) If this corporation can rely on private

investors and citizens to pay for missions, this will help NASA get back on track instead of

relying on Russia or the taxpayers money. It will not be long now before more people pay

money for missions, their concern is developing the correct technology and equipment to make

sure they make it there safe. They see the large profits to be made in this industry because

virtually everyone around the world would like to go into space at some point in their life.

A multinational spacecraft agency giant, Boeing, creates and sells all kinds of technology

and products for the flight industry. Founded in 1916, their equipment has been used in every

war and major event occurring in the air or space up until now. Also, the creators of the site
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Space Launch, which is the first privatized site created was a major milestone in the space race.

Pairing with NASA and SpaceX, it was their goal to save the US space industry before it lost all

funding and accountability. John McLuckey, executive vice president of Boeing Defense &

Space Group, stated, We have formed a very strong team with expertise in developing and

operating complex systems for commercial as well as government customersWe intend to

develop a superior operations architecture that will reduce costs while maintaining safe and

robust space operations into the 21st century." (Boeing) Opening the market to the public allows

this company to sell products to both the government and any business that is participating in this

field. McLuckey is very confident in his team and its infrastructure to accomplish the task of

developing safe and cheap products for the future missions. Many of their deals would never

have been made if they did not start making space related resources after the privatization began.

Dennis Muilenburg, CEO, said hes convinced the first person to step foot on Mars will arrive

there riding a Boeing rocket. (Boeing) This quote is so powerful because Dennis wants his

company at the front of this exploration and be responsible for providing them with the correct

equipment to make it possible. Justin McFatter, a dynamics and control engineer at Boeing, also

stated The docking system is a great example where talented people from around the company

were able to work as a team to meet a critical need for the future of space exploration, (Cosmic)

after just inspecting a newly developed docking ship. Not only does this innovating create jobs,

but it lets the company grow and become more influential on many markets. Working in the

space industry is a tough process since developers must create products at good prices and sell to

a large range of investors around the world.

In conclusion, these three companies are in favor of the privatization of the industry after

realizing how beneficial it would be to become partners. Working together rather than alone in
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the space program not only cuts down costs, but it leads to greater discoveries and innovations as

many groups work towards common goals. The space industry was a dying business until this

idea of commercialization came along, opening its doors to the public and essentially the

everyday person. NASA used to be funded strictly from the government, but they soon realized

with the changing markets and failed missions, it was time to change. The only way for them to

stay alive was to accept this phase and join these other businesses under contracts. SpaceX

formed off this idea happening, for Elon Musk saw the vision of exploring and began creation.

They know they had to step in to help NASA before it was lost for good. Overall, this company

fully supports the privatization because they benefit largely from the people and the smaller

businesses trying to contribute to this industry. Boeing, a large name in the flight industry, sells

and creates a lot of products for this field. The privatization opened the door to them creating

deals and signing partnerships with others to achieve more overall and increase their profits.

While Boeing and SpaceX could still be around without the privatization occurring, NASA

would be a little more different. Low funding and very few missions would occur if the money

was still strictly coming from the government in our current economy. These companies know

that our nation must always have a space program, and the idea of privatization and collaborating

with NASA was how it would be kept going.

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Sources

"Cosmic connection." Cosmic Connection. N.p., n.d. Web. 30 Mar. 2017.

Easterbrook, Gregg. "Long Shot." Atlantic 291.4 (2003): 64. Points of View Reference Center.

Web. 14 Feb. 2017.

Ernest, Van C. "Third Party Liability Of The Private Space Industry: To Pay What No One Has

Paid Before." Case Western Reserve Law Review 41.2 (1991): 503. Academic Search

Complete. Web. 15 Feb. 2017

Etherington, Darrell. "A new private space race as Boeing CEO says hell beat SpaceX

to Mars." TechCrunch. TechCrunch, 05 Oct. 2016. Web. 30 Mar. 2017.

Lindenmoyer, Alan and Dennis Stone. "Status of NASA's Commercial Cargo and Crew

Transportation Initiative." Acta Astronautica, vol. 66, no. 5/6, Mar. 2010, pp. 788-791.

EBSCOhost, doi:10.1016/j.actaastro.2009.08.031.

"News Releases/Statements." MediaRoom. N.p., n.d. Web. 29 Mar. 2017.

Scarborough, Jack W., and Richard F. Poist. "Commercial Space Transportation: An Appraisal Of

The Federal Role In A Modal Genesis." Transportation Journal (American Society Of

Transportation & Logistics Inc) 29.3 (1990): 36-46. Academic Search Complete. Web. 15

Feb. 2017.

Spacexcmsadmin. "Company." SpaceX. SpaceX, 27 Nov. 2012. Web. 27 Mar. 2017.

Webb, Carlyle. "Collaborations for Commercial Space Capabilities (CCSC)." NASA. NASA, 15

June 2015. Web. 26 Mar. 2017.

Yuhas, Alan. "SpaceX to send two people around the moon who paid for a 2018 private

mission." The Guardian. Guardian News and Media, 28 Feb. 2017. Web. 27 Mar. 2017.
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