Building a Commercial Market in Low Earth Orbit

By Tom Kalil and Dr. Dava Newman

“By buying the services of space transportation – rather than the vehicles themselves – we can continue to ensure rigorous safety standards are met. But we will also accelerate the pace of innovations as companies – from young startups to established leaders – compete to design and build and launch new means of carrying people and materials out of our atmosphere.”

President Barack Obama
Kennedy Space Center
Cape Canaveral, Florida
April 15, 2010

This April marked the sixth anniversary of President Obama’s landmark address on space policy at NASA’s Kennedy Space Center in Florida. In his speech, the President set out the goal of sending American astronauts to Mars in the 2030s, using a strategy that encourages innovation and entrepreneurship in space exploration through investments in new space technologies and partnerships with the private sector as well as academia and other non-traditional partners.

Six years later, we have made great progress toward our goals, and the commercial space industry is expanding rapidly. The United States is closer to sending human beings to Mars than anyone, anywhere, at any time has ever been. In the next decade, NASA’s human space exploration program will shift its focus from operations in low-Earth orbit (LEO) to moving out in to Earth–Moon orbits, namely, cislunar and deep space, where astronauts are days, or weeks, away from Earth. Deep space exploration is the proving ground where NASA will prepare by flight testing technologies necessary for the immense challenge of sending astronauts to Mars and back in the 2030s.

As NASA moves in to cislunar orbits, its commercial partners will need to take the lead in low-Earth orbit by building a space economy based not solely on government contracts, but on private sector supply and demand. NASA’s commercial cargo program has reinvigorated the American launch industry by helping Orbital ATK and SpaceX develop the Cygnus and Dragon capsules to supply cargo to the International Space Station (ISS). NASA recently added a third US company, the Sierra Nevada Corporation, for ISS cargo resupply missions through 2024. Boeing and SpaceX are under contract to transport astronauts to the station within the next two years through NASA’s Commercial Crew Program.  For these vehicles to be economically successful in the long run, however, they will need to have private sector customers willing to pay to transport people and cargo to LEO.

Today, NASA is releasing Economic Development of Low Earth Orbit, a new collection of papers, written by prominent economists, that explores the question of how the private sector can take advantage of government investments in LEO.  As the NASA collection’s editors, Dr. Patrick Besha and Dr. Alexander MacDonald, explain, “after the government pioneers, develops, and demonstrates a space capability—from rockets to space-based communications to Earth observation satellites—the private sector realizes its market potential and continues innovating. As new companies establish a presence, the government often withdraws from the market or becomes one of many customers.”

We are currently at the threshold of this sort of opportunity when it comes to low-Earth orbit. We hope to advance the important conversation about the opportunities and challenges ahead of us; opportunities that can have a real impact for the exploration of space, and challenges that we will need to work together to overcome. We hope that through these discussions we will increase our ability to further expand economic opportunity and growth to more Americans and more American businesses.

NASA’s current partnerships with commercial cargo and crew providers are already putting Americans to work at more than a thousand companies across nearly all fifty states. With the recent, successful SpaceX and Orbital ATK resupply missions, our commercial partners have now delivered 24,874 kilos (54,837 pounds) of cargo to the International Space Station (ISS). Astronauts on the ISS recently expanded an experimental habitat, the Bigelow Expandable Activity Module (BEAM), which was delivered on the most recent cargo resupply mission. Members of the crew also entered the module for the first time. Over the next two years, testing of the BEAM and the capability of expandable habitats could lead to future development of commercial habitation systems.   Commercial cargo missions have also included hundreds of experiments that utilize the unique microgravity environment on the ISS, such as a biomedical experiment from Eli Lilly and the first space-based 3D additive manufacturing facility, developed by Made-in-Space.  ISS National Lab manager CASIS continues to provide vital support for these and other commercial initiatives.

NASA’s mission is to explore and reach new heights for the benefit of all humankind. In transitioning LEO to commercial partners, we have an opportunity to do just that: expand economic opportunity for American business and hard-working families, while advancing new technologies, research and discoveries that benefit the entire human family.

Although the focus of the collection of papers being released today is on the potential for economic development in low-Earth orbit, commercial and international partnerships are also an important part of NASA’s Journey to Mars – and we encourage you to learn more about NASA’s plan here. At NASA, we are in the business of turning the impossible in to reality and raising the bar of human potential.

Dr. Dava Newman is deputy administrator of NASA. Tom Kalil is deputy director for policy for the White House Office of Science and Technology Policy.