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Space Businesses

What It Took For SpaceX To Become a Serious Space Company 96

An anonymous reader writes: The Atlantic has a nice profile of SpaceX's rise to prominence — how a private startup managed to successfully compete with industry giants like Boeing in just a decade of existence. "Regardless of its inspirations, the company was forced to adopt a prosaic initial goal: Make a rocket at least 10 times cheaper than is possible today. Until it can do that, neither flowers nor people can go to Mars with any economy. With rocket technology, Musk has said, "you're really left with one key parameter against which technology improvements must be judged, and that's cost." SpaceX currently charges $61.2 million per launch. Its cost-per-kilogram of cargo to low-earth orbit, $4,653, is far less than the $14,000 to $39,000 offered by its chief American competitor, the United Launch Alliance. Other providers often charge $250 to $400 million per launch; NASA pays Russia $70 million per astronaut to hitch a ride on its three-person Soyuz spacecraft. SpaceX's costs are still nowhere near low enough to change the economics of space as Musk and his investors envision, but they have a plan to do so (of which more later)."
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What It Took For SpaceX To Become a Serious Space Company

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  • To compete in price (Score:5, Interesting)

    by Thanshin ( 1188877 ) on Wednesday October 22, 2014 @11:10AM (#48204279)

    To compete in price against anyone you only need money. With enough money, you can set a price of $0.

    The main question is "will they be able to recover the cost of that competence once they get the contracts?" and it's way too soon to know the answer to that.

    It's like judging the acquisition of online "businesses". Nobody can prove the price was or wasn't right until the buyer makes that back as profit or doesn't.

    • by Ken_g6 ( 775014 )

      No, to compete in price against anyone you only need assets. That can be money, or it can be tangible assets, such as rocket parts that remain in serviceable condition after a launch. Probably no one here will like it, but under current law, even "intellectual property" counts as an asset.

  • find a battery charging station on Mars.

    • by Ken_g6 ( 775014 )

      I'm sure the solar panels from defunct rovers could provide at least a trickle charge.

      And he can put a better charging station there later.

  • by bkr1_2k ( 237627 ) on Wednesday October 22, 2014 @11:19AM (#48204387)

    It took a ton of money and the vision of a leader looking more than 3 years into the future. Anyone with enough money and willingness to throw that money at a "problem" will be able to compete.

    • Anyone with enough money and willingness to throw that money at a "problem" will be able to compete.

      Just because you throw lots of money at a problem doesn't mean you'll ever make a profit. If you cannot make a profit you will eventually go out of business. A bottomless (or effectively so) checkbook isn't necessarily enough. For example Microsoft may never make back all the money they invested in trying to make the Xbox competitive. Sure they "competed" but it was a Pyrrhic victory at best.

      • by bkr1_2k ( 237627 )

        Has anyone indicated that SpaceX is making a profit yet? From the article it wasn't obvious that they are now or in the next couple of years.

    • by k6mfw ( 1182893 )
      I asked someone that follows commercial space (he also invested some money into xcor) of how SpaceX, SNC, Scaled Composites, etc. have done something that should have been done decades ago. His reply was this is result of wealth inequality which a few billionaires can spend lots of money on something very dubious of making any profit. Reminded me what Donald Douglas (I think) answered how does one make a million dollars in airplane business, "start with 10 million" or some answer like that. Now there is all
  • SpaceX's costs are still nowhere near low enough to change the economics of space as Musk and his investors envision, but they have a plan to do so (of which more later).

    Long extension cord?

  • When SpaceX is launching prefabbed Bigelow habs every day, THEN their a serious space industry. When the alignment of mass production finally hits the space age and we're launching more habs than we can fill with people...
    • by rasmusbr ( 2186518 ) on Wednesday October 22, 2014 @12:15PM (#48204933)

      Nonsense. It's all vaporware until they at the very least have a reasonably dense Dyson sphere around the solar system.

    • Considering no one has ever done that, are you saying the last half century of spaceflight has just been amateur hour?
    • by dpilot ( 134227 )

      By that definition, nobody has a serious space industry, not even the government players.

      Actually I think I might almost agree with you, but that's not a ding against SpaceX, it's a ding against our species.

      I don't agree about launching more habs that we can fill with people - I'd just like to see enough SOMETHING launched to make opportunities. I'd also like to see a second basket to keep some of our species eggs in.

      • yeah, I was "mostly" sarcastic. Honestly, Elon is doing an amazing job. And seeing pics of the line of in-production Dragon capsules, rockets, etc...what he's doing now is just the very beginning. One pic had at least 10 capsules in different build stages.
  • by blue9steel ( 2758287 ) on Wednesday October 22, 2014 @11:35AM (#48204531)
    The main problem with space travel so far has been a combination of custom parts and lack of scale. Get a cheap, rugged design made with commodity parts and then run it mass production style and you can really bring the cost down.
  • You say it's easy. Then why don't you go and do something with your lives? I only wish we had a few more of people like this. Yes, he is rich, and he is planning to become even richer. At the same time, he is investing HIS money into something he believes in. Only hope he starts looking into things like hyperloop, and to make that financially viable.
  • by Anonymous Coward

    At $4,653/kg to LEO it would cost rought 400K to push an average human to LEO which is significantly lower than what NASA pays the russians to do the exact same thing, hell they could make all their profit margins with massive room to spare by only charging NASA 1/10th what they pay Russia. Why is NASA wasting our money and boosting russias economy instead of doing this which would save massive amounts of money that could be spent otherways and would boost our local US economy by having the money re-enter

  • by Bearhouse ( 1034238 ) on Wednesday October 22, 2014 @11:41AM (#48204605)

    Make a rocket at least 10 times cheaper than is possible today.

    Hardly "prosaic"; Sounds pretty damn ambitious to me.
    OK, they had access to some of the body of knowledge so expensively won by the Germans, USA, Russians et al, but they're still privately funded, developed in-house a working product that's much, much cheaper than the competition and employ nearly 4000 people.

    Like Musk or not, he made it work so far.

    • Re: (Score:2, Informative)

      by Anonymous Coward

      Hardly "prosaic"; Sounds pretty damn ambitious to me.

      Prosaic isn't the opposite of ambitious. It's the opposite of poetic.

      "To secure humanity's future in the stars." - ambitious and poetic
      "To make a rocket 10 times cheaper." - ambitious and prosaic

      • Referring to the goal as prosaic isn't a good usage of the word. Used correctly, the header would have been something like: "...began with a prosaic declaration: Make a rocket at least 10 times cheaper than is possible today." Nothing about the initial goal is prosaic; it is the way Elon Musk described it in his manifesto for SpaceX that was blunt and matter of fact.

  • >>"Make a rocket at least 10 times cheaper than is possible today."

    Ughh! It isn't 10 times MORE of something, it's 1/10th as much of something!
    Also, it's a monetary goal, not quality one. It isn't cheaper it's less expensive.

    Does anyone really want to: "Make a rocket at most 1/10th the quality of what is possible today"?

    • by danlip ( 737336 )

      "low quality" is the third definition of cheap (according to Webster's). The first 2 are basically equivalent to "less expensive". If you want to be pedantic, do it right.

  • Best Quote (Score:5, Funny)

    by j33pn ( 1049772 ) on Wednesday October 22, 2014 @12:53PM (#48205257)

    Quote from Hans Koenigsmann, early German SpaceX employee, "My German accent helps in presentations. When I say, ‘This will work,’ it is more convincing than other accents for some reason.”

    • by Anonymous Coward

      Ultimately, the success of any space enterprise seems empirically to depend on the presence of Germans.

  • I don't know that much about him other than as an investor, but the thing I have noticed about Elon Musk is that he does the homework. He works the numbers and if they don't add up he does something else. So although it seems to an outsider that he is doing something wild, he is actually keeping to a dry spreadsheet.

    Someone who didn't do this might have tried a newer whiz-bang battery technology for Tesla. Or maybe fuel cells. Instead he stuck with "boring" old Li-Ion battery technology because he found

  • from Paul Spudis, "the Potemkin Village “commercial space program” is trotted out to demonstrate that we are accomplishing something."
    http://www.spudislunarresource... [spudislunarresources.com]
    Well at least Elon had some hardware built instead of just PPTs. But some argue commercial space companies, "To be fair, probably about 25% of New Space does have some minimal substance, but over the past decade the clear majority of them have never amount to anything beyond a press conference where they make grandiose promises

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