Space Business: Forum Fatigue

Where will reliable rules for space behavior come from?

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Dear readers,

Welcome to Quartz’s newsletter on the economic possibilities of the extraterrestrial sphere. Please forward widely, and let me know what you think.

This week: Davos discourse, snowpack in the Sierras, and the nuclear road to space.

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Everything about the World Economic Forum in Davos, Switzerland, is symbolic of global governance writ large: A gathering of leaders, thought and otherwise, intent on solutions but lacking the resources or mandate to provide them.

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The ability of supranational organizations to enforce reliable norms has been challenged by an increasingly multi-polar world—just look at recent failures at the World Trade Organization or the World Health Organization. Yet our ability to take on challenges, from climate change to the coronavirus, depends on international cooperation, and no more so than in space.

Jesse Klempner, a partner at McKinsey & Co. focused on the aerospace industry, is on the ground in Davos and says the nattering nabobs of networking are starting to recognize space as more than a niche obsession or the province of government agencies with multi-billion dollar budgets. But his biggest concern for the future of the space economy is still whether policymakers around the world manage to split the difference between competition and collaboration.

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In a white paper Klempner and his colleagues prepared in collaboration with the WEF, the future of space is divided into four potential outcomes: An ideal world where a diverse space economy blossoms; one where only major companies and government agencies can bear the risk of extraterrestrial activity; another where space becomes limited to military actors alone; and a dismal outcome where the potential of space is unrealized.

The key to unlocking a future of space productivity, per the report, is in global governance: Rules for space traffic management, protocols for space debris mitigation and removal, and norms for economic activity in space, from resource extraction to property rights. Just about anyone you talk to in space world thinks these things are necessary, but the progress toward them has been slow and ad hoc.

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It’s clear that space actors have outstripped their regulators, but what will change that dynamic is less obvious. The steady increase of financial value on orbit is providing pressure to take action, but the most influential actors in the space economy, whether nation-states or companies, are still happier with a free hand than an insurance policy.

What might change that, the report suggests, is a disaster. Comparing space transport with the rise of aviation, the report notes the 1956 Grand Canyon disaster, when two commercial airplanes crashed into each other, prompted the creation of the Federal Aviation Administration. Will it take a satellite collision or worse for effective action on space norms? The last major accidental crash occurred in 2009 between an Iridium spacecraft and a defunct Russian satellite and was seen as an anomaly, but the number of active satellites has increased five-fold since then.

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Klempner, at least, thinks progress will occur over time, with diligent efforts to solve each piece of the overall problem. On the one hand, he notes that space activity is already imposing real costs on space actors, such as shorter launch windows. On the other, he’s not seeing as much regulatory action as he would like. Klempner points to the growing support for a ban on anti-satellite weapons tests as one sign of progress, but that effort came after a series of particularly messy orbital tests, and can be seen as an effort to limit Chinese and Russian weapons development.

Working together can be difficult even among partners. The US-driven Artemis Accords, a multilateral project to develop a framework for activity at the Moon, have garnered support from 23 nations. But a new NASA inspector general report (pdf) notes that actual international cooperation on a lunar return is limited by US laws on technology exports. Japan, for example, has yet to send an astronaut to the US to prepare for missions to a planned multinational lunar space station because of restrictions on access to critical information.

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“What I would love to see governments do, the thing I would love for all of the actors in the market to say, let’s only focus on putting national protections around things that are truly critical and keep the bar as high as possible for protectionism in the market,” Klempner says.

That kind of transparency is important not just because it will lead to more efficient and productive activity in space, it’s also the path toward trust among international actors. The more the US hides what the Artemis program is doing, the more credence the US gives critics who say it is a plan for exploitation, not exploration.

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IMAGERY INTERLUDE

Here in California we’ve been deluged with rain thanks to an atmospheric river flowing overhead. How to track the impact of this weather phenomenon? Turn to satellites. Check out these two images of the Sierra Nevada mountain range shared by Colin McCarthy on Twitter; the first from late September, and the latest from Tuesday (Jan. 17).

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Graphic: GOES/Colin McCarthy

Look at all that snow! The hope here is that it replenishes reservoirs over the course of the spring.

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SPACE DEBRIS

SpaceX is doing just fine without Elon. Bloomberg’s Loren Grush takes the temperature at SpaceX while CEO Elon Musk is scrolling on Twitter, and finds the team is more focused without Musk’s mercurial direction. SpaceX’s strength in execution has always come from its senior executives, but getting Starship to orbit is their biggest challenge yet.

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SpaceX’s market dominance isn’t forever. The Jan. 15 launch of a Falcon Heavy rocket for the US Space Force is a reminder that while SpaceX currently has a monopoly on heavy lift (and human spaceflight), those days are likely numbered.

Rocket Lab’s Neutron aims for national security contracts. CEO Peter Beck says the company’s under-development medium-lift rocket—expected to deliver as many as 15 metric tons of payload to low-earth orbit—could compete to fly satellites for the US military. However, that’s only if Rocket Lab (NASDAQ: RKLB) is allowed to participate without also offering a heavy-lift rocket of its own.

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Planet’s SPAC worked out just fine. Here’s an interesting interview with Planet (NYSE: PL) CFO Ashley Johnson, who says her company’s arrival at the public markets through a blank check transaction set it up for success. Space biz readers saw it coming.

DARPA wants private companies to monitor low-earth orbit. The Pentagon’s strategic R&D arm is looking for companies that use satellites to track activity in space near the Earth.

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Why do we need nuclear propulsion in space? As is often the case, the answer is Mars.

Your pal,

Tim

This was issue 165 of our newsletter. Hope your week is out of this world! Please send your blue sky visions for space law, Starship orbital test predictions, tips, and informed opinions to tim@qz.com.