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: Make money on every flight, meet the woman in the moon, and tweet like you’re a Russian robot in space.
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A major objection to space business is nobody makes any money doing it. It’s a good objection!
Government contractors and satellite TV broadcasters, along with their supply chains, do well in the current ecosystem. But we’re still waiting to see if space companies with ambitions of serving a different customer base—your Virgin Galactics, your Planets, your Made-in-Spaces, your Momentuses—can succeed as profitable ventures.
So it was noteworthy that after Blue Origin’s reusable New Shepard rocket completed its thirteenth mission on Oct. 14, soaring 65 miles (105 km) to the edge of space and returning to earth safely, CEO Bob Smith characterized the program as profitable. “We make money on every flight,” he said.
Erika Wagner, Blue Origin’s payload sales director, told Quartz that the company decided in 2019 to dedicate the vehicle that launched this week to cargo flights. “We’ve had 10 consecutive flights with payloads on board, have flown over 100 payloads total, and have had paying customer payloads on every flight,” Wagner told Quartz. “We have customers booked on flights for the next couple of years and are rapidly filling those manifests.”
Could Blue really be flying this cargo profitably?
The company didn’t want to talk specifically about the economics, but we can make an educated guess. Scientists are willing to pay handsomely to loft research payloads into a microgravity environment. For this flight, NASA paid Blue Origin about $700,000 to test moon landing technology, alongside eleven other research payloads.
In the past, the company said one of its full-size research payload lockers costs between $50,000 and $120,000, although it has smaller spaces available for as little as $8,000. Not knowing all the details, let’s put the revenue for this launch in the ballpark of $1 million.
How much does it cost to fly the New Shepard once? Again, we’re reduced to educated guessing. One ballpark figure is the estimated per-flight cost of Virgin Galactic’s Space Ship Two rocket plane, a very different vehicle but with similar capabilities, which came in at about $430,000 in the company’s 2019 prospectus. Both these vehicles are reusable, so the marginal cost comes down to propellant (fairly cheap); the team of technicians, engineers, and other support staff (Blue says it needs “fewer than 26 people” in the control room); and whatever inspections and refurbishment must be performed before and after flights (unknown territory).
So it’s believable that the New Shepard made a profit on this individual flight, maybe even a large one. But nota bene: Much of the revenue here still came from the government. And more importantly, given the hundreds of millions of dollars Blue Origin founder Jeff Bezos spent developing the New Shepard, the vehicle likely only makes accounting sense as a pilot project for the company’s forthcoming New Glenn rocket and more lucrative engine-building work.
Or, perhaps, if it starts flying people. Blue Origin hasn’t said how much passenger tickets for New Shepard will cost, but Virgin Galactic is charging $250,000 a seat. At that rate, a New Shepard launch could bring in $1.5 million a flight.
But the enduring mystery of New Shepard, originally billed as a space tourism project, is why it has yet to take a person into space after thirteen apparently successful test flights. Blue didn’t want to talk in detail about the development program, rumored to see its first human passenger in 2021, but Wagner said that “all the flights in our program have been a part of the verification process and practicing operations for first human flight.”
The future of both Blue Origin and Virgin Galactic is likely to include flying research and researchers: Yesterday, Virgin Galactic announced that Alan Stern, a planetary scientist, would be the first to fly alongside his experiments in a mission funded by NASA to the tune of $450,000 to $650,000. That flight isn’t likely to happen until after the company makes its first trip to space from its new headquarters in New Mexico sometime later this year.
That means 2021 might bring with it actual competition between two different space tourism companies, moving that much closer to space tickets cheap enough to afford without NASA footing bill.
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IMAGERY INTERLUDE
One of the first science fiction films premiered today in 1929—Frau im Mond, or the Woman in the Moon. A classic tale of love, greed, and adventure, it was directed by the legendary Fritz Lang, with technical advice from Hermann Oberth, a founding father of rocket science and colleague of Werner von Braun working for both the Nazis and NASA. The film was one of the first cultural products to show off things like a launch countdown and the effects of microgravity, just three years after the first launch of a liquid-fueled rocket—and twenty years before the first one left the atmosphere. You can watch the whole film on YouTube, and it’s honestly still pretty compelling.
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Consulting may be the biggest industry nobody really sees. The world’s biggest companies use outside consultants to help them decide how to direct their resources. Governments, too: Consultants like Deloitte and Accenture are among the US government’s largest outside contractors of any kind, with contracts totaling in the billions of dollars.
But in a pandemic, the consulting industry’s favorite move—flying in small armies of recent college grads to give whiteboard presentations—is harder to execute. Read more about how the hidden hands of the business world are navigating the pandemic in our guide to consulting’s new challenges.
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SPACE DEBRIS
Is Russia’s space czar losing his grip? Dmitry Rogozin, the head of Russia’s space program, has always been a colorful character and a robust defender of Russia’s space ambitions. Now, though, he’s being called out on Twitter for letting Roscosmos slip behind the US. Rogozin gave up his personal account, reportedly after one public feud too many, but some suspect he’s not off the platform entirely: When former cosmonaut Maxim Suraev pointedly compared new American spacecraft to Russia’s legacy vehicles, the official Twitter account of a Russian space robot named Fedor accused Suraev of being drunk in space. Who says this beat is boring?
NASA’s diplomatic push. The US effort to do an end run around the United Nations and use bilateral talks to create rules for behavior on the moon took another step forward this week as seven nations—Australia, Canada, Italy, Japan, Luxembourg, the United Arab Emirates, and the UK—signed on to the Artemis Accords (pdf) for peaceful exploration. Predictably, both China and Russia, who see the proposals as US unilateralism, aren’t in the tent. More notably absent are key EU spacefaring nations France and Germany. Without full backing from Europe’s most influential states, it’s hard to imagine these guidelines becoming an international standard.
Uh oh. LeoLabs, the private space traffic tracker, has been warning about a potentially dangerous collision between a defunct Soviet satellite and a discarded Chinese rocket stage that could occur on Oct. 16. The company’s data predicts the spacecraft will pass within 12 meters of one another at a relative velocity of 14.7 km/s, with a chance of collision of greater than 10%. A collision is likely to generate a new collection of space junk that will present new dangers to orbiting objects, and only underscores the pressure on space stakeholders to protect the environment in low-earth orbit.
Are satellites a rural internet solution? The US government released a list of companies (pdf) eligible to bid for a $16 billion pot of subsidies to supply internet to underserved rural communities. Among them are at least three satellite players—SpaceX, ViaSat, and Hughes. Terrestrial internet providers have complained that SpaceX in particular has yet to bring its low-flying Starlink satellite network into regular service. However, the FCC has proven amenable to ambitious satellite proposals in the past, and now SpaceX may unlock a new source of government support for its work.
Fill ‘er up. One big hole in our collective fantasy of extracting liquid propellants from ice on the moon is that the technology for in-space refueling isn’t well developed. Not for long: NASA is spending $375 million on a passel of programs to figure out how best to move super-cold fuels around in a microgravity environment.
Your pal,
Tim
This was issue 69 of our newsletter. Nice. Hope your week is out of this world! Please send your favorite space cocktail recipes, leaked financial data on human spaceflight tourism companies, tips, and informed opinions to tim@qz.com.