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In 2022, 87 American orbital rockets took to the skies. 86 of those were owned and operated by commercial companies.
It’s a staggering statistic, but not a surprising one. Space’s geopolitical and commercial importance is swelling, and US companies are cashing in by developing spiffy, low-cost technology and offering it to just about anyone who pays. Governmental entities like NASA (and, more recently, the US Space Force) have proven particularly fruitful customers. By outsourcing the heavy lifting, they can make their budgets go further, also earning some political brownie points through boosting the economy while they’re at it. And it has worked; all that outsourcing and fostering of industry helped the US regain its status as space superpower.
But while the US government enjoys the benefits of space on the cheap, its own technological prowess is waning. Not just launches, but commercial satellite systems, space station designs, and countless other space technologies are either already overtaking governmental capabilities or are posed to do so soon. As commercial companies’ expertise grows, so does their power – power to pursue their own goals and influence space policy to better suit these, a process which is already beginning. The state, meanwhile, has few options to maintain its advantage in space.
US governmental entities may have outsourced more than just a few technologies – the future of space and its exploration might have been on the docket, too.
To understand the background to this predicament, look no further than 2022’s vehicle number 87: NASA’s SLS rocket, a towering orange beast designed for the agency’s lunar program, Artemis. Chronically delayed, outdated, and exorbitantly expensive, it highlights growing cracks in NASA’s modus operandi: dependence on politics, good optics, and PR, with no option for failure. It seems like quite the fall from grace considering NASA’s history as a spaceflight giant – having masterminded the Apollo and Shuttle programs – but these issues have always plagued its projects.
With the infamous tragedies of Apollo 1, Challenger, and Columbia leaving lasting scars, any iffy behavior – including occurrences during testing – from a high-profile rocket the taxpayer paid billions for is not only embarrassing, but risks political condemnation. So NASA plays it safe. Instead of messing around with innovations that might pose challenges, the agency reused old technology from the Shuttle; this also came with the benefit of keeping Shuttle contracts and jobs going, which goes over well with Congress. The result was the SLS, a nonreusable rocket hailing from the previous century that flew after six years of delays, costing over $4 billion a launch – even though it was originally optimistically intended as a Shuttle replacement.
Still, as a politician-friendly nod to the agency’s glory days, the rocket serves a mostly terrestrial purpose. NASA leaves the bulk of spaceflight to private companies, who can produce riskier technologies from beyond the political limelight and require lower governmental investment. As a result, the agency accepts less accountability for the projects and acts as a customer instead of lead designer.
The US government recognized the need for such a scheme in the 1980s, when launch commercialization was signed into law; lessening government expenditures was one of the Reagan administration’s priorities. At first, the heavily subsidized Shuttle beat out most competition. Following 1986’s Challenger disaster, NASA opted to no longer fly commercial payloads (but still humans) aboard the Shuttles, passing these launches off to the private industry. In the following years, both governmental and commercial entities became legally required to source space services from the commercial sector ‘to the fullest extent feasible’, and NASA in particular was made to purchase commercial launch services for its primary payloads.
The industry really found its feet during the early 2000s, helped along by a flurry of new legislation, when privatizing what was previously controlled by government was coming in vogue in Washington. The period saw two important developments: the dawn of several ballsy startups (especially SpaceX, which hoped to offer low-cost launches with reusable rockets), and the introduction of a new fixed-price contract system from NASA. As opposed to the cost-plus contracts that offered the agency more control over projects, NASA now called on companies to propose services, then selected which ones to invest a certain amount in. As explained here, the company would use the money to develop its technology and then sell the service to NASA and other customers, with the ownership and operations remaining with the company. It’s a win-win; NASA doesn’t have to fork out as much for development, and the company gets a nice bonus to fund work it was doing anyway.
The rest was history. SpaceX, with the help of private and government investments, went on to develop its Falcon 9 rocket and Dragon spacecraft, both of which are now frequently used by governmental and commercial customers alike. The company’s method of reusing its boosters, fairings, and Dragon capsules saves them tens of millions of dollars, allowing them to offer launches at previously unheard-of prices. After almost a decade of reliance on Russian Soyuz rockets for access to the ISS, SpaceX brought the US back into the game in 2020. And the company is not picky; humans, satellites, scientific probes… you name it, SpaceX will launch it. The company is now developing its fully reusable Starship, which, if it succeeds, would dwarf even the gigantic SLS’s capabilities.
SpaceX’s success story inspired a host of smaller launch companies to pop up in order to feed a market desperate for access to space. Even SpaceX’s current breakneck cadence of one launch every 4.11 days is not enough to fill an emerging launch shortage, exacerbated by the Soyuz now being non grata for most Western customers.
And that’s just the launches. As those were developing, miniaturization of technology allowed satellites to be much lighter, cheaper, and more efficient, eventually evolving into the standardized CubeSat. Suddenly, space was within reach; it was no longer astronomically expensive to put something into orbit. This opened the door to countless new ventures, including satellite internet, orbital intelligence, tourism, and even mining and manufacturing startups.
These technologies and more are connected by one overarching theme: few US government projects can keep up with them. As a result, NASA and other governmental institutions now rely on the private sector for a big chunk of their space endeavors. Everything from launches to orbital espionage to military communications to NASA’s new lunar suits is now outsourced – and commercialization is still in its relatively early days.
This trend is set to continue and evolve, with US government actors banking on commercial ventures to bring them into the future. To replace the ageing ISS, for example, NASA has contracted several private companies to design a successor. The agency is relying on SpaceX and Blue Origin to land its astronauts on the moon once they have been shuttled to lunar orbit by the SLS rocket and Orion spacecraft. NASA has also funded and supported companies developing technologies vital for a sustained presence on the moon, such as power systems, mining, in-situ resource utilization, and manufacturing.
With such a wide variety of high-tech companies at their disposal, it seems like NASA and other US governmental institutions are made in the shade. But while much of the current industry still rallies around high-paying government contracts, commercial companies are not synonymous with the state. As independent actors, they have their own interests. Right now, with the private industry still young, these desires might align with what the public voted for; bagging lucrative government contracts remains high on the to-do list of many companies. But if the company finds bigger fish to fry elsewhere – say, establishing a hardy satellite internet constellation or building a city on Mars – and states’ interests are no longer the priority, governments might find themselves up a certain creek without a paddle.
The US Defense Department experienced such an awkward situation at the hands of SpaceX’s satellite internet venture Starlink, a priceless military tool which Ukrainian forces have been utterly dependent on; it has reportedly saved ‘thousands’ of lives in the war. But to the ire of officials, the company has not always played nice. After shelling out $20 million a month to provide the service and thousands of terminals to Ukraine and fighting off Russian cyberattacks, Starlink demanded the US government fund any future use, claiming it could not financially sustain the donations. Though Starlink boss Musk backtracked and stated his company would nevertheless continue to provide the service, some terminals were turned off due to a ‘lack of funding’ amid negotiations with US officials. That was not the only snag; Starlink had also reduced service when it was used for ‘offensive purposes’. According to Gregory C Allen, a former Defense Department official, ‘it has certainly been a long time since we’ve seen a company and an individual like this go pretty openly against US foreign policy in the middle of a war.’ Not long after, the funding issue was ‘resolved’ after a group of European countries agreed to pay for another 10,000 terminals; no governmental service could compete with Starlink’s coverage. The service in the region is now paid for by the Pentagon.
This incident stands out because it is one of the first instances of a commercial space company using its dominance in a way that did not align with state interests – and there was not much the states could do about it (except pay up). As the gap between governments’ and companies’ technological capabilities grows, scenarios where the distribution of power is suddenly flipped are bound to become more common. And if they occur further from Earth, governmental pressure could become even weaker.
But are the state’s hands really tied? After all, businesses based in the US must adhere to US law, which can be unforgiving if national interests are put at risk. However, the speed at which companies are developing technologies cannot be matched by governments; the control lies in the hands of the commercial sector, and throttling it would mean forsaking the US’s upper hand in space and damaging a booming industry. Especially considering SpaceX’s near-monopoly of launches and satellite internet, its services’ extreme importance to both governmental and commercial exploits limits the extent to which it can be restricted; there is simply no alternative.
Business and law must not always clash; as seen in other industries, regulations can be molded to better suit commercial exploits. This rings especially true in the thinly-regulated domain of space. Here, international law is vague and outdated, leaving much room for interpretation at the discretion of the state. Corporate influence on policy is well established in the US, and the relatively young space industry is already making its mark with the Artemis Accords. Signed by an ever-growing number of countries, this nonbinding agreement hopes to establish new norms for the peaceful use of space, while also throwing in the building blocks to establishing a private industry within it.
Some of these rules, were they binding, might violate UN space law. For example, they mention ‘safety zones’ for mining, which could be interpreted as claims of sovereignty: something UN space law explicitly forbids. But even though the Accords are not technically law, the US fosters hope that they might one day dictate standard practice. ‘[The US creates] guidelines with the hope that eventually they will develop into customary law that will weaken the existing space law. That’s a really clever maneuver’, notes Stephan Hobe, director of the Institute of Air Law, Space Law and Cyber Law at the University of Cologne, Germany.
The grasp of governments already slipping, exploration into deeper space might see even more extreme bending of laws. SpaceX, for one, is already making noises in that direction as it sets its sights on its ultimate goal of colonizing Mars. Hidden inside Starlink’s terms of service is a clue as to what one of the company’s Martian colonies could look like: ‘For Services provided on Mars, or in transit to Mars via Starship or other spacecraft, the parties recognize Mars as a free planet and that no Earth-based government has authority or sovereignty over Martian activities’. The prospect does not only violate existing jurisdiction, but also highlights the elephant in the room of space law: it is quite unenforceable. While companies are still bound to Earth, governments still have some say, but that’s not the case on Mars. Even if they tried, it’s not like they’d have a rocket to chase rogue colonists around with.
Commercialization might have been the best and worst thing to happen to NASA and other governmental entities. It singlehandedly salvaged the US’s then-waning space power and turned it into a powerhouse of technological capability and geopolitical dominance. At the same time, however, it laid the groundworks for the demise of governmental space power, leaving a realm previously controlled by voters at the mercy of commercial whims. And while NASA’s priorities already largely clash with public opinion, its projects still have some semblance to a kind of unity: one agency going into space, representing the whole country or, at times, the world. That sense of togetherness is now lost to commercialization, with the public increasingly out of the loop.
That’s not to say NASA and other state institutions will become completely obsolete; their scientific and defensive projects are here to stay. But by outsourcing its technology and therefore power, the agency is a shadow of its former moon-landing self, helplessly dependent on the commercial sector for even the simplest of missions. In a way, NASA sold its soul to save US space endeavors. It also changed spaceflight forever.