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Companies Skeptical of Commercial Space Market

Soulskill posted more than 4 years ago | from the come-on-it's-not-rocket-sci-oh-wait dept.

Businesses 192

Hugh Pickens writes "The NY Times reports that Boeing and Lockheed Martin will happily sell rockets to carry astronauts into space, but are leery about taking a leading role in President Obama's vision for a revamped NASA that relies on commercial companies to provide taxi transportation to the ISS. 'I don't think there is a business case for us,' says Lockheed Martin's John Karas about space taxis. Both Boeing and Lockheed were stung during the last burst of optimism for the commercial space business about a decade ago. They invested several billion dollars — Lockheed to develop its Atlas V, Boeing for the Delta IV — in the hopes that the huge market for commercial satellites would supplement their traditional business of launching American military spy satellites. The market did not materialize, and what business there was went to European and Russian rockets that were cheaper. The hoped-for commercial market for space taxis hinges on one small company, Bigelow Aerospace, which is developing inflatable space habitats that it hopes to market as research facilities to companies and foreign nations looking to establish a space program."

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192 comments

riiiight (4, Insightful)

jollyreaper (513215) | more than 4 years ago | (#31822548)

Wait a second. They're saying there's no market and then they're saying cheaper competitors are snapping up all the business? Fellas, I think the invisible hand of the market is flipping you off.

Re:riiiight (5, Interesting)

Knara (9377) | more than 4 years ago | (#31822632)

Is sort of what I got from it, too.

I suspect that "there isn't a business case" really means "we liked it better when we had a guaranteed customer who would pay us whatever we and our one main competitor decided was the going rate for a launch vehicle. Please don't make us actually innovate and compete."

Re:riiiight (4, Interesting)

sillybilly (668960) | more than 4 years ago | (#31823890)

There really isn't a free market business case for it. People go to space simply to make living under unlivable conditions a status quo. If you can live in the vacuum of free space only on sunshine, fully recycling all the excrements into reusable things, you can almost make it no matter what. Living in space is a safety thing for life from Earth against a global catastrophy, such as an asteroid hit, anoter world war, nuclear holocaust, etc. You never know. There is really no free market for safety and security, unless the unthinkable happens, and then comes the should have, would have, but didn't. Maybe next time. If there is always a next time. Next time I'm not gonna keep all my eggs in the same basket. But going to space is not gonna solve a whole lot of issues, especially security issues, such as developing AI that is smarter than us, and hunts us. Space is no hiding place from stronger intelligence, should it be carnivore. But it does help some things.

For instance, as a side benefit, in space recycling is mandatory. On Earth we may never put the resources to fully recycle, because there is no free market business case for it. It's always cheaper to litter your environment full of trash and forget about it than have to take care of it right now. Being in space would force us to immediately come up with full recycling techs, and improve them to the point where recycling almost make business sense down on Earth. Who's gonna put the resources into it down here?

The only way space can make business sense is how Formula 1 makes business sense - as a show. But space is boring. It has to be boring to be professional. Formula 1 is boring to a lot of people. But it does get quite a bit of audience, to the point where it's profitable. Unfortunately the cost of a space show dwarfs the cost of Formula 1 in comparison. It's just simply too expensive to make business sense. Like the military, if it had to be free market supported, how much would you personally donate each month from your salary to support our troops? Or what would you pay for? The labor day air show?

Re:riiiight (3, Informative)

icsEater (1093717) | more than 4 years ago | (#31822674)

They're saying there is no market for investing in new expensive launch vehicles with all the quadruple redundancies and fail-safes imposed by the government. There's already a crop of old but reliable Soviet technology that does the same.

Re:riiiight (2, Interesting)

cheesybagel (670288) | more than 4 years ago | (#31823488)

The only figures I saw there regarding expenses were $400 million and $1 billion. If you know the space R&D business you would know those costs are tiny. Just developing a new rocket engine, under incumbent methods, can easily cost more than that. The contract for the J-2X engine for Ares-I X alone was $1.2 billion.

Re:riiiight (2, Insightful)

OeLeWaPpErKe (412765) | more than 4 years ago | (#31823560)

Reliable ? You cannot seriously be referring to the Soviet space program [wikipedia.org] .

Well, it was reliable in that they hardly ever failed to have huge accidents. Nor did they ever fail to deny this with propaganda. It helps if your launch site does not have any reporter within a 1000 km radius if you want to coverup fuckups.

I know this is very anti-postmodern but just because you don't see or don't know about something, doesn't mean it's not real. You'd think the fact that rain makes you wet at night would stop this sort of nonsense, but these are academics we're talking about.

Re:riiiight (2, Insightful)

cheesybagel (670288) | more than 4 years ago | (#31823844)

It's reliable now after a painstaking debugging process of many decades. Practice makes perfect you know.

Re:riiiight (4, Interesting)

sunspot42 (455706) | more than 4 years ago | (#31823962)

Soyuz - which is the current Soviet manned space booster - hasn't had a fatal accident now in decades. It's old but very reliable. My guess is the big US aerospace firms can't really compete with it, at least not without sinking many billions into development costs and potentially having their own string of catastrophic failures to learn from (the way the Soviets did). They're probably also worried about demand for manned boosters going forward, and possible competition from the Russians, Europeans and - eventually - Chinese. Even if the US aerospace firms were successful in developing a manned booster, it might be difficult for them to ever recoup their development costs due to competition alone. They may feel there are better ways to spend their money, probably on defense-related programs where the margins are much higher and the competition less intense.

I know this is very anti-postmodern, but just because you don't see or don't know about something, doesn't mean it's not real.

Re:riiiight (1)

Darkman, Walkin Dude (707389) | more than 4 years ago | (#31823860)

Yes, because European governments are well known for their light touch hands off safety regulations.

Re:riiiight (1)

LWATCDR (28044) | more than 4 years ago | (#31822844)

The military asked Boeing and Lockheed to develop a new launch vehicle to replace the shuttle and TitanIV.
The told them that they could recover some of the cost by launching civilian sats. At the time there where export limitations on what you could launch from Russia.
Those restrictions have bee lifted and now they must compete with Russia and the ESA.
The debate as to who is more subsidized between Launch Alliance, Russia, and the ESA is one I sure don't want to get into but right now the US companies are not doing well in that price war.

Re:riiiight (2, Informative)

cheesybagel (670288) | more than 4 years ago | (#31823950)

Actually they (and a lot of new corporations at the time) thought they were doing to launch dozens, nay hundreds, of commercial LEO constellation satellites at the time. Like, you know, Iridium. Well Iridium went bankrupt when their satellite phones couldn't compete with terrestrial cellphone networks. As for the GEO satellite market, intercontinental satellite phone calls mostly go through fiber optic submarine cables now. The remainder markets are niches in the middle of nowhere. Where there isn't a lot of money to invest in these shiny toys. Well except if you are the military anyway. Or in an oil platform.

In the other hand satellites for terrain imaging continue to be pretty successful. Space is the ultimate high ground after all.

Re:riiiight (1)

ThreeE (786934) | more than 4 years ago | (#31822888)

Monopsony does not generate a competitive market -- especially government monopsony.

Re:riiiight (1)

vlm (69642) | more than 4 years ago | (#31823072)

So, when an American aerospace company realizes they can't compete with imports, they refuse to enter that market segment.

When an American automotive company realizes they can't compete with imports, they double down, then get bailed out by the govt.

I'm confused why the different reactions. Just random chance that it falls out this way?

Re:riiiight (0)

Anonymous Coward | more than 4 years ago | (#31823194)

the difference is aerospace cash cow is milking the us government.

While the car industry does sell to police and even the president, it is very rare that they get continued access to the us proverbial tit the way defense contractors do.

another this is aerospace companies can accidentally break things and the us government has to pay for the replacement. if a car make breaks something ala toyota then consumers just stop buying toyota.

so car companies really only have 1 market.

as for asking why then American car companies try at all its probably cause they don't want to admit failure and the execs still get paid so they don't care what happens either way.

Re:riiiight (1)

h4rr4r (612664) | more than 4 years ago | (#31823234)

GM should have been allowed to die.
The money would have been put to better use doing any number of things including funding new automakers or not spending it at all. Their ex-employees seem to be capable at building Hondas so clearly management was the issue.

Government is Clueless about Business (0, Insightful)

Anonymous Coward | more than 4 years ago | (#31822576)

The government is clueless about business, just as they always have been.

Working for a non-profit and organizing 4000 people who aren't paid isn't much of a background to understand how commercial, for-profit, companies must work to make shareholders happy.

Re:Government is Clueless about Business (-1, Troll)

Anonymous Coward | more than 4 years ago | (#31822620)

The government is clueless about business, just as they always have been.

Working for a non-profit and organizing 4000 people who aren't paid isn't much of a background to understand how commercial, for-profit, companies must work to make shareholders happy.

There's a very easy way to make a metric TON of cash on this. Just tell everyone that they will put all of the niggers on a gigantic spaceship and send it into the sun. Overnight, BAM! Trillions of dollars in investments. For tens of trillions, offer to put the jews in there too.

It's amazing what we could accomplish if we all work together!

Re:Government is Clueless about Business (1, Interesting)

blair1q (305137) | more than 4 years ago | (#31822778)

If you were thoughtful, instead of a talking-point parrotting teabagger, you'd be happy that the government is getting out of the space business and telling the business businesses to figure it out.

Because we're tired of coming up with all this cool space shit just so they can adapt it to their launch systems and still lose money launching our satellites under cost-plus contracts.

Or maybe the point is that business no longer knows how to stay in business, and new businesses need to come along and take it from them, now that the government is no longer propping them up by paying for all of the technology investment and absorbing the risk of failure.

BTW, how many of anyone have you organized in your life? By your logic, that makes you incompetent to judge the skills of anyone who has. You'll still be free to toss your vote in the trash next time around.

Re:Government is Clueless about Business (3, Interesting)

causality (777677) | more than 4 years ago | (#31823286)

If you were thoughtful, instead of a talking-point parrotting teabagger, you'd be happy that the government is getting out of the space business and telling the business businesses to figure it out.

Just curious, why does the Tea Party movement catch so much flak? It's interesting to see during my lifetime that people are showing their dissatisfaction with an ever-growing federal government. It's gratifying to see they are doing this in a "bottom-up" fashion instead of a "top-down" organization, as so many of those are just front groups for various monied interests. It's particularly nice that the majority of its members are more concerned about reform and have little or no concern about party affiliation, since I've always viewed the two-party duopoly as the biggest single part of the problem. Well, that and the massive rate of incumbency.

I can understand disagreeing with their politics. I can understand being opposed to their methods and goals. What I can't understand is the look-down-your-nose disdain that you and many others have shown. If they were an entrenched "establishment" type of political party like the Democrats and Republicans, would that impress you? Would you then feel a desire to back up your demeaning tone with substantive disagreement? Much of this, when I see it, looks like "I have decided I don't like them, and I'll get around to coming up with reasons for it later" rather than having a good reason before deciding not to like them. It looks that way and I'm wondering if it really is that way. I don't know the answer to that, but I would like to.

The way I see it, the federal government is far out of control. We have ACTA and other bad laws that we the people have absolutely no control over, in which we have no voice at all. Every new federal agency becomes a permanent fixture, never to be disbanded. Every entitlement and social program will never be repealed no matter how bankrupt. No law is too intrusive, nor any justification too flimsy. This is not remotely what our government was intended to be, not even close. If a new movement wants to oppose this, why wouldn't I welcome the sight? Should I quibble over my personal feelings towards them in the face of this?

Ever watch old kung-fu movies? I find it fascinating the way mortal enemies still have a genuine respect for one another. Each sees that his opponent is skillful and formidable and honors this. There is none of this catty, petty personal hatred, disdain and "degrade or insult at every opportunity" mentality. Some armed conflicts in real life have been this way; I believe WWI was the last. There used to be the notion that if you lose your honor by engaging in those low-road practices, then the conflict has cost you quite a bit more than even the casualties sustained. What's happened to us?

I should add I am not a member of the Tea Party movement. I have not been to their events or participated in their campaigns. It's just that one thing is consistent whether it's politics or philosophy or even IT: anytime someone acts like a raw nerve has been struck and wants to denigrate what he disagrees with for no apparent reason, that raw nerve deserved to be struck. Watching this only lends credibility to the side that does not do it.

Re:Government is Clueless about Business (1, Troll)

causality (777677) | more than 4 years ago | (#31823302)

Don't mean to reply to myself but I wanted to add one thing. Ever wonder why Americans have a bad reputation throughout much of Europe and other parts of the world? That's easy. It's because they see the actions of our federal government and mistakenly believe that it represents us, that it is carrying out our wishes. No wonder we look so bad to so many of them.

Re:Government is Clueless about Business (3, Informative)

CRCulver (715279) | more than 4 years ago | (#31823652)

It's gratifying to see they are doing this in a "bottom-up" fashion instead of a "top-down" organization, as so many of those are just front groups for various monied interests.

There's been plenty of examples of supposedly grassroots events being in fact organized by large, highly funded Republican groups. It's just like those old protests against the Iraq War where the marches were organized by extreme groups like International ANSWER without participants knowing about it. True grassroots events of late have been few. In many cases, a sincere public is being manipulated by very organized groups.

Every new federal agency becomes a permanent fixture, never to be disbanded. Every entitlement and social program will never be repealed no matter how bankrupt.

Behold the real problem in American politics: corruption and ossification. The rest of the developed world ought to serve as proof that the welfare state does work, though it requires flexibility, constant reevaluation of programs, and relatively honest functionaries. The Tea Party folks are foolishly desiring an end to the government as a principle, when they ought to be electing better politicians who might bring a successful political culture into Washington.

Though American by origin, I've lived in Finland for some years. From this vantage point, the entire Tea Party platform seems based on ignorance. Working towards a smaller government? No, you won't progress towards a higher standard of living without a stronger welfare state. (For all the supposed higher taxes of Nordic Europe, I have more spending money left over at the end of the month than I ever did in the US, and families here typically own two homes.)

Re:Government is Clueless about Business (1)

niales (1147987) | more than 4 years ago | (#31823728)

1) Our elected representative pushing policies we do not agree with is NOTHING like what caused the original Tea Party.

2) A general lack of understanding in the Party. All party's have fools who spout rhetoric, but I've yet to hear a thought out position from a Tea Partier.

Perhaps it's all media coverage, but their general strong support for Palin makes that hard to believe.

Re:Government is Clueless about Business (1, Flamebait)

Amasuriel (1176527) | more than 4 years ago | (#31823810)

As long as you consider Glenn Beck and other Fox personalities "the bottom" you could indeed classify the Tea Party as a bottom up group.

I'm also not sure what paragraph 3 has to do with what you are saying, though I agree with you on that at least. I think Politics as a whole would be well served by string laws punishing public slander that proves unfounded and anyone caught lying outright should have to bow out of whatever race they were in.

Re:Government is Clueless about Business (4, Insightful)

timeOday (582209) | more than 4 years ago | (#31823874)

Just curious, why does the Tea Party movement catch so much flak?

They're modern hippies... purely an opposition party with no realistic plan of their own, hoping to fix everything simply by tearing down solutions that have been developed (with good reason) over hundreds of years. It's a style of wishful thinking where flawed solutions to problems (such as social programs) are conveniently seen as the source of the problems themselves, giving the false impression of easy solutions.

The end of the Tea Party is when/if they actually get somebody elected and have to start making hard, divisive decisions.

Re:Government is Clueless about Business (0)

Anonymous Coward | more than 4 years ago | (#31823312)

Wow, someone drank to much Kool-Aid!

Re:Government is Clueless about Business (4, Insightful)

h4rr4r (612664) | more than 4 years ago | (#31822834)

This has nothing to do with that. It is just Lockheed belly-aching that they do not want to give up their sweet cost plus deals. The solution to this is to buy this service from Spac-X or another competitor.

Re:Government is Clueless about Business (1)

TooMuchToDo (882796) | more than 4 years ago | (#31823096)

+1. I'm not a fan of Elon Musk by any means (although I bought a Tesla Roadster), but buying launches from SpaceX would go a long way towards lowering launch costs.

Re:Government is Clueless about Business (1)

h4rr4r (612664) | more than 4 years ago | (#31823244)

If they ever make a car I could afford.(personal rule: can't afford car unless you can pay for it in cash) I will get one.

Re:Government is Clueless about Business (1)

TooMuchToDo (882796) | more than 4 years ago | (#31823366)

I'm sure they'll get there. Have to have those with deep pockets underwrite your R&D first though.

Re:Government is Clueless about Business (1)

h4rr4r (612664) | more than 4 years ago | (#31823468)

Thanks for doing that.
I understand why they are doing it, and think it is the right thing to do. I just am not willing to go into debt for any car and this is a car I could not afford with out debt.

Re:Government is Clueless about Business (4, Informative)

ZonkerWilliam (953437) | more than 4 years ago | (#31823034)

Working with the Feds I can honestly agree, the mentality is vastly different. From perspectives of a federal agency, they submit a request for more funding if they need it, usually they get it (meaning, usually, a tax hike). What kills me is the way the whole funding is setup, if you don't spend all your funding you have to send it back, and next year you get reduced funding. So... all the agencies are motivated to spend all the cash on unneeded equipment at the end of the fiscal year just so they can get the same amount of money next fiscal year. So this tells us that basically Government is structured to waste money.

Re:Government is Clueless about Business (4, Informative)

Runaway1956 (1322357) | more than 4 years ago | (#31823390)

From experience in the Navy, I can verify the fiscal thing. Each quarter, we would "purchase" things out of our own storerooms, so that the books balanced within a couple of dollars. Across the board, we did this. The galley (or kitchen, for you landlubbers), office supplies, paint, you name it. The money had to be spent, or lost. At the end of the fiscal year, same thing. Spend right down to the very last dollar, never turn money in, or the next year your budget would shrink.

Damn shame that things work that way. It's an incentive to waste.

Re:Government is Clueless about Business (2, Funny)

Anonymous Coward | more than 4 years ago | (#31823418)

There is an easy solution to the problem of government budgets. Amongst male administrators of any sort, public or private, budget size is a surrogate for penis length, while staff size is a surrogate for penis girth. Obviously most male administrators suffer from feelings of inadequacy and constantly wish to increase the size and girth of their penis-surrogate. At this point, the solution should be obvious to all: hire only men with monster horse-cocks. They understand full well how painful it is for us to fit that thing into our tight little budget. They have no need for a big surrogate, they've got the real thing.

I'm sure some feminists will claim this is proof we should hire women as administrators, and to them I will just say, ladies, I've got a real big budget and a huge staff for you, right here.

want NASA to foot the bill (4, Informative)

confused one (671304) | more than 4 years ago | (#31822642)

For those who don't RTFA: ULA said the cost to upgrade the basic Atlas V to meet manned spaceflight would be $400M. They also said that if you want to build a heavy lift Atlas or Delta to manned spaceflight spec it would cost between $1B and $2B. And they want NASA to pay all the cost, up front.

Re:want NASA to foot the bill (1)

ducomputergeek (595742) | more than 4 years ago | (#31822804)

WTF. We were blasting people into space on the Atlas 50 years ago. I know the Atlas V is a different vehicle, but hell, the Atlas was a modified ICBM. How much does it cost to redesign the payload platform on the DIVH or Atlas V?

Re:want NASA to foot the bill (2, Interesting)

cheesybagel (670288) | more than 4 years ago | (#31823576)

Very little. Basically its a software change, to modify the rocket trajectory, and launch pad modifications so astronauts can actually enter the capsule on top of the rocket. Of course this may change if NASA insists on putting a lot of red tape around it.

Re:want NASA to foot the bill (4, Insightful)

rsgeek (1788532) | more than 4 years ago | (#31822824)

This makes sense, though, from a business perspective. NASA isn't exactly a "reliable" customer, so if they want a new capability and won't guarantee future use of it, why shouldn't NASA be the one to pay for it?

Tell you what... Go to a car dealer, tell them you want a custom model built to your exact specifications from scratch and that you won't pay a dime until it's delivered. Tell me how far you get with that...

Re:want NASA to foot the bill (1)

h4rr4r (612664) | more than 4 years ago | (#31822898)

Except when the guy in the next state is already doing it cheap, why not buy from him?

Why not save the taxpayers dollars and buy from the Russians or ESA?

Re:want NASA to foot the bill (1)

cheesybagel (670288) | more than 4 years ago | (#31823600)

NASA has bought flights from Russia for years already.

Re:want NASA to foot the bill (1)

anarche (1525323) | more than 4 years ago | (#31823678)

Mod parent up, this seems to be the most insightful reading of TFA on the forum.

Re:want NASA to foot the bill (3, Interesting)

PolygamousRanchKid (1290638) | more than 4 years ago | (#31822826)

They also said that if you want to build a heavy lift Atlas or Delta to manned spaceflight spec it would cost between $1B and $2B. And they want NASA to pay all the cost, up front.

So they actually *know* that it will cost more like $10B, and will be able to squeeze the rest out of NASA as "cost overruns" on the initial contract bid.

Who's calling Tony Soprano a gangster?

"How much dat cost?"

"How much ya got?"

This is one of the "fine arts" or "black magic" of bidding on government tenders . . . finding out how much they really have to spend. Not just what they claim in public testimony.

Both Boeing and Lockheed Martin understand and know how to make money in this business.

They are not sure yet how they will make money in the commercial market. But if they figure it out, they will be back in it . . . real soon!

Re:want NASA to foot the bill (3, Insightful)

Nyeerrmm (940927) | more than 4 years ago | (#31823136)

Since the proposed FY2011 NASA budget has about $6B allocated for helping fund the development of these new vehicles.... it sounds like they're going to get exactly what they're asking for. I'm not sure I see what the problem is.

They just have to compete for the money like everyone else (their experience should help there,) and they'll need to be more careful with their budget, since the whole idea is to eliminate the cost-plus contracts that allows them to lowball their estimate and ask for more money later.

What, the giant government contractor... (4, Insightful)

Omnifarious (11933) | more than 4 years ago | (#31822704)

What, the giant government contractor doesn't want to compete? What a surprise. I guess without making things overly expensive, budget overruns and miles of red tape they just can't get enough money from the public trough.

I see this as a complete vindication of this plan. IMHO, Lockheed Martin and companies like them are some of the worst crooks our government (and by extension, all of us) does business with. There's no crook like the one that does it legally.

How to tell (1)

AnonymousClown (1788472) | more than 4 years ago | (#31822710)

"When you start getting into a heavier crew transfer vehicle and a dedicated launch facility, it's over a billion dollars, but less than two," Mr. Gass said. Those improvements "should be funded by the U.S. government" without additional investment from Boeing and Lockheed, he said.

Here's one of those times where I find it hard to tell if he's not thinking "outside the box" or if he understands the business better than the upstarts. In other words, does he know something from experience that the upstarts don't or do the upstarts know something that this guy never considered?

Re:How to tell (1)

Brett Buck (811747) | more than 4 years ago | (#31822738)

Yes, they do know something the startups don't - how difficult it actually is.

        Brett

Re:How to tell (1)

h4rr4r (612664) | more than 4 years ago | (#31822846)

The russkies are doing it pretty cheap. Buy from them if we have too. No point in paying to develop it and to buy it. In that case you may as well do it all in house and not have the shareholders get their rake.

Re:How to tell (1)

HarrySquatter (1698416) | more than 4 years ago | (#31822892)

The russkies are doing it pretty cheap.

That's because they are getting hefty subsidies.

Re:How to tell (2, Funny)

h4rr4r (612664) | more than 4 years ago | (#31823084)

Sounds like we should be letting them bleed themselves dry. If they want to give us a massive discount, no skin off our noses.

Re:How to tell (2, Insightful)

georgewilliamherbert (211790) | more than 4 years ago | (#31822858)

To some extent this is true - SpaceX has spent about 2x what they thought they would to a given point in their development program, though they're still liquid and moving forwards at good pace. A number of startups have spent tens of millions of dollars and not flown.

However - Two startup companies and an independent team combined spent 1/10 of the cost of the DOD / NASA DC-X / DC-XA program to fly in the X-Prize Lunar Lander cup competition, which was a comparable technical challenge and vehicle performance specification. And DC-X was widely hailed for having come in at 1/5 of the price that competitors (Of McDonnell Douglas, who actually built and flew it for DOD) said it would cost.

There were teams at large companies that were asked to quote an equivalent vehicle to Burt Rutan / Scaled Composites' SpaceShip One, and came up with numbers 8-15 times larger than it took Burt to build and fly and win the main X-prize.

Perhaps the large companies don't know how easy it can be. Evidence is that some startups are succeeding reliably, and by comparison extremely cheaply, albeit slowly. There's a lesson there, too.

Re:How to tell (3, Insightful)

causality (777677) | more than 4 years ago | (#31823362)

To some extent this is true - SpaceX has spent about 2x what they thought they would to a given point in their development program, though they're still liquid and moving forwards at good pace. A number of startups have spent tens of millions of dollars and not flown.

You'd think that after having this consistently happen over and over and over again, maybe they'd revise the way they perform cost estimates? Y'know, so as not to be surprised by these things. It's like making the same mistake time after time and never learning. When an individual repeatedly does this, don't they call it a learning disability?

space leery of becoming corepirate nazi product (0)

Anonymous Coward | more than 4 years ago | (#31822718)

look what they've done to this place.

never a better time to consult with/trust in your creators. giving away time, space & circumstance since/until forever. see you there?

fish tanks (2, Funny)

ruin20 (1242396) | more than 4 years ago | (#31822762)

Bigelow Aerospace is likely out there to put the mile high club to shame. the owner cleans fish tanks as a second job.

Roland Piquepaille (0)

Anonymous Coward | more than 4 years ago | (#31823168)

This story is from Roland Piquepaille (from the grave)...

10 years + $20B and someone else gets elected (4, Insightful)

RichMan (8097) | more than 4 years ago | (#31822782)

Cash up front is the only way to get corporations to commit to this. The government is too likely to pull a "that costs to much" about turn and leave the company holding the debt.
--
I don't see private companies betting big on long term government contracts. The commitment is just to large and the sleazy government turnarounds just to likely.

Imagine being a company and investing $20B and 10 years of real effort into something expecting a big payout of years of ferrying astronauts into space. Then someone else gets elected and NASA changes it plans. Kiss your $20B good bye.

See Northrop F20/F5G. It even had a politically correct name.
---
Much of the F-20's development was carried out as part of a U.S. Department of Defense (DoD) project called "FX", which intended to sell less-advanced fighter designs to U.S. allies to limit the possibility of front-line U.S. technology falling into Soviet hands. FX developed out of a general re-working of U.S. military export policy started under the Carter administration in 1977. Although Northrop had high hopes for the F-20 in the international market, changes in policy following Ronald Reagan's election left the F-20 competing for sales with front line fighters like the F-16. The development program was eventually abandoned in 1986 after three prototypes had been built and a fourth partially completed.[1]
--
(congressional hearing!!)
Thomas V. Jones, Northrop's CEO, stated that there was little point in having companies develop aircraft on their own if they were utterly reliant on the government to sell them. He suggested that the entire FX concept be dropped, and Northrop be allowed to sell the F-20 on the market like any other vendor.[41]
---

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31822880)

Then the government might as well do it all in house so that no profit has to be made and given to shareholders. No point in wasting tax money to make some investor rich.

Re:10 years + $20B and someone else gets elected (1)

ThreeE (786934) | more than 4 years ago | (#31822938)

Brilliant! Using this logic the government might as well do everything.

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823054)

Only if it cannot buy services like the rest of us.
I am not required to pay the garbage collector a fee for designing a new truck, ups does not ask me to pay for design of packages. NASA should buy services, this would be a delivery service. Lockheed just wants to keep running their cost plus scams.

This should be like UPS. The service provider takes the package to the ISS for $X, their bid. If they cannot, give the money back and we can find someone else to do it.

Re:10 years + $20B and someone else gets elected (2, Insightful)

ThreeE (786934) | more than 4 years ago | (#31823214)

Your original post seemed to indicate that the government has a zero cost of capital -- which is what profit pays for in private businesses. This is simply not true. The US Governments either has to print money, borrow it, or confiscate it from citizens. If they print it, the cost is paid via by devaluing our dollars. If they borrow it, we eventually pay interest. If they confiscate it, we pay for it directly. This is no different than paying the contractor profit. Profit is not evil.

Your second post changes the subject. Now you suggest a different type of contracting approach -- from cost plus to fixed fee. True, this is a different incentive, but the contractor is still making a profit. Good contractors will charge more for a fixed fee vs. cost plus contract due to the higher risk -- all other factors being equal.

The bottom line is that the government is a terribly inefficient way to do anything. They simply have no motivation to provide value -- it is always someone else's money.

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823630)

I never suggested profit was evil, merely that is is waste. Which is why commodity items have such little profit on them, they must compete on price and cannot have much waste.

Taxes are not confiscation, they are the price for society. If this price is too high seek another society that is cheaper to purchase. Somalia should be quite nice in that respect.

I never changed the subject I merely clarified my point.

Fixed fee contracts may indeed receive higher quotes, but they prevent the 1B rocket turning into a 20B rocket later.

  If you are paying for the cost of development and the cost of implementation is it normally cheaper to do it in house. You get savings by sharing development and implementation costs with other purchasers for normal externally purchased goods and services.

Re:10 years + $20B and someone else gets elected (1)

ThreeE (786934) | more than 4 years ago | (#31823780)

You again expand your point into new areas. I'll pick a few of your new topics to respond to.

Taxes are confiscation. If you don't pay them, they will be taken from you forcibly. We allow our government the monopoly of force in exchange for limited powers.

Somalia: I assume you bring this lawless state up as an example of a capitalism gone bad. Capitalism is an economic system where every exchange is consensual. Lawless Somalia is the opposite of this. So surely I must misunderstand your point.

On cost plus vs. fixed fee contracts we agree. Fixed fee contracts are better. Unfortunately, the risk is often too high for some projects to lead to any serious fixed fee bids.

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823926)

You can leave rather than pay taxes, you actively choose to pay them by staying.

Somalia is not capitalism gone bad, it is a libertarian paradise. No government interference, thriving sea based industry including a stock market for it, a wonderland only possible without taxation.

And again, I am using expansion to provide more clarity.

In the case of no bids for a fixed fee contract, then another method should be used. Including reducing the scope of projects.

Re:10 years + $20B and someone else gets elected (2, Insightful)

TooMuchToDo (882796) | more than 4 years ago | (#31823150)

Then the government might as well do it all in house so that no profit has to be made and given to shareholders. No point in wasting tax money to make some investor rich.

Have you ever seen how the government works "in house" on projects? I've seen the DOE flush tens of millions down the drain that a private company would've spent *much* more efficiently. No, the government is best to let a commercial venture handle things, just not cost plus.

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823300)

Medicare has very low overheads, with the right folks other government offices could do as well.

I honestly would prefer a private business doing this, but with cost plus contracts the government might as well do it in house.

What's wrong with cost plus? (1)

mosb1000 (710161) | more than 4 years ago | (#31823606)

What is everyone's beef with cost plus? You have to pay the costs, of course, because you can't seriously expect a company to work for you at a loss, and you have to give them a plus so that they will work on your project instead of something else. It's common sense. Am I missing something? What's the alternative? Do you pay for services you receive some other way?

Re:What's wrong with cost plus? (3, Informative)

h4rr4r (612664) | more than 4 years ago | (#31823788)

The alternative is the producer puts in a quote and is stuck with it. If they fail to produce for that, then you get your money back.

I do not pay the costs of USPs truck breaking down when they deliver a package to me. They lose money on that delivery and make it up on the aggregate.

If you make a bid and it is too little, too fucking bad. Cost plus allows these companies to bid far lower than they know it will cost to produce these things and then jack the price up later.

Re:10 years + $20B and someone else gets elected (1)

Rakishi (759894) | more than 4 years ago | (#31823752)

Yes medicare...The program that outsource everything except the very top functions to private companies. Private hospitals, private billing, private fraud investigation, private doctors, private pharmaceutical companies and basically private everything of any real consequence. You know, exactly what NASA is doing? So what was your point again?

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823942)

That they make it work without cost plus contracts?

Re:10 years + $20B and someone else gets elected (1)

sixsixtysix (1110135) | more than 4 years ago | (#31823880)

not just here, though. the entire military industrial complex welfare system needs to go, too.

Re:10 years + $20B and someone else gets elected (1)

afidel (530433) | more than 4 years ago | (#31822984)

You can do it with contracts that pay for milestones and have big backout penalties. That's the way Constellation was done and one of the reasons it's going to cost a couple Billion to get nothing. It's probably closer to a fair system than either cash upfront or pay when it's finished.

Re:10 years + $20B and someone else gets elected (1)

vlm (69642) | more than 4 years ago | (#31823030)

which intended to sell less-advanced fighter designs to U.S. allies to limit the possibility of front-line U.S. technology falling into Soviet hands

It wasn't necessarily less advanced, it was just slightly lower performance and not quite as export controlled.

It turns out to cost almost as much money to develop and manufacture a new 90% cutting edge fighter as a 100% cutting edge fighter.

Once folks were allowed to select from either, at about the same cost, the F-5 went bye bye.

The whole situation was just a reaction to the Iranian Shah's airforce, which had some pretty nice (for the time) aircraft.

Re:10 years + $20B and someone else gets elected (1)

h4rr4r (612664) | more than 4 years ago | (#31823154)

Why did they not just make an F-16-Light.
Give it crappier engines, make the mounting non-compatible, different computers, etc. Seems like that would have been way cheaper.

Re:10 years + $20B and someone else gets elected (1)

cheesybagel (670288) | more than 4 years ago | (#31823722)

There are several F-16 models. Some countries buy the cheaper ones, others the more expensive versions. Also F-16 was by General Dynamics, I think it was the F-18 (well YF-17 actually) that was Northrop.

Re:10 years + $20B and someone else gets elected (1)

anarche (1525323) | more than 4 years ago | (#31823742)

You know this whole situation is going on again right now.

The JSF is being built at the same cost (or frikken more) as the F22 with lower end tech to be sold to allies (where the F22 is under high-end tech restrictions).

Guess which one is going to be chosen by the USAF to buy?

Re:10 years + $20B and someone else gets elected (1)

QuantumRiff (120817) | more than 4 years ago | (#31823082)

Actaully, I think the best way to get companies to commit is not cash up front, but pre-buying the first X flights.. as in, were going to pay you $100 Million per launch. Here is money up front for our first 10 launches: $1Billion. our first flight starts in 4 years, and then every 6 months afterwards. Every missed flight, you owe us back the money, or a credit on the next launch (can only add a credit once, and you have to pay us interest on that credit)

Re:10 years + $20B and someone else gets elected (1)

dAzED1 (33635) | more than 4 years ago | (#31823768)

that's twice as much per launch than what they can pay the soviets.

Re:10 years + $20B and someone else gets elected (1)

DerekLyons (302214) | more than 4 years ago | (#31823414)

Cash up front is the only way to get corporations to commit to this. The government is too likely to pull a "that costs to much" about turn and leave the company holding the debt. Imagine being a company and investing $20B and 10 years of real effort into something expecting a big payout of years of ferrying astronauts into space. Then someone else gets elected and NASA changes it plans. Kiss your $20B good bye.

Um, no. Typically contracts of this nature are 'pay as you go' and the government is responsible for paying penalties and closing out costs if they terminate prior to the contract running out.
 

See Northrop F20/F5G.

That's a bit more complicated than you make out. Northrup was paid upfront for the the development work - where they lost money was on their side project to sell the aircraft independently.

Thanks America! (2, Funny)

Psiren (6145) | more than 4 years ago | (#31822842)

A big thank you to America (and yes, Russia too) for getting us started on this whole space thingamajig. I think Europe and Asia can take over now. So long, and thanks for all the fish!

Re:Thanks America! (1)

Diagoras (859063) | more than 4 years ago | (#31823270)

A big thank you to America (and yes, Russia too) for getting us started on this whole space thingamajig. I think Europe and Asia can take over now. So long, and thanks for all the fish!

Europe - Let's talk when you're able to launch people into space.

Asia - This isn't a country, or even a loose confederacy. If you mean Japan, see above. If you mean China, then I'll be more impressed when you do something post 1965 that isn't bought from the Russians.

Re:Thanks America! (1)

cheesybagel (670288) | more than 4 years ago | (#31823794)

Well the first Soyuz capsule was launched later than 1965 (although not far from it) and it failed (i.e. the guy in it died). In comparison the Chinese were a lot more successful. Hey the Chinese are soon going to do the Salyut program, so all is well...

ROFL (1)

Idiomatick (976696) | more than 4 years ago | (#31822862)

"what business there was went to European and Russian rockets that were cheaper"
They might need some business classes......

Man up, pussies! (1)

HeckRuler (1369601) | more than 4 years ago | (#31822894)

I double-dog-dare you to go make a buck in space

Re:Man up, pussies! (2, Insightful)

Wyatt Earp (1029) | more than 4 years ago | (#31822916)

DirectTV seems to make money in space.

Re:Man up, pussies! (0)

Anonymous Coward | more than 4 years ago | (#31823692)

you should check out spacex if you want.... they are doing it with a huge back log now. Or how about orbital sciences? As someone who buys rockets and satellites, I can tell you Lockheed and Boeing are completely non-competitive, as they say it, the government backs up semi's with cash whenever they need it, why deal with a commercial entity? Remember, they are in the business of selling man hours to the government. What is being built is non-relevant.

Translation: (1)

carlhaagen (1021273) | more than 4 years ago | (#31822932)

"We're skeptical about this whole thing with colonizing the rest of the solar system. We think it's just a gimmick." Jackasses.

There Is Another... (1)

LifesABeach (234436) | more than 4 years ago | (#31822950)

Has anyone asked Burt Rutan [wikipedia.org] how much he would charge to put a Pay Load on the Moon?

Obvious really (0)

Anonymous Coward | more than 4 years ago | (#31823012)

Big capitalist compaines just arn't as efficient as socialised government programes...

Cue the neo-liberal rage in 3..2..1..

The reason American companies can't compete (0)

Anonymous Coward | more than 4 years ago | (#31823028)

ITAR [wikipedia.org] prevents us based companies from being competitive with Asian and European ones. This restricts all aspects of space technologies, from the smallest IC chip to the largest vehicle, and prevents non US persons from working on our projects.

Mars (2, Insightful)

charliemopps11 (1606697) | more than 4 years ago | (#31823282)

How much is Mars worth? Because that's what we're giving up. We are literally a couple of decades away from being able to put people on Mars. By giving up now, which is exactly what we are doing, we are basically giving the entire planet to whichever government decides it's worth the investment. And we all know that governments going to be China. Yea, there's a space treaty... but we all know whomever gets their first gets to decide the rules ahead of time for everyone else. Space exploration isn't profitable yet, and isn't going to be for a long time. That doesn't mean we shouldn't do it.

Bigelow Aerospace?! (1)

mr_3ntropy (969223) | more than 4 years ago | (#31823294)

What the Deuce?!

Debate will soon be over (0, Flamebait)

amightywind (691887) | more than 4 years ago | (#31823346)

This silly debate will be over in May when Falcon 9 crashes in the Atlantic. Interesting that the first flight was moved from mid-April to mid-May to make room for Obama. It will take some selling, As America is opposed to this reckless 'plan'.

Re:Debate will soon be over (1)

h4rr4r (612664) | more than 4 years ago | (#31823684)

Space-X does not view this launch as critical. This is just another step, on the way to COTS space launch.

You realize that all rocket development has had these issues right?

"Skeptical of Commercial Space Market " (0, Troll)

Un pobre guey (593801) | more than 4 years ago | (#31823356)

Skeptical of Commercial Space Market

Har. That's because there isn't one . All those dweeby weenies who think the contrary are little more than sci fi space-adventure magical-religious cultists. In more than a few ways not unlike Scientologists or Jehovah's Witnesses, I might add.

Re:"Skeptical of Commercial Space Market " (1)

Daniel Dvorkin (106857) | more than 4 years ago | (#31823714)

You've posted nearly the exact same comment on every space-related /. story for the last several months. Do you have anything at all to contribute to the debate, or are you here solely to throw insults around?

Re:"Skeptical of Commercial Space Market " (2, Interesting)

Un pobre guey (593801) | more than 4 years ago | (#31823964)

I am here to 1) throw insults around (this is slashdot, after all), and 2) stop wasting tax dollars and incurring debt to subsidize corrupt defense contractors. Since you have taken the time to look at my previous posts (thank you, BTW, you have all my respect for it), you also know that I am a staunch advocate of unmanned space exploration. This particular debate is implicitly about manned space exploration, which to my mind is worthless and unjustifiable.

Here on slashdot I am in a small minority that typically gets modded down into oblivion very quickly. I am surprised my post lasted long enough to receive your attention.

Still not sure what the business case for space is (2, Insightful)

lennier (44736) | more than 4 years ago | (#31823504)

As far as I can see there are a very few actual uses for space:

1. Satellite communications
2. Military
3. Tourism
4. SCIENCE! (let's count the number of planets around stars that we will never be able to get to because of relativity! like angels and pinheads except we can fit curves to it)

and of those four, military and SCIENCE! are basically big money pits which achieve nothing but international prestige (and ICBMs actively endanger all life on earth), tourism is a brief entertainment for the idle rich, and satellite data communications is the only thing which actually contributes to the health and wellbeing of Earth. So yay one out of four, I guess.

Haven't we basically 'done the space thing' by now? Moonbases didn't work out, we're practically speaking not going to colonise Mars let alone Jupiter because of the radiation problems, so... ... why DO we need manned lifters? There's nothing out there to send people to, and even if we send people to nowhere there still won't be anything for them to send back.

What's the big point of the Space Future, again? If we had warp drive or canals on Mars it would be different, but in our universe....?

Re:Still not sure what the business case for space (0)

Anonymous Coward | more than 4 years ago | (#31823774)

Haven't we basically 'done the space thing' by now? Moonbases didn't work out, we're practically speaking not going to colonise Mars let alone Jupiter because of the radiation problems, so... ... why DO we need manned lifters? There's nothing out there to send people to, and even if we send people to nowhere there still won't be anything for them to send back.

What's the big point of the Space Future, again? If we had warp drive or canals on Mars it would be different, but in our universe....?

That is the most terrible view on space and science in general I've ever seen. How the hell is this insightful? Inciteful maybe.

"Guys, it hasn't worked yet so let's quit. It seems useless."

Just because we haven't figured out moonbases and the radiation problem yet (seems to be progressing alright), doesn't mean we'll never figure them out one day. Of course, if we gave up working on it then definitely we'd never solve those problems.

The main point of space is that we get off this rock of incredibly limited resources and land to get to another planet to live on/harvest. All that other stuff is just ways to get to that point.

Hell, would you have said 50 years ago "Hey, aren't we fine with agriculture now? We've got enough food and the farmers are doing fine so why invest into more agricultural resources? All they're doing is wasting money and building up food we throw away so let's end that.

What's the point of agricultural study, again? If we had food that made you not sick or worldspread hunger it would be different, but in our universe...?"

And hey! After 50 years we've got both food chock full of vitamins and minerals to boost immunity along with widespread world hunger. And y'know what? Those techniques used to create large, more nutritious amounts of food that you might've thought we didn't need can be used in space when we start trying terraforming or if we create colony ships.

Oh Science, is there anything that you make that's absolutely useless?

Re:Still not sure what the business case for space (2, Interesting)

anarche (1525323) | more than 4 years ago | (#31823820)

What's the big point of the Space Future, again? If we had warp drive or canals on Mars it would be different, but in our universe....?

Um. To ensure the continued survival of the human race by ensuring we have a fallback for when Mother Earth become unsuitable for life/eaten by the sun/hit be a meteorite/Mormon

Of course, if you aren't interested in the future of the human race, I'd love to understand the basis of your morality, while I murder your children.

Re:Still not sure what the business case for space (1)

sixsixtysix (1110135) | more than 4 years ago | (#31823920)

^^ this. how much of this money would be better spent elsewhere or not at all? at least come up with this generations velcro or tang already.

What happened to SpaceX (4, Interesting)

jfruhlinger (470035) | more than 4 years ago | (#31823534)

I read that article this morning and was baffled to hear SpaceX mentioned nowhere in it, considering they have a Progress/ATV-type unmanned cargo vessel on the launchpad at Cape Canaveral and plans to build a man-rated capsule in the next 2-3 years. Have they imploded recently or something?

Why must we drag ourselves into the future? (0)

Anonymous Coward | more than 4 years ago | (#31823738)

With last weeks launch of the iPad, it is clear that at least 1 tech. company will drag everyone else, kicking and screaming, into the future.

Leaving your fanboi'sm, or Apple is evil mantra behind for a minute, why has the mentality of 'dare to dream' , become such a taboo behavior in the information age? I'm not talking about just the tech. sector here, I'm talking about every industry that exists. With this article, it's LEO launch rockets, commercial and private funding. Last year it was the bailouts and the banking industry. I do not understand why, for all intensive purposes, future endeavors are perceived around static business frameworks. We do not live in a static environment, either naturally, or imaginary (referring to markets..). Every facet of our existence is constantly changing, yet we presently do everything in our power to resist that. Have we become so lazy and decadent that the rate for which we could, and should progress, has stagnated simply because it can? Say what you want about economic theory, capitalism, and profit, but I'd like to know what exactly western society has against full-scale technological and social progress?

I, an average citizen, should be able to take a trip to the moon by now. I know it, and you know it. What the hell are we waiting for?

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