Space Launch Context

Recently, and by recently I mean months ago by the time this post goes live (which is the disadvantage of scheduling them so far in advance), the Wall Street Journal published an article describing SpaceX as a near monopoly.  The piece is another example of the Journal’s discomfiting tendency to publish poor quality analysis of technical topics, but stood out to me because of the cherry-picking that had to be done to achieve the analysis and conclusions they documented.  This is not merely technical understanding that is lacking, but lazy or deliberately misleading market and industry analysis, which are precisely for what WSJ is supposed to be known.

I am far from an Elon Musk flunky, and I don’t have the romantic view of SpaceX that some in the industry maintain, but anyone who has followed the business of space launch since SpaceX entered the business would be hard-pressed to argue that they have not been a boon; quite simply, there wasn’t a space launch business before SpaceX.  United Launch Alliance (ULA) was a government-forced merger of Lockheed Martin’s and Boeing’s space launch businesses, ordered by the DoD to preserve access to space because neither business was profitable.  Before SpaceX, launching with the Boeing or Lockheed sides of ULA was your only option for American access to space, and the government was an almost exclusive customer keeping that business operating.

Enter SpaceX with the Falcon 9 launch vehicle, which undercut ULA’s launch costs by nearly two thirds and offered faster turn-around and innovative launch paradigms.  Ride-share existed before, but it was SpaceX that made it a viable target for even small university and private company projects.  Coinciding with the computational advances necessary for the rise of CubeSats, the Falcon 9 and SpaceX as a whole were absolutely integral to there being a thriving commercial space industry today.  Furthermore, SpaceX was and is willing to innovate in ways that ULA is not: they developed the first American-designed and manufactured rocket engine since the 1980s, the Merlin, which was an enormous advance over previous engines; they pioneered rocket reusability to increase the pace of launch far beyond what traditional providers could accommodate, to the point that the government remains the limiting factor to more space launches from US space ports at Vandenberg and the Cape; they developed innovative fueling and vehicle integration techniques that are faster, safer, and more efficient than the old paradigms.

By proving that there is a viable, profitable commercial market for space launch, SpaceX enabled a slew of other private space launch companies.  They are far from the only player in town, even if the other big-name players, like Blue Origins and Virgin Galactic, have not attained nearly SpaceX’s level of success.  Rocket Labs, for instance, routinely launches small payloads to LEO and is developing a GEO-capable vehicle.  ULA remains a player, mostly because certain government organizations continue to pay extra for the greater “reliability” of their legacy vehicles.  Other, more imaginative launch efforts are underway, thanks to the presence of a demand that no one predicted before SpaceX demonstrated it.

To claim that SpaceX is increasing launch costs, as the Journal article claims, requires cherry-picking data over a short time period, without looking at the overall impact they’ve had on launch costs – again, undercutting the traditional players in the space launch business by almost two thirds.  Claiming that they are a “de facto monopoly” because other big-name players remain unable to effectively compete with them both misunderstands the meaning of calling something a monopoly, and ignores numerous smaller players that do compete effectively with SpaceX on price and capability for certain segments of the space market.  As for the concerns around vertical integration which the article raises, with SpaceX able to launch its own satellites for Starlink and thus save on launch costs, it mistakes business success with business malpractice.  First, space launch is a fairly low-margin business to begin with, so SpaceX still must pay the significant material, engineering, and other costs associated with launch even if they are launching on their own rockets.  Second, by operating a successful commercial space business outside of launch, SpaceX is more likely to be able to continue providing low-cost, effective space access, and to innovate further to continue improving access to space.  They are a boon to national security, not a bane, because they alone keep the US space access competitive with the pace of launch coming out of China. As for manned spaceflight, SpaceX’s project began as a backup to Boeing’s Starliner, which remains on contract despite having yet to fly successfully, being preposterously over budget and behind schedule, and costing far more to launch and operate than SpaceX’s Dragon.

None of this analysis requires any deep research or intricate understanding of rocket science to achieve, which is why it is so concerning that WSJ should have failed to make these connections.  I prefer to think that the authors were simply lazy, and were not deliberately presenting a distorted picture in order to achieve some political objective or to mislead people because of a distaste for Elon Musk that has suddenly become in-vogue.  SpaceX is not a perfect company – no company is a perfect company – but they have been an enormous boon for the space industry as a whole, and revolutionary for space launch.  Then again, that probably doesn’t make for a headline that will draw as many clicks.