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Introduction: The View from the Mezzanine in Kent, Washington

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Financing the New Space Industry
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Abstract

The book opens with a description of the Blue Origin assembly bay and a description of the work that its founder, Jeff Bezos, is attempting to achieve. McCurdy identifies the central challenges faced by business firms like Blue Origin trying to establish a foothold in the space transportation field. Can such firms raise the funds needed to cover the high cost of space flight? Do they need government help to do it? Leaders of the new space movement want to be sufficiently free of government control to carry out their ideas, but typically need financial support from sources beyond traditional private investment channels. Those other sources include the government agencies from whose control the creators seek to break away.

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Notes

  1. 1.

    See Eric Berger, “Behind the curtain: Ars goes inside Blue Origin’s secretive rocket factory,” Ars Technica (March 9, 2016) <arstechnica.com> (accessed April 20, 2017). The author wishes to acknowledge the assistance of Roger D. Launius and Kristi A. Morgansen in reviewing the manuscript and making valuable suggestions.

  2. 2.

    See Howard E. McCurdy, Inside NASA: High Technology and Organizational Change in the U.S. Space Program. Baltimore: Johns Hopkins University Press, 1993; Thor Hogan, Mars Wars: The Rise and Fall of the Space Exploration Initiative. Washington, DC: NASA, 2007.

  3. 3.

    NASA originally planned to allocate $485 million to firms chosen to develop commercial resupply spacecraft, to assist with vehicle development—$500 million less 3 percent for program management. Agency officials called the initiative COTS (Commercial Orbital Transportation Services). In FY 2011, Congress augmented this amount by $288 million, producing a total available amount of $788 million. NASA allocated 7 percent for program management, leaving $733 million. Agency officials calculated that the participating industries invested $1 billion of their own funds. NASA, Commercial Orbiter Transportation Services: A New Era in Spaceflight, NASA/SP-2014-617, 2014: 36–37, 92, 95. In 2008, NASA officials awarded $3.5 billion for 20 resupply missions to the International Space Station to the prevailing finalists (Orbital Sciences Corporation and SpaceX). This program was called CRS (Commercial Resupply Services). NASA, Johnson Space Center, Press Release, NASA Seeks Proposals for Crew and Cargo Transportation to Orbit (January 18, 2006); NASA Contract Release C08-069, NASA Awards Space Station Commercial Resupply Services Contracts (December 23, 2008). To encourage commercial development of crewed spacecraft, NASA officials made a succession of awards. The first set of awards (CCDev 1, CCDev 2, CCiCap and CPC) distributed $1461 million, plus supplemental awards of $101 million not counted as original figures. These funds were spent on spacecraft development. In the second phase of the initiative (called CCtCap or Commercial Crew Transportation Capability), NASA officials promised to pay $6.8 billion to Boeing and SpaceX for up to 14 flights to the International Space Station, including at least one test flight. NASA, Commercial Crew Program – The Essentials, February 25, 2016 <www.nasa.gov/content/commercial-crew-program-the-essentials/> (accessed July 2, 2019); NASA, release 14-256, NASA Chooses American Companies to Transport U.S. Astronauts to International Space Station, September 16, 2014.

  4. 4.

    Additionally, the list of policies would include the Commercial Space Launch Act of 1984, amendments to the Act in 1988 and 2004, the Commercial Space Launch Competitiveness Act of 2015, and White House Space Policy Directives 1 (2017), 2 (2018) and 3 (2018).

  5. 5.

    Howard E. McCurdy, The Space Station Decision. Baltimore: Johns Hopkins University Press, 1990; The White House, Presidential Directive on National Space Policy, February 11, 1988; Report of the Space Shuttle Management Independent Review Team, Christopher Kraft, chair, February 1995; McCurdy, “Partnerships for Innovation – The X-33 VentureStar;” in NASA Spaceflight: A History of Innovation, Roger D. Launius and Howard E. McCurdy (coeditors). New York: Palgrave Macmillan, 2018; The White House, President George W. Bush, President Bush Announces New Vision for Space Exploration Program, remarks by the President on U.S. Space Policy, January 14, 2004.

  6. 6.

    See Lou Dobbs with H. P. Newquist, Space: The Next Business Frontier. Pocket Books, 2001.

  7. 7.

    Seth Borenstein, Space Shuttle Program Total Budget 1971–2012, March 11, 2010, spreadsheet in possession of author. The $10.1 billion development sum does not include the operational cost of the first four orbital test flights.

  8. 8.

    Irene Klotz, “Profile. John Mulholland, Vice President and Program Manager for Commercial Programs, Boeing Space Exploration,” SpaceNews (November 21, 2012).

  9. 9.

    See John Newhouse, The Sporty Game: The High Risk Competitive Business of Making and Selling Commercial Airliners. New York: Alfred A. Knopf, 1982.

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McCurdy, H.E. (2019). Introduction: The View from the Mezzanine in Kent, Washington. In: Financing the New Space Industry. Palgrave Studies in the History of Science and Technology. Palgrave Pivot, Cham. https://doi.org/10.1007/978-3-030-32292-2_1

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  • DOI: https://doi.org/10.1007/978-3-030-32292-2_1

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