Third-party liability insurance and space launches

This article discusses a number of issues related to the US commercial expendable launch vehicle (ELV) industry and government's role in ensuring its competitiveness, particularly third-party liability insurance for space launches. The author finds that the space insurance industry has become a major constraint on the commercial development of space. The future implications are considered of US government involvement with the launch services industry, initially through providing third-party insurance itself. The author concludes that, for a stable commercial ELV industry, it will be necessary for the USA either to establish fair-trade agreements with other space-capable nations, or to maintain a significant government involvement to support the industry.     

The private solution to the space transportation crisis

Confused and short-sighted decisions dominated by political expediency have been made about US space policy in the past 30 years. Overly large and ambitious systems have been chosen, resulting in today's crisis in space transportation. The history of commercial aircraft development offers an alternative example of producing in a range of sizes and capabilities for a wide variety of users, and shows that the space transport industry could benefit from applying the decision-making processes used in private enterprise. The authors examine strategies for privatization of space transportation and conclude that policy support for the commercial launch industry must be continued. NASA must be reoriented towards its basic research function, and more government services should be bought from the private sector.     

Exploration of CASC's Commercial Space

China's commercial space activities started from the launch of Asiasat-1 satellite by a LM-3 launch vehicle on April 7, 1990. As the leading force in China's space industry, CASC has been committed to commercial space for nearly 30 years. The article describes CASC's advantages and activities in commercial space sector, as well as outlook for CASC commercial space development. The author concludes CASC is willing to coordinate and cooperate with state-owned and private companies and will create a new pattern for commercial space, opening up a new industry for space development and achieving more splendid achievement.     

US government policy - the major factor shaping the international commercial space launch marketplace

In this Viewpoint — an edited version of a statement made to the US House Committee on Science's Subcommittee on Space and Aeronautics' hearing on ‘US launch strategy’ — the President of Arianespace, Inc analyses the overriding importance of US government policies and executive decisions on the shaping and behavior of the international market in commercial space launch services. Chief among these is the overruling of commercial imperatives by foreign policy and national security interests and the consequent regular intervention of the US government in launch decisions. The ability of Arianespace successfully to compete in a market severely distorted as a result of these interventions, including the encouragement of joint ventures between US and Russian or Ukrainian companies, is explained.     

The commercial challenge to Arianespace: the TCI affair

The question of how far rockets used for commercial launch services are subsidised by their respective governments remains highly topical. This article traces the history of the first legal challenge to be made on this basis by a US launch service provider against Arianespace, a case which also called into question the pricing of the Space Shuttle. The perceptions, deliberations and negotiations of both sides are traced and it is noted that their most important outcome was not settlement of the case itself but agreement to start serious consultations on defining ‘rules of the road’ regarding government support to the commercial launch industry.     

Chinese launch services A user's guide

This article describes aspects of the Chinese space programme of interest to potential users of Chinese commercial launch services. A brief history is included along with a review of the current licensing requirements of the US government. The rationale behind Aussat's choice of the Long March launch vehicle is presented as well as a brief comment on the likely future for Chinese launch services in the West.     

Observations on the evolution of satellite launch volume and cyclicality in the space industry

Satellites have been rightly described as the lifeblood of the entire space industry and the number of satellites ordered or launched per year is an important defining metric of the industry's level of activity, such that trends and variability in this volume have significant strategic impact on the space industry. Over the past 40+ years, hundreds of satellites have been launched every year. Thus an important dataset is available for time series analysis and identification of trends and cycles in the various markets of the space industry. This article reports findings of a study for which we collected data on over 6000 satellites launched since 1960 on a yearly basis. We grouped the satellites into three broad categories – defense and intelligence, science, and commercial satellites – and identified and discussed the main trends and cyclical patterns for each of these. Institutional customers (defense and intelligence, and science) accounted for over two-thirds of all satellites launched within our time period (1960–2008), and, in the 1960s and 1970s, they accounted for 90% and 73.5%, respectively. A fair conclusion from this data is that the space industry was enabled by, and grew because of the institutional customers, not commercial market forces. However, when the launch data is examined more closely, a growing influence of the commercial sector is noticeable. Over the past two decades communication satellites accounted for roughly half of all launches, thus reflecting an important shift in the space industry in which the commercial sector is playing an equal role (on a launch volume basis) to that of the institutional market. Cyclical patterns in the satellite launch volume over the past decade are separately discussed before we sum up with a conclusion.     

Commercial spaceports — a window of opportunity?

The feasibility of building commercial spaceports is being actively investigated in several countries. Potential benefits include boosting economic development and assisting the commercial launch industry. This report finds, however, that commercial spaceport development will probably not be capable of generating a large enough return on investment to attract private sector involvement without significant government assistance. It is also unlikely that the market for large launch vehicles will support spaceport development; however, small satellites may offer better prospects.     

The US–Europe technology gap in space transportation: the view from the USA

This paper examines the debate within the USA over how to meet the perceived competition from the successful European Ariane launcher and the loss of US market share for space launch services that it represented. In particular, it explores the origins of the 1983 Reagan Administration policy to turn over expendable launch vehicle production and operation to private industry. The Administration's other decisions to: (1) use the Space Shuttle to fly all government payloads, and (2) allow NASA to market Space Shuttle services commercially, conflicted with this commercialization policy. These policies effectively caused US industry to delay entry into the international competition for launch services until after the loss of the Space Shuttle Challenger in January 1986.     

Risk management in commercial launches

The article explores the way so-called legal space risks are managed in US commercial space transportation. Risk management in the space transportation field is a highly regulated process, thus allowing practically no possibility of deviating from the system stemming from such regulation. Such a system arises from the legislation, basically the Commercial Space Launch Act, and the agreements. This risk-management structure is characterized by the transfer of risks from the space launch provider to both the user and the government and by the ensuing launcher's limitation of liability.     

Developing new launch vehicle technology: The case for multi-national private sector cooperation

Space is now a global business, yet the cost of getting to space is still high. Developing new launch vehicles that are cheaper, safer, and more reliable is the key to both rapid commercial growth and to more and better government uses of space. However, the R&D process leading to new launch vehicles is expensive and technically challenging; the past 50 years have seen many government development programs, but no major technological breakthroughs. Perhaps, it is therefore time to think about other ways of developing new launch vehicles. The best expertise in this field resides primarily with private companies and is spread across many actors and nations. A consortium led by space firms might be a better approach to opening up space in the 21st century. Governments will have to develop new policies treating space as though it were a commercial industry, in particular, relaxing export trade restrictions wherever possible. Issues of dual-use may be outweighed by the rapidly growing widespread availability of launch capabilities. Since new launch vehicles will require large up-front R&D expenditures, government support will continue to be needed to supplement private capital funds. Contributions to this effort should be international. However, difficult it might be in today's security conscious environment to reorient government policy, doing so may offer the most efficient and successful way to break the technological and economic barriers to more reliable access to space.     

The 2010 US space policy: A view from Europe

The authors examine the principles, goals and guidelines in the new US NSP. While in general favourable to the overall direction of the policy, noting that Europe too has similar goals or, in some cases, should be adopting US ideas, they are sceptical about certain aspects, such as the greater emphasis on commercial partnerships with NASA and the continuing protectionist launch policy. Particular points of concern are the vagueness and lack of clear goals in the human spaceflight programme and the US position on space weaponization at the Conference on Disarmament. Nevertheless, they believe that a similar type of EU-wide policy should be developed by the European Commission.     

Mission success regulations,their effect on ELV launch success and the applicability to regulating commercial human spaceflight

As the human spaceflight industry grows the agencies charged with regulating that industry meet significant challenges. An improvement in launch success would improve the safety for the crew and passengers of a commercial human spaceflight. With respect to ELV launches, NASA's regulations over civil launches are mission success oriented while commercial launches regulated by the FAA-AST, the agency that will also be charged with human spaceflight, takes a more public safety oriented stance. A comparison of the launch success between civil and commercial launches is used to inform the decision on whether or not mission success would be an appropriate regulatory stance for the FAA-AST. The results show that there is no significant difference in launch success between civil and commercial ELV launches. Because of this and because the industry is wary of over regulation, there is indication that a mission success oriented stance might not be appropriate for regulating commercial human spaceflight.     

An inconvenient regulatory truth: Divergence in US and EU satellite export control policies on China

Since the early 1990s the USA has maintained export control sanctions against Chinese international commercial satellite launch services. In 1998 these sanctions were further strengthened, resulting in a de facto international embargo that is premised on ITAR export licenses. Since 1998 this de facto embargo has effectively prohibited China from launching Western commercial satellites of a sophisticated technological standard. Today, European commercial satellite manufacturers are positioned to fully benefit from ITAR-free technology investments, gaining access to Chinese launch services for the launch of commercial telecommunication satellites that are technologically comparable to US satellites. This article examines the policy implications for the USA in light of EU regulatory divergence and the impending return of China to the international commercial launch services market.     

The space risk and commercial space insurance

This article reviews the history of commercial space insurance and describes the relevant legal framework. It then describes the types of transactions that take place and analyses four categories of insurance: pre-launch, launch, in-orbit and re-entry. The recent difficulties of the space insurance industry are described, and the author offers several suggestions for the future.     

National subsidies in the international commercial launch market

The agreement by the USA and Cocom to allow the export of US-built satellites for launch on Chinese launchers raised the national subsidy issue. The international commercial launch market is multinational and highly competitive; launch suppliers have accused each other of being unfairly subsdized. Currently the US government is engaged in various negotiations to establish a ‘level playing field’. A clear study of the subsidy issue is essential. This article examines some of the charges and the current situation associated with each country and suggests a possible approach for the USA to remain competitive in the international commercial launch market.     

Soyuz in French Guiana: A strategic perspective

After a proposition from Russia to France, ESA agreed to see Soyuz rockets take off from French Guiana. From industry, to governments and agencies, many Russian and European actors were involved in this project and they all had different motives. It is therefore relevant to try to discern them so as to understand the rationale behind this cooperative endeavor. Soyuz's primary role is to consolidate Arianespace commercial position in the launching market and to bring activity and founding to a stagnating Russian space sector. With this decision Arianespace will have a full range of commercially available launchers with Soyuz completing the two European rockets Vega and Ariane V. But since Vega and Ariane must have the priority, there is a risk to see an insufficient launch rate for Soyuz, which would not satisfy the Russian partners. Commercial elements alone cannot justify the agreement. There is a larger strategic ambition behind. What is at stake is the future development of innovative launch systems. It is important for ESA to maintain an autonomous access to space and to maintain a dynamic and strong European propulsion industry. Cooperation with Russia can offer an increase of expandable rockets capabilities and can pave for the next generation of launch vehicles. Moreover, we can detect an interest in acquiring a system that has the potential for human space flight capacity. Finally, the decision to launch Soyuz from French Guiana was the conjunction of Russian and French national interests, which led to a complete redefinition of the relations between Europe and Russia. It is of strategic importance that we, Europeans, adapt to this evolution and understand the new place that Russia takes in our space sector.     

The USA and international competition in space transportation

This article discusses the crisis facing the USA in the formulation of its space transportation policy, within the context of its overall national space policy. The author examines developments in international space transportation from 1982 to 1992, and the failure of US policies to meet foreign commercial competition in space launches. Two goals have emerged from the US policy debate: to achieve assured access to space, and to reduce the costs of sending payloads to orbit. Both goals need to be faced within the context of a wider commitment by government and private industry to space investment.     

A space exploration strategy that promotes international and commercial participation

NASA has created a plan to implement the Flexible Path strategy, which utilizes a heavy lift launch vehicle to deliver crew and cargo to orbit. In this plan, NASA would develop much of the transportation architecture (launch vehicle, crew capsule, and in-space propulsion), leaving the other in-space elements open to commercial and international partnerships. This paper presents a space exploration strategy that reverses that philosophy, where commercial and international launch vehicles provide launch services. Utilizing a propellant depot to aggregate propellant on orbit, smaller launch vehicles are capable of delivering all of the mass necessary for space exploration. This strategy has benefits to the architecture in terms of cost, schedule, and reliability.     

The relevance of economic data in the decision-making process for orbital launch vehicle programs,a U.S. perspective

Over the past fifteen years, major U.S. initiatives for the development of new launch vehicles have been remarkably unsuccessful. The list is long: NLI, SLI, and X-33, not to mention several cancelled programs aimed at high speed airplanes (NASP, HSCT) which would share some similar technological problems.The economic aspects of these programs are equally as important to their success as are the technical aspects. In fact, by largely ignoring economic realities in the decisions to undertake these programs and in subsequent management decisions, space agencies (and their commercial partners) have inadvertently contributed to the eventual demise of these efforts.The transportation revolution that was envisaged by the promises of these programs has never occurred. Access to space is still very expensive; reliability of launch vehicles has remained constant over the years; and market demand has been relatively low, volatile and slow to develop. The changing international context of the industry (launching overcapacity, etc.) has also worked against the investment in new vehicles in the U.S. Today, unless there are unforeseen technical breakthroughs, orbital space access is likely to continue as it has been with high costs and market stagnation.Space exploration will require significant launching capabilities. The details of the future needs are not yet well defined. But, the question of the launch costs, the overall demand for vehicles, and the size and type of role that NASA will play in the overall launch market is likely to influence the industry. This paper will emphasize the lessons learned from the economic and management perspective from past launch programs, analyze the issues behind the demand for launches, and project the challenges that NASA will face as only one new customer in a very complex market situation. It will be important for NASA to make launch vehicle decisions based as much on economic considerations as it does on solving new technical challenges.