Max Q: The Billionaire Space Race

Max Q: A Weekly Space Update from TechCrunch

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The Current Landscape of Space Ventures

A particularly ambitious competition is unfolding within the space sector, characterized by significant investment and expansive goals. Furthermore, a novel commercial launch company is emerging within the gaming industry.

Another enterprise is actively preparing for large-scale manufacturing operations. This indicates a growing trend toward establishing robust production capabilities for space-related technologies.

Starlink's Financial Outlook

Starlink, SpaceX’s satellite internet constellation, is focused on achieving financial sustainability. Its current objectives center around avoiding potential bankruptcy and securing long-term viability.

The company is striving to reach a point where its revenue consistently exceeds its expenses, ensuring continued operation and expansion of its services.

This pursuit of financial stability is crucial for Starlink to maintain its position as a leading provider of satellite internet access globally.

A Contentious Competition Among Billionaires

Last week, Richard Branson’s announcement that he would be a passenger on the upcoming Virgin Galactic flight to low Earth orbit – scheduled for July 11th – came as no surprise. This mission represents the first fully crewed flight for the space tourism venture.

Jeff Bezos is also planning a journey into space aboard a reusable rocket developed by his own company, Blue Origin, with a launch date of July 20th. Should both flights proceed as planned, Branson is poised to reach space approximately nine days before Bezos.

It’s understandable if you find yourself lacking significant interest in this contest between two prominent billionaires, who are expending substantial funds in a bid to be the first to experience a brief period in what is technically defined as ‘space’. Acknowledging this lack of concern is perfectly reasonable.

Despite this, the situation has garnered attention, prompting discussion and coverage. The technical accomplishments achieved by both companies, and the dedicated teams responsible for ensuring the safe transport of humans to space, are genuinely noteworthy.

The billionaires themselves are essentially passengers, serving as valuable, though imperfect, representations of typical human travelers. Their presence allows for crucial testing and data collection.

Interestingly, Elon Musk appears to be disengaged from this particular display of competitive spirit, earning him some uncommon praise for his lack of involvement.

The Significance of Technical Advancement

The flights undertaken by Virgin Galactic and Blue Origin are significant due to the engineering feats they demonstrate. Years of research and development have culminated in these spacecraft capable of reaching the edge of space.

Safety is paramount, and the teams involved have dedicated themselves to rigorous testing and refinement to ensure the well-being of the passengers. This commitment to safety is a crucial aspect of these missions.

A Question of Perspective

The definition of ‘space’ itself is somewhat arbitrary, relying on a specific altitude threshold. This highlights the somewhat contrived nature of the competition.

While the spectacle of billionaire space tourism may seem frivolous to some, it represents a potential step towards making space travel more accessible in the future.

Musk's Detachment

Elon Musk’s apparent indifference to this rivalry is a notable contrast. He has not publicly engaged in the same manner as Branson and Bezos.

This stance has been viewed favorably by some, who appreciate his focus on other space exploration endeavors, such as the development of Starship.

SpaceX and Virgin Galactic’s Recent Achievements

Image Credits: Relativity Space (opens in a new window)

Recent activity saw both SpaceX and Virgin Orbit successfully deploy payloads for their clients. This is standard practice for SpaceX, but represents a significant milestone for Virgin Orbit. SpaceX’s second dedicated rideshare mission transported 85 satellites for various customers, alongside three of its own.

Concurrently, Virgin Orbit completed its inaugural commercial launch. This followed a successful demonstration launch earlier in the year, and included deploying small satellites, notably the first for the Netherlands’ military.

Expanding Launch Capabilities

Should Virgin Orbit achieve its planned operational expansion, weeks featuring multiple launches from diverse commercial providers could become increasingly frequent. Virgin Orbit now possesses the capability to launch on demand, joining SpaceX and Rocket Lab in this regard.

Several other companies are also progressing rapidly in this sector. These include Astra, which has recently become a publicly traded company, and Relativity Space.

Relativity Space’s Production Expansion

Relativity Space announced the construction of a new, expansive 1 million square foot factory. This facility will accommodate the company’s large-scale 3D printers, facilitating increased production of its Terran R rocket.

While Relativity’s Terran 1, its first 3D-printed spacecraft, has yet to fly, the launch remains scheduled for later this year.

The Cost of SpaceX’s Starlink Terminal is Substantially Higher Than its Sale Price

Image Credits: Starlink

Elon Musk participated remotely in the MWC conference held in Barcelona to discuss Starlink. When questioned about the criteria for success of this developing global connectivity service, he stated that the company’s primary goal is to avoid bankruptcy.

Following successful financial stability, longer-term planning will commence. He highlighted that previous attempts to replicate Starlink’s objectives have consistently resulted in business failure.

Musk acknowledged that SpaceX has already invested between $5 and $10 billion in the constellation and associated service. An additional $30 billion is anticipated to be invested over the long term.

A crucial point raised was that the customer purchase price of $500 for the terminal and modem kit is significantly lower than the actual production cost to SpaceX, which exceeds $1,000.

Currently, these units are being sold at a considerable loss. Starlink has the potential to become a substantial and reliable revenue stream, potentially exceeding the consistency of the launch business.

However, achieving this will require a considerable amount of time. This explains the frequent launches of Starlink satellites, as the company strives for comprehensive global coverage.

Expanding the customer base is a key objective in realizing this goal. The service aims to provide connectivity to areas where traditional infrastructure is limited or unavailable.

Financial Considerations for Starlink

Initial investment: $5 - $10 billion
Long-term investment projection: $30 billion
Terminal/modem cost to produce: Over $1,000
Customer purchase price: $500

The current pricing strategy indicates a willingness to prioritize market penetration over immediate profitability. SpaceX is betting on future revenue growth to offset these initial losses.