U.S. government should reduce impediments to commercial space innovation

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SAN ANTONIO, Texas — The U.S. government could bolster commercial space innovation by relaxing regulations and lowering some of the bureaucratic hurdles that discourage private firms from working with federal agencies, according to panelists at the 2017 GEOINT Symposium.

Remarkable things are happening in the commercial sector, including private investment in space industry startups, advances in imagery and new launch options. “It’s a dramatically changing time that requires help from a regulatory perspective,” said Steve Jacques, Jacques and Associates, a Washington consulting firm.

Without changes to the regulatory environment, some space industry startups eager to work with government customers are likely to give up. “Unless you are a large integrator with a staff that knows how government contracts work and can deal with [International Traffic in Arms Regulations], there’s an uphill battle,” said John Hanna, Spaceflight Industries vice president for U.S. government. “Eventually, a lot of these really great companies will turn away from the government.”

If that happens, some daring space capabilities may never be realized because emerging markets for space data and services, like hedge funds and insurance companies, are not as mature as the government market. “The initial customer today for technology we are developing is the government,” Hanna said.

Even well-established companies like DigitalGlobe are frustrated when dealing with government agencies. Marcy Steinke, DigitalGlobe senior vice president of government relations and public policy, said “There is a regulatory shift that needs to occur and there’s a shift that needs to occur in the thought process of using commercial to the maximum extent.”

Part of the problem could be addressed with better training of federal workers, Jacque said, citing a recent case in which a federal contracting officer was not familiar with specific federal acquisition regulations designed for commercial acquisitions.

Still, Steinke said she is encouraged by congressional interest in reducing commercial space regulations because many of the existing rules were drafted decades ago when cell phones, drones and international satellite technology was not as advanced as it is today. “We can all agree there is a vast array of things that no longer need to be regulated like they are now,” Steinke said.

Recently, the Senate Commerce, Science and Transportation space subcommittee and the House Science, Space and Technology Committee have held hearings on ways to streamline regulations and encourage commercial innovation.

The government needs to quickly address these impediments to private sector innovation because it will need to employ small satellites and advanced technologies to address growing threats from potential adversaries, said Jeffrey “Skunk” Baxter, a national security consultant who often leads wargame red teams and a founding member of American jazz rock band Steely Dan.

“I want to stop looking at small satellites as exotic animals,” Baxter said. “Come back to Earth and look at small satellites as utility. As we get into the concept of conflict, we are going to need a lot of them.”