Analysts: Commercial Spaceflight Industry Ripe for Investment

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  Space News Business

Analysts: Commercial Spaceflight Industry Ripe for Investment

By TARIQ MALIK
Space News Staff Writer
posted: 24 April 2007
11:11 am ET




But Warn the Window for Investing Could Be a Short One




NEW YORK — Would-be space investors have a slim window to delve into the field of commercial spaceflight, industry analysts said last week.

With the current push by several private firms to develop commercial launch services for the international space station (ISS) and NASA’s coming gap between the 2010 retirement of its space shuttle fleet and their eventual Orion successor, the time is especially ripe for space savvy investors, experts said during an April 17 Space Investment Summit held here near Wall Street.

“Right now is a very interesting window where there are people who are trying very hard, including [people] within the government, to bring down the very high barriers of entry,” Alan Marty, an investment consultant who is working with NASA’s Commercial Orbital Transportation Services (COTS) program.

NASA’s COTS program is aimed at spurring privately developed spacecraft capable of ferrying astronaut crews or cargo to the ISS . Securing such services is vital since the shuttle fleet is scheduled to be retired in 2010, but NASA’s first launch of its successor, an Orion Crew Exploration Vehicle, is not expected until early 2015.

The space agency has split a $500 million award between two U.S. firms – California’s Space Exploration Technologies and Oklahoma’s Rocketplane Kistler – under its COTS program. It also has secured space aboard Russian Soyuz and Progress spacecraft for crew and cargo flights to the ISS through 2011 under a $719 million deal with Russia’s Federal Space Agency.

In addition, there also are vehicles that are being built to serve the emerging market for suborbital space tourism.

“Several large projects are coming to fruition,” said Jaques Vallee, a partner in the venture capital firm SBV Venture Partners. He was referring to space tourism firms such as Sir Richard Branson’s Virgin Galactic, which hopes to make its first operational suborbital flights in 2009. “Within two years, the landscape will have changed.”

The COTS program, as well as several other agreements NASA has with private spaceflight firms such as the Chicago-based PlanetSpace and Sir Richard Branson’s space tourism-themed Virgin Galactic, which include sharing technical data but no NASA funds, represent a temporary lowering of the entry barriers into the spaceflight industry, Marty said.

But once NASA’s COTS competitors begin providing regular launch services, or the space agency’s Orion spacecraft program hits its own stride, the barriers for new companies to enter the industry will rise once more, he added.

“If they are successful, the [financial] run is going to be a very nice run,” Marty said of those firms that slip through.

Beyond spaceflight firms, enabling technologies such as the electronics and micro-electro-mechanical systems necessary for onboard communications, life support and other systems, also are growing areas of interest for space investors, analysts said.