Editorial: The Launch Market Tightens

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  Space News Business

Editorial: The Launch Market Tightens

posted: 22 February 2007
03:53 pm ET


I t goes without saying that there is never a convenient time to have a launch failure, but the Jan. 30 Sea Launch mishap that destroyed SES New Skies’ NSS-8 satellite was particularly ill-timed.

For the next couple of years, the world’s leading commercial launch service providers — Arianespace, International Launch Services (ILS) and Sea Launch — are either booked solid or nearly so. Barring delays in satellite deliveries, which are fairly common but difficult to predict, there will be precious little maneuvering room on commercial launch manifests.

Sea Launch had been hoping for at least five and perhaps a company record six launches in 2007. Now, as the Boeing-led venture prepares to assess the damage caused by the on-pad explosion of its Zenit-3 SL rocket and investigate the cause, all bets are off. There is no official estimate of how long Sea Launch will be out of action, but given the known damage to the pad and time it generally takes to conduct failure investigations and implement corrective actions, a hiatus of at least several months is likely.

As a result, companies booked on Sea Launch face potentially costly delays, which in turn will complicate planning across the industry. Customers of Sea Launch’s Land Launch venture, which will launch commercial payloads aboard a derivative of the Zenit-3 SL from the Baikonur Cosmodrome in Kazakhstan, also could be delayed. The first Land Launch mission is scheduled for this summer.

One company that could help ease the squeeze exacerbated by the Sea Launch failure is Lockheed Martin, whose Atlas 5 rocket in recent years has been a marginal player in commercial launch services due to the high cost of manufacturing rockets in the United States. Lockheed Martin recently booked its first commercial Atlas 5 sale since it bailed out of ILS, the joint venture with Russia established during the 1990s that today markets only Russia’s Proton rocket.

Lockheed Martin’s contract to launch an Inmarsat 4 satellite in late 2007 or early 2008 appears to be unrelated to the Sea Launch mishap. And whether the Atlas 5, whose manifest is effectively controlled by the U.S. Air Force, is even an option for stranded Sea Launch customers is questionable — it still takes roughly two years to manufacture a rocket, and vehicles under construction typically are already spoken for.

There are occasions in which an Atlas 5 will become available on relatively short notice, as happens from time to time with commercial vehicles such as the Ariane 5. But it is not a vehicle that time-pressed satellite owners can bank on as a safety valve.

With the arrival of Land Launch, to be followed in late 2008 by the introduction of Russia’s Soyuz vehicle to Europe’s equatorial Guiana Space Center launch site, owners of small to medium-sized geostationary communications satellites will have more choices than in years past. But for the larger satellites that still comprise the bulk of the market, the options will be limited to the Ariane 5, Proton, Zenit-3 SL, and perhaps Atlas 5 for the foreseeable future. India is still a ways away from becoming a factor in the geostationary launch services market, and China’s recent debris-generating test of an anti-satellite weapon likely has earned it several more years in the commercial launch wilderness, at least as far as U.S.-produced satellite hardware is concerned.

Although the current stable of launchers is sufficient to meet the expected market demand in the coming years, there will always be circumstances — this being the space industry, after all — such as failures, satellite delays and even the occasional deployment of a large constellation that put the squeeze on capacity. In fact, manifest bottlenecks and increased costs of Russian rocket hardware have driven up launch prices for the past two years, effectively ending a period in which satellite owners were able to dictate terms to launch providers. The Sea Launch failure has only compounded the situation.

Arianespace’s announcement Feb. 15 of an agreement to boost Ariane 5 production by one or two vehicles per year is a helpful response to the situation. But it remains to be seen whether ILS will follow suit — the revamped company appears inclined in the opposite direction — and Sea Launch has a practical ceiling of about six missions per year.

Much has been made of launch vehicle backup arrangements, but these have yet to be widely utilized. There are a number of challenges, including the fact that they cost money, launch providers are fierce competitors, near-term manifest openings are hard to come by and there is price variance among launch vehicles.

Nonetheless, backup deals remain a viable, if imperfect, option for dealing with periodic launch bottlenecks. Satellite owners and launch providers need to work together to make such arrangements more practical. Measures that would help include the adoption of standardized hardware and a commitment to greater transparency between satellite and launch companies concerning the status of manufacturing projects and failure reviews. Launch services providers could even consider an industry-wide back up arrangement.

These steps will cost money and require companies in some instances to buck their competitive instincts, but anything with the potential to reduce the uncertainty and delays that do harm to the entire industry should be explored with a renewed sense of urgency.