Editorial: Tragedy Meets Uncertainty

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  Space News Business

Editorial: Tragedy Meets Uncertainty

posted: 10 August 2007
11:56 am ET









T


he accident that killed three workers and injured three others at the Mojave, Calif., facilities of Scaled Composites July 26 is a tragedy that demonstrates yet again that cutting-edge aerospace is a risky business – even on the ground.



It is far too early to tell what caused the fatal nitrous oxide tank explosion.




The company’s founder and president, legendary designer Burt Rutan, was quoted in the July 27 edition of the Los Angeles Times




saying it occurred during propellant flow testing on SpaceShipTwo, the first of a fleet of suborbital space tourism vehicles Scaled Composites plans to build as part of a joint venture with Sir Richard Branson’s Virgin Group. According to the story, Mr. Rutan, who appeared at a press conference after the accident, said the same tests were




performed “a lot” with




the company’s X-Prize-winning SpaceShipOne vehicle without incident.













Clearly this is a setback for the space tourism




venture, dubbed the Spaceship Co.




, but Mr. Rutan gave every indication that he will press on with SpaceShipTwo. Another point that needs to be made is that accidents happen in this industry; large and presumably risk-averse government contractors are no less prone to fatal mishaps than smaller, entrepreneurial companies.

The tragedy comes on the heels of news that Scaled Composites will be acquired – lock, stock and barrel – by Northrop Grumman Corp. It is one of the more intriguing developments affecting the entrepreneurial space-travel industry in recent months, events at Mojave notwithstanding.



For several years, Northrop Grumman has quietly owned a 40 percent stake in the specialty boutique, builder of a number of record-breaking aircraft as well as the suborbital SpaceShipOne craft, which won the $10 million X Prize by carrying a person into space and back twice in a two-week period. On July 5, the aerospace and defense giant agreed without fanfare to increase that stake to 100 percent pending U.S. regulatory review.

The possibilities this raises are tantalizing: Mr. Rutan and his tiny shop




have accomplished amazing feats over the years




without the benefit of a large corporate parent or government contracts. Imagine what they could do with the technical and financial resources of




Northrop Grumman at their disposal; or the creativity and innovation they could bring to U.S. government programs, which often are distinguished by a lack of imagination




and little tolerance for risk taking.

On the other hand, one has to wonder how well a maverick like Mr. Rutan, who is not used to playing by traditional rules and who has never been shy about criticizing NASA – fairly or unfairly – will fare amid Northrop Grumman’s button-down culture and government orientation.




There is always the potential




that Northrop Grumman will have a stifling rather than enabling impact on Scaled Composites.

For its part, Northrop Grumman says it has no intention of putting a leash on Mr. Rutan. Dan McClain, a spokesman for Northrop Grumman, said the company hopes to leverage Scaled Composites’ entrepreneurial and innovative spirit as it seeks out new opportunities in both aeronautics and space. It looks like a shrewd business move – Scaled Composites has a lot to offer in the realm of unmanned aerial vehicles, for example, whose uses by the U.S. and other governments for surveillance and other applications continue to grow.





What




remains to be seen




is how much freedom Scaled Composites would




have as a wholly owned subsidiary of a major government contractor. Will Mr. Rutan be able to put his company’s time and resources into other high-risk entrepreneurial space ventures now that he must answer to a corporate parent with its own board of directors? What will happen if Scaled Composites comes up with a clever way to solve a problem, only to find that the government, for whatever reason, is not interested? That begs the broader question of whether Northrop Grumman, given its fiduciary responsibility to shareholders, would put a near-term corporate interest – in other words, a potentially lucrative government contract – at risk for the sake of innovation that might undermine that contract but benefit the government or industry in the long run.

Outsiders have an important role to play in the space enterprise: shaking up the status quo,




something Scaled Composites did in dramatic fashion in winning the X




Prize. Years ago, a pesky little company called PanAmSat did the same thing; it challenged the multinational, government-backed entity known as Intelsat and won, thus creating a commercial satellite communications industry.





It is often the case that pioneering creative types, be they artists, architects entertainers or aerospace engineers, lose their inventive, risk-taking edge once they get discovered and drawn into the mainstream. It would be a loss for the space enterprise if this were to happen to Mr. Rutan and Scaled Composites.