We find ourselves still at the dawn of a new space century, mindful of the victories and setbacks of our past, eager to pass the torch to the next generation of space visionaries, scientists, engineers, and enthusiasts. We look to the future not just to see how much bigger, faster, or higher we can reach, but also how the United States, and specifically the U.S. space community, can again inspire the nations of the world to align with us, as it did in the 20th century.

The SmallSat Alliance is an alliance of companies developing, producing, and operating in all segments of the ‘next generation’ space economy; championing renewed U.S. leadership in the burgeoning commercial space economy, and advocating for the transformation of government-led space capabilities. We are experienced space professionals who have chosen to join with others leveraging our decades of hard-won experience, to develop smarter ways to explore space in the 21st century.

A wonderful outgrowth of the legacy space program is the commercial, entrepreneurial, and job-creating commercial space business that it bequeathed. These next-generation enterprises range from multi-million-dollar startups providing rideshare opportunities or components for small satellites to multi-billion-dollar space data-analytic platforms reinventing urban car service and agricultural production. The early returns of this economic revolution are already on our doorstep: space data capabilities are exponentially growing elements of the 21st century world economy.

Beginning with the dreams and funding by successful tech entrepreneurs, enormous venture investments are already delivering wondrous benefits to the world.

Commercial Space – Profit and Non-Profit

There are really two major categories in the commercial sector, the profit driven and the non-profit. The classic for-profit companies include not only those designing, building, launching, and operating satellites but also the tech sector that is turning that raw space data into gold through machine-learning analytics. Since for-profit companies are no longer dependent upon the revenues generated by the Cold War space race culture of a bygone era, this new generation of space companies is able to more efficiently capitalize on Moore’s Law, the nonstop exponential growth in chip density, and the associated networking technology co-evolving with it. This new generation is building profitable businesses helping to clean up our oceans of garbage and debris with satellite surveillance, reconnoitering to assist in enforcing laws that protect our oceans from illegal, unregulated, unlicensed fishing, something that is rapidly depleting the world’s most valuable and essential lifeforms. It’s leading in the innovative use of low-cost satellite constellations to produce ubiquitous remote-sensing data, enabling small business owners to be more profitable and less wasteful. For example, precise timing signals from space are already optimizing transportation of people, goods, and services, with even further gains anticipated with the introduction of artificial intelligence to assist drivers, perhaps even someday replacing them entirely.

Artist’s concept of the York Space S-Class platform the Denver company builds to host payloads up to 85 kilograms. Credit: York Space
Artist’s concept of the York Space S-Class platform the Denver company builds to host payloads up to 85 kilograms. Credit: York Space

The non-profit sector is the other side of commercial space, concerned more for the general welfare of society, but every bit as integral to this new space enterprise. Much like every century before it in human history, ours is not without its unique challenges, some of which have been a consequence of the last, and all of which the space data domain can be leveraged to help solve. Examples are endless, but one challenge that this new space community is uniquely well-adapted for is to further inform worldwide resource allocation for the 21st century and beyond. These two primary resources are sustainable water and the materials needed for adequate housing for an ever-increasing human population. As cities and urbanization continue to expand, governmental planning challenges such as transportation design optimization for goods and services are only the beginning. Additionally, through using inexpensive remote sensing technologies, some members are designing space data analytics to mitigate human suffering from plagues, contain outbreaks, and combating illegal poaching. Some are connecting with other non-profits to curtail human trafficking for the sex trade or forced labor for migrant debt repayment. Still others are helping non-governmental organizations in their work to expose the use of children as soldiers. Addressing these challenges has little to do with resuscitating dreams conceived by long deceased science-fiction writers and much more to do with turning “swords back into plowshares” to solve real threats to humanity.

Other non-profit initiatives include pursuing an even more foundational understanding of who we are and how to be the best custodians of our environment. Much as exploring and monitoring the world’s oceans has advanced civilization through a better understanding of human life and the planet, so too does exploring and monitoring from space. Low Earth orbit (LEO) provides a unique vantage point to look back on the planet and understand what is happening, anticipate what might happen and prepare for the future. In addition to better understanding Earth, responsible and rapid exploitation of the low Earth orbit domain will enhance the understanding of the solar system and the rest of the universe. Small satellites already offer low-cost platforms to study and explore what lies beyond the Earth. Other members are pioneering the use of zero-carbon, hydrogen-based reusable propulsion systems to ensure we don’t worsen our atmosphere using kerosene-fueled rockets for the coming tsunami of satellite launches. Finally, a mission ensuring the general welfare and planet survival for the next thousand years is finally confronting the existential threat that asteroids and comets pose to humanity. These extra-terrestrial, deep-space threats are passing dangerously close to our planet, and today we have no solar map of them and no defense.

National Security Space – Anticipating changes in the character of war

Completely intertwined with commercial space, the national security sector of space is already being dramatically affected, whether it resists the changes or not. The era of unfettered access to a tranquil space domain is clearly over, and the domain itself has become quite dangerous. Much like secure ocean transportation lanes and ports are essential to modern civilization and are secured by multi-national agreements and treaties, national defense and economic security is reliant upon robust national security space capabilities. As much as small satellites are enabling a rapid exploitation of low Earth orbit for commercial missions, they are already showing great promise in tackling routine national security needs like surveillance and early warning at greatly reduced costs. According to the Defense Advanced Research Projects Agency (DARPA), the current process of slow, monstrously expensive, and risk-averse decision-making to produce strategic-only space assets only perpetuates more stove-piped operations, insufficient resiliency, and on orbit electronics 20 years out of date. And apparently this approach keeps us on a path to be incapable of addressing today’s more agile threats from China, Russia, and North Korea.

SpaceKnow combines satellite imagery with analytics to monitor shipping activity in Hamburg, Germany. Credit: SpaceKnow
SpaceKnow combines satellite imagery with analytics to monitor shipping activity in Hamburg, Germany. Credit: SpaceKnow

While the small satellite industry builds upon a technical foundation created by the early visionaries in aerospace engineering and space exploration, a departure has begun. Very recently, DARPA and other offices within the Department of Defense (DoD) have highlighted that our adversaries are outmaneuvering us by increasing their rate of innovation. With the U.S. small satellite industry now well-capitalized and profitable, the DoD today has the ability to commercially acquire off-the-shelf capabilities with industrial reliability and focus its precious R&D on exquisite and niche components where there is no commercial market.

As our space industry hurtles ever faster towards a freer market, legacy companies designed and built to mimic their highly bureaucratic customer seem to be struggling to lead. The best near-term course correction for the national security sector is that when segments of missions of the defense space business have low-cost commercial equivalents, the government should become a buying customer along with the rest of the global market and benefit from the free market competition. This is exactly what emerged in the 1990s as the DoD and intelligence community adapted to the advent of commercially available UNIX (and eventually PC) high-performance platforms and the rapid phase out of costly custom-designed computers for command, control, communications, and intelligence. Relentless competition among the UNIX based companies drove down prices, enabling tactical use of data.

Behind the headlines across the space community, there is a revolution in the space economy that is unfolding. Discrete company events and milestones are reported regularly but very rarely are these stories written within a framework that puts a proper context to the revolution that’s underway. What the new commercial space community is finally doing is shattering an ossified space business model, largely rooted in a militaristic, planned economy system, and served by a consolidated industrial oligopoly. It may take longer than some of the most ambitious entrepreneurs expect, but the competition and opportunity to make a real difference is challenging all of us to “do better.” The members of the alliance are plying their respective abilities and acumen to solve one of the nation’s gravest threats, the absurdly high cost and grotesquely vulnerable “juicy targets” as Air Force Gen. John Hyten, the United States’ most senior warfighting space general, describes the current operational assets with which he is equipped to fight. As a nation, we risk losing future space wars if we wait to adapt ourselves after these changes have occurred.

Private investor perspective

The SmallSat revolution now underway has obvious national security value, but should the investor community continue to invest in space as the next economic frontier? The answer is an unequivocal ‘yes’, but as much as the next generation space economy parallels the internet expansion of the last 20 years, the needs and expectations are different. The financing community, both equity and debt financing, should worry less about being an early stage investor in the next “unicorn” and focus more on solid business fundamentals with realistic expectations, vision and risk. Legacy space companies have required tremendous capital expenditures (CAPEX) before revenue generation, yet many new companies are discovering through standardization, smart partnering, and leveraging off-the-shelf technologies, that is no longer the case. Because of that CAPEX, low earth orbit (LEO) remained for decades the exclusive domain of National Security and “Civil” Space, meaning NASA and NOAA endeavors. Today, it is rapidly becoming a successful commercial economic domain, one where utilization and exploitation is no longer the privilege of a few governments but open to virtually everyone including students. This revolution is now well underway and is accelerating as humanity becomes ever more communicative and data consuming. New missions, both governmental and non-profit, aim to improve our awareness of our planet and to help cure what ails it. Better weather prediction will enable more informed operational planning, preparation, and response to weather catastrophes. Increased export of these services will improve other peoples lives as well as our own. To get the best value for the taxpayers dollar, competitive/fixed price contracting for these commercial products and services needs to be the rule, not the exception. Private investors have very rigorous due diligence processes in place and are underwriting the technical risk, so rarely is there a need for the cost-plus development contracts of old. Naturally, some legacy companies see the small satellite community as the existential threat they could become and are already reacting accordingly. Others, though, are seeing the future and smartly working to truly partner or leverage this next generation of technology.

The SmallSat Alliance is immersed in this changing economic landscape and leading by advocating that its capabilities are appropriately considered in all phases of space acquisition and operations for the U.S. government. By developing strategic partnerships with other aerospace companies that embrace this entrepreneurial revolution, a newer and even better space century awaits not only the United States, but the rest of the free societies eager to leave the world in a better position than what they inherited.

Charles Beames is the chairman of the SmallSat Alliance and executive chairman of York Space Systems.

This op-ed originally appeared in the July 30, 2018 issue of SpaceNews magazine.

Charles Beames has an extensive background in space, government and finance and currently serves as Chairman for both York Space Systems and SpiderOak, as well as the SmallSat Alliance. Chuck is a Forbes contributor and prolific writer on the topic.