Space economies and economics

[AngelLestat]

Economic consequences of technological advancements in the space market

How cost and demand are related in the space market?

How the new technologies would affect this relation?

This discussion continuous from the "Best Energy Alternatives to stop global warming" topic.

---------------------------------------------------------------------------------------------------

What you were saying was that reducing cost *automatically* increases demand. I'm glad you seem to have realized that this is not *always* true and that it is much more complicated than your *basic* rule.

First, first lets clarify how this discussion started.

You said that even if skylon arrives to the market and reduce the launch cost by a lot. It would be pointless becouse there is no market for it. The demand is not there.

And I said, if the launch cost is reduced as skylon project it or less (lets said 1/10) it would increase the demand and new markets would emerge.

You denied this saying that the space industry is already very competitive and that the price elasticity would reject any benefic in cost that we might had from any new launching technology.

I said, that if SpaceX achieve its full reusable program, they would reduce their launch cost to their actual cost even if their competence are far to achieve its prices and even if they can not deal with all initial demand. And they would do it just to send a message out there and wake up a new market consolidating themselves as the most important space agency.

Elon Musk will do this in part as its business strategy to ensure his position before new (or better) technologies arrive, he will do this also by pride. Because many people (and hero astronauts) said to him that he could not do it.

You insist that reusability yields some sort of huge cost savings. Again, let's take an example of the costs of running a launch business.

- Booster R&D

- Booster manufacturing

- Booster testing

- Launch site facilities

- Transportation

- Stacking

- Payload integration

- Propellant

- Launch operation

- Sales and Marketing

- Administration and HR

Now, for each of these steps, you need to pay people. Salaries are the biggest cost factor here, not the material of which the rocket is made. A few tons of aluminium is cheap compared to the salaries of the folks who are needed to operate the company.

If you have a reusable rocket, you dont need to test it so much, becouse you know that it works. Is not like a new engine or part that you make and never was tested.

So you save transportation and recovery of parts, also transportation of new raw material to build this this parts.

Cost as payload integration, administration and HR, stacking, propellant, sales and marketing (seriously??) are <<<<< than the others costs. And you dont need them in a reusable program.

For example SpaceX said than even if recovery efforts are only successful with the first stage, they could reduce launch costs up to 70%!!

Only 1 recovery!

So a reusable program can reduce launch cost in a 90%.

No, my arguments about why Skylon is unrealistic is in those threads. If you want to insist that Skylon is going to happen, you need to address my arguments in those threads. I've provided my numbers and my demonstration. The onus is on you to demonstrate that it is feasible if you want to keep on using Skylon as an example.

Just with spaceX arguments I prove you how cheap they can be. So if we take the skylon example and how cheap it might be, is from 2 to 3 times more cheap than the spaceX reusable program.

You can reduce some of the cost, yes, but not all of it. And because a 90% reduction in launch cost is not realistic, then hypothesizing about other costs if that happened is pointless. To support any business case for "cheap" launches, you are going to need to demonstrate first that there is demand for 500 launches per year instead of 50. There simply isn't. In fact, it's the opposite. The current market is saturated and the demand for GEO comsats is going to decrease because their latency makes them really only useful for broadcast, which is becoming a niche market. In a few years, the bulk of communication, including TV broadcast, will be through LTE and optical fiber links. Without even talking about launch cost, cell towers require a lot less energy to operate than GEO satellites.

It is realistic, it has 100% sense, and those estimations were done by all the new agencies which are developing reusable programs.

About the demand, if we talk of a 1/10 cost reduction its silly to think that new markets would not emerge.

Not only that, this kind of cost reduction reduce the cost of spacecraft construction and operation too. By a lot!.

PD: why you ignore magnemoe´s comment?

Economically, they're all somewhat similar. Reducing car prices does not necessarily increase the demand for cars, especially if the roads are already crammed with too much cars. With spacecrafts, it's a little different; unlike cars, spacecrafts today doesn't have much use other than what is available already, so the demand is inelastic. Reducing launch costs may reduce the overall costs that a launch client must bear, but it doesn't necessarily attract new clients.

They are completly different. And your problem still remains that you can not imagine the new markets for rockets.

even if you do, chances are you're looking at a case where multiple spacecrafts are being launched on one launcher. It's a common practice; in fact, during SpaceX Dragon's first mission to the ISS, the rocket also carried an Orbcomm satellite as a secondary payload.

I dont remember that being the case, I would search other sources later. Edited June 30, 2014 by AngelLestat

[Red Iron Crown]

In fairness, you are taking your reusability estimates from companies that are selling reusability. And they are estimates only, and interpreted in the most favorable way possible; I sincerely doubt that the estimates take into account the overhead costs that Nibb31 mentions.

Even if the estimates are close to right, space is still an incredibly harsh environment in which to work, harsher than deep undersea, deserts, or Antarctica. There's just not a percentage to be made from moving operations up there unless they cannot be done anywhere else. So the demand for spaceflight in the near term is relatively inelastic; those that need it really need it and are willing to pay steeply for it, those that don't need it still don't need it at a reduced price.

That's not to say that there would be no increase in demand at a lower cost, but I don't think it's nearly enough to justify the launch schedule necessary to make reusable spacecraft more viable than disposables.

[NGTOne]

The part I find interesting is that there is ALREADY demand for commercial R&D slots in space, despite the complete+utter lack of infrastructure. And I'm not talking all that "space tourism" malarkey, either. Admittedly, it's mostly national governments so far, but the point nevertheless remains. And there ARE actually already applications that would benefit greatly from access to space, even without an a priori space economy (i.e. they don't rely on asteroid mining to be viable). I actually started a couple of discussions on the topics of space manufacturing (most notably semiconductors) a few months back (please don't necro).

One way or another, the demand WILL appear. Whether individual providers (most notably Skylon), especially in the early stages, will survive, is another question, but I foresee that, in the long term (next 50 years or so), we will see actual space industry, even if it's based purely on the paradigm of "up-process-down".

[Everten P.]

You could colonize other planets and alienate them from other countries then have space truckers deliver things

[Nibb31]

Alright. First of all Skylon. Here's a mashup of my previous arguments about it.

Skylon's engine, airframe, TPS, and pretty much every other technology are unproven. In theory, with some very optimistic margins, it should be capable of SSTO with a payload, but that's only theory. In practice, not a single large aerospace projects has gone without cost, weight, or schedule overruns. Attempting to implement so many new ideas in a single project that relies on each one of them working flawlessly only multiplies the chances of that project to fail. Especially when you are a small organization with limited resources.

- Skylon's fuselage structure and outer skin is unique but it also doesn't use conventional construction techniques. Airliner fuselages are typically cylinders that are bolted together. The same tooling and transport jigs are used for all of the sections. It uses all sorts of exotic materials that nobody has much experience with. So even then manufacturing techniques and tooling need to be developed from scratch. It took years for Boeing to industrialize the 787 carbon-fibre fuselage, and it's still much more conventional than Skylon.

- Skylon's TPS uses a new mix of superthin carbon-ceramic material that has never been tested. On paper, this isn't enough, so it also uses active cooling by vaporizing LH2 on the wing edges. Again, this has never been done before and is purely theoretical. Nobody knows how feasible these new techniques are in the real-world or what happens if the vaporization system fails or underperforms. Until someone flies a tech demonstrator through reentry, it's a no-go. Reentry demonstrators are expensive things to do. For example, ESA's IXV program took 5 years and 150 million to design, and it is just a subscale model that will fly on a Vega rocket.

- And of course, there is SABRE, on which the whole idea relies and that hasn't even been made into a subscale test bench demonstrator yet. They are decades away from making a flight-capable engine, let alone achieving the reliability and serviceability requirements that you need for flight operations. Yes, they have a prototype pre-cooler, which was the trickiest part to get working. Yet, how durable is it and how close is it a flight-ready component? Another comparison: It takes $1 billion and 10 years for P&W or GE to develop civilian jet engine. High performance military engines are typically more expensive.

Because none of the technology has been proven, nobody can tell what the actual capabilities will be, or even if it will be viable at all, because nobody has any experience in operating SABRE engines, in constructing an airframe like Skylon's, in commercially operating a reusable SSTO spaceplane, or even if the TPS is capable of withstanding the reentry constraints. We don't know how reliable it can be, what the service intervals or operation constraints will be, how much payload it can carry, how much it will cost to buy and fly, or if it can be economically viable. In the end, if the SABRE engines slightly underperform, or if the airframe ends up slightly heavier than planned, or if the TPS needs to be slightly thicker, then there goes your payload ratio and the viability of the project. That is a huge risk.

Skylon is bigger than an Airbus A380. Just to build a conventional heavy airliner requires a major airport with a reinforced runway, a production facility the size of a small city, and a supply chain involving hundreds of subcontractors. It took Boeing $32 billion and 10 years to develop the 787, which is just an airliner with fairly mature and well-understood technology, except for the carbon-fiber body. EADS spent $25 billion dollars to develop the A400M, which is just a conventional turboprop cargo plane. These are companies that have supply chains, armies of engineers, and they are working with reliable and proven technology. It takes years just to design stupid things like the landing gear or engine mounts... It takes more years to set up the logistics, to build or adapt a factory, to negociate supplier contracts, and so on. They need factories, test facilities, upgraded airport infrastructures, transportation, cranes, tooling...

There are zero subcontractors who have any experience building something like a SABRE engine, a unique carbon composite airframe larger than an A380, a unique TPS, the avionics... Just developing the tooling, the jigs, the test fixtures, and the software is going to take years. Heck, it even takes years just to hire the workforce that you need to do all those things.

Skylon is bigger and heavier than an Airbus A380. There's only a limited number of airports in Europe that have the reinforced runways that could handle it plus manufacturing facilities for large aircraft. The Airbus plants in Hamburg or Toulouse, and maybe a couple of others. So if Airbus is not a partner, and not willing to move their current production lines to make place for Skylon (airliners are much more profitable) they need to build a new factory and/or a new airport.

Skylon runs on LH2. It need lots of it if you want a fast turnaround. There are zero airports that have massive LH2 production or storage facilities nearby. So they also need to build that, which might not be possible at any of the existing manufacturing sites at all due to all sorts of environmental, industrial or political problems.

Now, things like factories, airports, supply chains, or hydrogen plants don't get built over night. They require years of paperwork, planning, paperwork, money, paperwork, construction, more paperwork, and political lobbying at a very high scale. You're going to need a strong political support to get such a project off the ground, so you are going to have to convince local, national, and EU parliamentaries and government officials. This alone is a huge effort that is going to cost millions.

Those are only some of the problems that they have to solve. There is no way a small R&D company can pull off such a large project. Even if there was a market for it, even if it was technically viable, and even if ESA, Airbus, and several European governments were on board, there's no way Skylon can fly any time soon. And that's an awful lot of "ifs".

Yet REL estimates that Skylon will only cost $12 billion, and that each unit will be cheaper than a good old Airbus A330, despite everything in Skylon being new, unconventional, and made of exotic new materials, and despite the production numbers being much lower than those of a typical airliner. The cost estimates are simply not realistic, and therefore neither is their business model.

Compared to the programs above, with all the groundbreaking technology and materials involved, I can't see it costing less than $30 billion to develop. If they optimistically find customers for 50 vehicles, it can't have a price tag of less than $1 billion per vehicle. Now, to cover the cost of a $1 billion dollar reusable spacecraft over a 10 year period, at SpaceX projected prices (~$50 million), if the cost of the vehicle is 50% of the operational cost (which is optimistic), you are going to need to fly each vehicle at least 40 times.

That's 40 launches x 50 vehicles / 10 years: 200 launches per year. If you cut the price of a launch to $10 million and miraculously managed to squeeze 200 flights out of an airframe, you're going to need 1000 launches per year to pay for the fleet. What sort of new market is going to suddenly appear that is capable of paying $10 million for a flight to LEO 20 times per week?

This is why Skylon will never fly: it requires an upfront investment in billions of dollars, with no promise of a future market and no promise of even technically working. Airliners and military aircraft projects have a market, with firm orders years before the first test flight and minimal risk.

tl;dr

There currently simply isn't a mass market for hundreds of Skylons with daily or weekly orbital launches, even at the cost of an airline ticket. Which is why EADS, BAE Systems, Rolls Royce or Boeing and Lockheed Martin are not lining up to buy their idea.

Edited July 3, 2014 by Nibb31

[Nibb31]

Now, with Skylon out of the way, as well as the hypothesis of 90% launch cost reduction, let's move on.

If you have a reusable rocket, you dont need to test it so much, becouse you know that it works. Is not like a new engine or part that you make and never was tested.

So you save transportation and recovery of parts, also transportation of new raw material to build this this parts.

How do you know it doesn't need testing? Replace "testing" with "maintenance". Everything needs maintenance. Things that are pushed to hypersonic speed, exposed to vacuum, go through physical stress, and reenter at high temperatures need more maintenance than things that don't.

Elon Musk has stated that he hopes to reuse his 1st stage boosters up to 10 times. Rocket stages have a limited number of tanking cycles. They go through extreme thermal and physical loads. You are always going to need to perform some maintenance, cleaning, inspection, and testing on each stage before reusing it. We are not talking about cars or airplanes here.

Cost as payload integration, administration and HR, stacking, propellant, sales and marketing (seriously??) are <<<<< than the others costs. And you dont need them in a reusable program.

Please explain why you wouldn't need them.

And if you are going to find new markets, you are going to need LOTS of marketing and sales people. Do you think seriously think launch providers or airlines don't need marketing departments? How do you run a business without any administrative overhead? How do you get the rocket and payload ready for launch without integrating and stacking the reusable stages?

For example SpaceX said than even if recovery efforts are only successful with the first stage, they could reduce launch costs up to 70%!!

Only 1 recovery!

So a reusable program can reduce launch cost in a 90%.

Quote please. That's ridiculous because it implies that for a projected SpaceX launch price at $50 million, each first stage booster alone costs over $35 million dollars!

In reality, we don't have the actual numbers of how much an individual SpaceX launch currently costs (hint: it is way higher than the "projected" price of $50 million) because private contracts are confidential or launch slots are purchased in bulk. The actors in this market only distill incomplete information as they seem fit. When Musk talks about reducing by X%, does he mean compared to current ULA prices? current SpaceX prices? Future SpaceX prices? Does he mean with just one reuse? 10 reuses? First stage only? Manned or unmanned?

We simply don't know, so we can't take anything for granted.

Just with spaceX arguments I prove you how cheap they can be. So if we take the skylon example and how cheap it might be, is from 2 to 3 times more cheap than the spaceX reusable program.

Your numbers are unsubstantiated. I have provided examples and comparisons for mine. Yours are just wishful thinking.

Edited July 1, 2014 by Nibb31

[Nibb31]

The part I find interesting is that there is ALREADY demand for commercial R&D slots in space...

That is "offer" not "demand". Bigelow has been trying to scrape up enough demand to justify his offer for years now.

[shynung]

They are completly different.

Economically, they are similar. That's just an analogy; if you want to compare it completely, you're looking at the wrong picture.

And your problem still remains that you can not imagine the new markets for rockets.

And how does that become my problem?

What are, then, the new markets for space launch services that are profitable and within our technological reach, but are still unexplored? Spacecrafts today have been used for everything from communication, Earth observation, reconnaissance, spaceborne telescopes, all the way to science experiments involving space exposure, microgravity, and even non-rocket propulsion systems.

Any space activities that requires a lot of energy (space manufacturing, asteroid mining) requires a large amount of mass delivered to orbit, much of it being expensive machinery whose technology haven't even been developed as of yet. Given the inherently risky nature of spaceflight, not a single organization on Earth, commercial or otherwise, is willing to put that much investment at risk.

The same reason applies to space tourism; because of the level of cooperation and organization involved in making manned spaceflight safe, and the high costs resulting from it, in addition to the high amounts of energy required to do it in the first place, only very few persons are able to afford vacationing in space.

Also, given the fact that space is basically just an empty void, there's nothing the space tourists would be able to do other than being stuck to their spacecrafts (and the limited activity choices resulting from it). In addition to the high costs explained above, not much people is interested in lofting themselves into space as of today.

Edited July 1, 2014 by shynung

[xcorps]

This again?

Spaceflight is an inelastic good. There is no consumer base outside of a very limited market. There is no supply base outside of a very limited oligarchy of providers. Launch price is not the only factor in launch COST.

Lower launch price for an inelastic good will not increase demand.

Trying to say that reusable boosters will get more people into space because prices will go down is like saying photons are really really small pieces of sand.

Edited July 1, 2014 by xcorps

[Mazon Del]

Any space activities that requires a lot of energy (space manufacturing, asteroid mining) requires a large amount of mass delivered to orbit, much of it being expensive machinery whose technology haven't even been developed as of yet. Given the inherently risky nature of spaceflight, not a single organization on Earth, commercial or otherwise, is willing to put that much investment at risk.

Not true, look at Planetary Resources. Right now they are working on getting up some satellites to help them search for viable candidate asteroids for mining. Their entire existence revolves around designing a mining platform to get at asteroids.

One of the things to also keep in mind is that the space launch sector is actually a GROWING business. Companies WANT to utilize satellites, and slowly companies are beginning to develop modular and multipurpose spaceframes (the structure of the satellite) instead of reinventing the wheel for every craft ever launched, which drastically reduces the costs of the payloads.

Somewhere here someone mentioned that nobody is going to want space-communications with the latency inherent in satellite communications. Tell that to Google. They are planning to set up a world spanning grid of satellites the provides unrestricable internet access to the planet. It won't be high speed fiber connections, sure, but it doesn't HAVE to be. Especially if the alternative is not having any internet at all!

[AngelLestat]

Ok, thank you for recapitulate your skylon discussion, that save me a lot of time.

But it seems so negative that I wonder how we pass the stone age if all works as you think.

Skylon's engine, airframe, TPS, and pretty much every other technology are unproven. In theory, with some very optimistic margins, it should be capable of SSTO with a payload, but that's only theory. In practice, not a single large aerospace projects has gone without cost, weight, or schedule overruns. Attempting to implement so many new ideas in a single project that relies on each one of them working flawlessly only multiplies the chances of that project to fail. Especially when you are a small organization with limited resources.

You have some good concern, but are similar to any new technology development. This means that nothing is developed? nothing new appear?

You need 20 years of development after you solve all main problems?

About funds, Skylon is the only card that the Europe comunity may had. You think ESA would let escape that oportunity? When the ESA report about skylon of 1 year of duration finish, they would be sure if it worth fund it or not.

Skylon's fuselage structure and outer skin is unique but it also doesn't use conventional construction techniques. Airliner fuselages are typically cylinders that are bolted together. The same tooling and transport jigs are used for all of the sections. It uses all sorts of exotic materials that nobody has much experience with. So even then manufacturing techniques and tooling need to be developed from scratch. It took years for Boeing to industrialize the 787 carbon-fibre fuselage, and it's still much more conventional than Skylon.

Skylon's TPS uses a new mix of superthin carbon-ceramic material that has never been tested. On paper, this isn't enough, so it also uses active cooling by vaporizing LH2 on the wing edges. Again, this has never been done before and is purely theoretical. Nobody knows how feasible these new techniques are in the real-world or what happens if the vaporization system fails or underperforms.

Lol, and you think that normal rockets dont use LH2 to cool either? Or that they dont have complex systems? Of course that it would had complex systems, but are not complex enoght to said that it would be a problem.

The main problem is already solve. Now they had 10 years to solve the baby problem which even I can imagine several ways to solve them being almost failures proffs.

We don't know how reliable it can be

So what we do? Nothing? I can not imagine any technological advance with that way to think.

Skylon is bigger than an Airbus A380. Just to build a conventional heavy airliner requires a major airport with a reinforced runway, a production facility the size of a small city, and a supply chain involving hundreds of subcontractors. It took Boeing $32 billion and 10 years to develop the 787, which is just an airliner with fairly mature and well-understood technology, except for the carbon-fiber body. EADS spent $25 billion dollars to develop the A400M, which is just a conventional turboprop cargo plane. These are companies that have supply chains, armies of engineers, and they are working with reliable and proven technology. It takes years just to design stupid things like the landing gear or engine mounts... It takes more years to set up the logistics, to build or adapt a factory, to negociate supplier contracts, and so on. They need a factories, test flights, transport, cranes...

ESA is doing its research, if they found that it can be done and they calculate the investment cost, they would do it even if it is a lot.

You think that the only thing that Europe win with this is sale cheap tickets to space? Think again.

Once you own the technology, then money fall from everywhere. This kind of engine or colling system has many applications, not only for space.. It can be used for a thermal power plant, or who knows what else.

There are zero subcontractors who have any experience building SABRE engine, their unique airframe, their unique TPS, the avionics... Just developing the tooling, the jigs, the test fixtures, and the software is going to take years. Heck, it even takes years just to hire the workforce that you need to do all those things.

??? they just need to follow instructtions and quality regulations. They had experience making things, that is the only thing that you need. Subcontractors are always producing new stuffs.

Skylon is bigger and heavier than an Airbus A380. There's only a limited number of airports in Europe that have the reinforced runways that could handle it plus manufacturing facilities for large aircraft. The Airbus plants in Hamburg or Toulouse, and maybe a couple of others. So if Airbus is not a partner, and not willing to move their current production lines to make place for Skylon, they need to build a new factory and/or a new airport.

They are already seaching location for the airport.

Skylon runs on LH2. It need lots of it if you want a fast turnaround. There are zero airports that have massive LH2 production or storage facilities nearby. So they also need to build that, which might not be possible at any of the existing manufacturing sites at all due to all sorts of environmental, industrial or political problems.

Well, if you think that produce and storage LH2 is a challenge, then I dont know how you survive your average day

Now, things like factories, airports, supply chains, or hydrogen plants don't get built over night. They require years of paperwork, planning, paperwork, money, paperwork, construction, more paperwork, and political lobbying at a very high scale.

Yeah, this is the part where you are out of arguments and you need to said something more because is not enoght.

The same for the next comments that you do from here.

That's 40 launches x 50 vehicles / 10 years: 200 launches per year. If you cut the price of a launch to $10 million and miraculously managed to squeeze 200 flights out of an airframe, you're going to need 1000 launches per year to pay for the fleet. What sort of new market is going to suddenly appear that is capable of paying $10 million for a flight to LEO 20 times per week?

I think that skylon info about development cost is not real (never is), but your estimation is also not real. But even if it is, you are wrong about the real profits that it can have.

[shynung]

Not true, look at Planetary Resources. Right now they are working on getting up some satellites to help them search for viable candidate asteroids for mining. Their entire existence revolves around designing a mining platform to get at asteroids.

At the moment, PR is planning to launch only space telescopes, to look for potentially useful asteroids to mine. Once they're highly confident that their asteroid does indeed exists, and is reachable, they'll launch prospectors and analyzers to confirm that the asteroid's content is valuable to mine. Only then they'll send mining equipments, power generators, supply lines, and support infrastructures to actually mine the asteroid.

And here's the catch: no asteroid mining rigs have been designed as of today, and no firms/agencies/institutions has any experience regarding such a spacecraft. If PR will be the one to start the 'asteroid rush', they'll have to start designing it from scratch, and that alone will need a lot of funding.

Edited July 2, 2014 by shynung

[xcorps]

Somewhere here someone mentioned that nobody is going to want space-communications with the latency inherent in satellite communications. Tell that to Google. They are planning to set up a world spanning grid of satellites the provides unrestricable internet access to the planet. It won't be high speed fiber connections, sure, but it doesn't HAVE to be. Especially if the alternative is not having any internet at all!

Yeah, Google would never jump into something that cost it money.

Like youtube.

Or Motorola.

Or Wallet.

[shynung]

You have some good concern, but are similar to any new technology development. This means that nothing is developed? nothing new appear?

You need 20 years of development after you solve all main problems?

Other new technology developments specialize in only one object (say, Boeing 787's carbon-fibre fuselage). Skylon needs several new technologies all at once. Looking from the condition of the REL corporation as of today, they're going to need obscene amounts of funding.

About funds, Skylon is the only card that the Europe comunity may had. You think ESA would let escape that oportunity? When the ESA report about skylon of 1 year of duration finish, they would be sure if it worth fund it or not.

They have Ariane 5, Soyuz, Proton, and the upcoming Angara rockets. Skylon cannot, and will not be developed within a year; that pace of development is simply out of reach from the current ESA's funding.

Lol, and you think that normal rockets dont use LH2 to cool either? Or that they dont have complex systems? Of course that it would had complex systems, but are not complex enoght to said that it would be a problem.

The main problem is already solve. Now they had 10 years to solve the baby problem which even I can imagine several ways to solve them being almost failures proffs.

Compared to a conventional liquid rocket engine, a SABRE engine is magnitudes in order more complicated.

Also, LH2 fuel require cryogenic facilities, as hydrogen cannot be kept liquid over 20 K at atmospheric pressure. These facilities comes with their own costs and problems, and are highly dangerous by itself (LH2 is explosive, and burns with an invisible flame); certainly something not desirable to have near airports.

So what we do? Nothing? I can not imagine any technological advance with that way to think.

Test it, test it, and then test it again. The testing phase alone raises much of the initial costs.

ESA is doing its research, if they found that it can be done and they calculate the investment cost, they would do it even if it is a lot.

You think that the only thing that Europe win with this is sale cheap tickets to space? Think again.

Once you own the technology, then money fall from everywhere. This kind of engine or colling system has many applications, not only for space.. It can be used for a thermal power plant, or who knows what else.

Cooling systems for spacecraft engine applications is vastly different than those for power stations. For one, the latter doesn't have to be compact, the working temperatures aren't as wide, and the working fluid is different.

??? they just need to follow instructtions and quality regulations. They had experience making things, that is the only thing that you need. Subcontractors are always producing new stuffs.

Subcontractors only produce objects that are within their range of technical abilities. No single contractor have any experience building SABRE engine components, let alone a fully assembled engine.

Well, if you think that produce and storage LH2 is a challenge, then I dont know how you survive your average day

It is. If not kept in liquid form, hydrogen leaks out of the tank it's in, molecule by molecule. Keeping the tank lower than 20 K is already hard enough on its own; having to store an explosive liquid inside of it is certainly much more difficult.

Yeah, this is the part where you are out of arguments and you need to said something more because is not enoght.

The same for the next comments that you do from here.

That's simply how anyone builds an airport. Without all that planning and paperwork, the people living nearby, along with their respective administration, will not approve it, and will cause significant problems in the near future.

I think that skylon info about development cost is not real (never is), but your estimation is also not real. But even if it is, you are wrong about the real profits that it can have.

How are you sure that his estimation is far off the mark? That's just calculating from REL's claim alone.

And if it's right, what are, then, the real profits it could have had, according to your estimation? And for that matter, how did you arrive at it?

Edited July 2, 2014 by shynung

[AngelLestat]

In fairness, you are taking your reusability estimates from companies that are selling reusability. And they are estimates only, and interpreted in the most favorable way possible; I sincerely doubt that the estimates take into account the overhead costs that Nibb31 mentions.

The true is that I dint see any serious estimate mentioned by Nibb31 that it would change or disprove spaceX values.

Even if the estimates are close to right, space is still an incredibly harsh environment in which to work, harsher than deep undersea, deserts, or Antarctica. There's just not a percentage to be made from moving operations up there unless they cannot be done anywhere else. So the demand for spaceflight in the near term is relatively inelastic; those that need it really need it and are willing to pay steeply for it, those that don't need it still don't need it at a reduced price.

The cubesat market is already growing, almost anyone can made this satellites, you buy the mainly parts from a commerce that already sell all that you need for this cubesats.

You can use cellphones as main processors and it is very easy make the software for them. The only that keeps slowing this market is the launch cost.

Even now nasa is planning some missions to mars using cubesats.

Now, with Skylon out of the way, as well as the hypothesis of 90% launch cost reduction, let's move on.

Out of the way just for 2 or 3 high school problems? The kids are smarted than that.

How do you know it doesn't need testing? Replace "testing" with "maintenance". Everything needs maintenance. Things that are pushed to hypersonic speed, exposed to vacuum, go through physical stress, and reenter at high temperatures need more maintenance than things that don't.

So for you testing is equal to maintenance?? I would not even bother to explain the difference.

Please explain why you wouldn't need them.

You dont need to build a new booster becouse you can use the same.

I cross out many of your launch cost list with only that.

And if you are going to find new markets, you are going to need LOTS of marketing and sales people. Do you think seriously think launch providers or airlines don't need marketing departments? How do you run a business without any administrative overhead? How do you get the rocket and payload ready for launch without integrating and stacking the reusable stages?

If you already are the number 1 space company you dont need marketing. All the news of your achievements are right there to read them. Then your launch price speaks for itself.

Tell me how much cost integrating and stacking.

Quote please. That's ridiculous because it implies that for a projected SpaceX launch price at $50 million, each first stage booster alone costs over $35 million dollars!

http://singularityhub.com/2014/04/30/can-elon-musk-and-spacex-take-space-travel-from-evolutionary-to-revolutionary/

http://www.forbes.com/sites/alexknapp/2014/04/25/spacex-falcon-9-reusable-stage-landed-safely-in-the-atlantic/

http://techcrunch.com/2014/04/25/spacex-just-made-a-big-step-towards-cheaper-more-sustainable-space-flight/

http://qz.com/203349/spacex-is-suing-the-us-government-for-a-free-market-in-satellite-launches/

http://www.spacenews.com/article/launch-report/35562spacex-chief-says-reusable-first-stage-will-slash-launch-costs

In reality, we don't have the actual numbers of how much an individual SpaceX launch currently costs (hint: it is way higher than the "projected" price of $50 million) because private contracts are confidential or launch slots are purchased in bulk. The actors in this market only distill incomplete information as they seem fit. When Musk talks about reducing by X%, does he mean compared to current ULA prices? current SpaceX prices? Future SpaceX prices? Does he mean with just one reuse? 10 reuses? First stage only? Manned or unmanned?

We simply don't know, so we can't take anything for granted.

Your numbers are unsubstantiated. I have provided examples and comparisons for mine. Yours are just wishful thinking.

The only that I see from you was a list of things which you believe represent huge values. But you dint give any detail of how much cost each, and you dint post any source of that.

--------------------------------------------------

I will no answer more now, I am sick (no of this discuccion, virus sick)

[cpast]

Out of the way just for 2 or 3 high school problems? The kids are smarted than that.

You seem to be fixated on levels of presumed intelligence - here, you say "those are high school problems" and leave it at that; elsewhere, you've said "if this is the best you've got, the brilliant rocket scientists can of course solve it" -- calling something a high school problem doesn't refute anything. In fact, it just makes your failure to refute it rather glaring. You don't get to handwave counterarguments by saying they're trivial unless they are, in fact, intuitively obvious to the most casual observer - since many members here seem to take issue with your arguments, the issues certainly aren't trivial.

You dont need to build a new booster becouse you can use the same.

I cross out many of your launch cost list with only that.

As mentioned, cost of a booster itself is fairly low. Cost of skilled personnel (and you *will* need to keep people on payroll to produce spare parts, because things *will* break, and you need to replace them) is the dominant factor - while skilled labor is involved with manufacture, and that is less of a need with less production, lower production will just mean higher unit cost - you save less than you might think. Also, a lot of the same sort of people you want for production also are useful for maintenance, so you'll still want them on payroll.

If you already are the number 1 space company you dont need marketing. All the news of your achievements are right there to read them. Then your launch price speaks for itself.

Here we get to the utterly ridiculous.

First off, if you do become effectively a monopoly, you have a *critical* need for good PR - otherwise, you run a risk of being caught by antitrust laws. Governments don't like when there's only one option for something.

Second, your competitors *are* advertising, pointing out all the advantages they have over you, while conveniently neglecting to mention disadvantages. You kind of have to respond to that - no one else will point out your competition's disadvantages, and you will lose your position. Even if your advertising is just to remind people that you're the default choice (along the lines of "no one ever got fired buying IBM"), you need it to be there.

Third, and most importantly, this entire discussion is about opening new markets. No one, bar no one, is going to say "Oh, cool! Launches are only a few million now, so we'll totally launch a satellite even though we hadn't given any thought to how we could possibly use them before!" The people you need to reach aren't going to be paying you the slightest bit of attention - most people just aren't interested in space, and if they can't think of a way it'll help them, it won't come up. You absolutely need heavy marketing to encourage people to want to put things in orbit. Many of these people won't even come to you - they might go to your competition. You have to do the difficult task of advertising to increase the pie, not to make your slice a bigger piece of it. But you absolutely do need to find companies that haven't considered space launches for anything (i.e. almost all of them), and talk up what space can do for them. "It's cheap" doesn't actually sway people if they don't also believe it's useful.

[magnemoe]

Yeah, Google would never jump into something that cost it money.

Like youtube.

Or Motorola.

Or Wallet.

Note that its an huge demand for satellite broadband capacity, kind of hard to draw fiber-optic to planes and ships.

Also US military has bought up as much satellite broadband capacity as they can to run their long range UAV, some chance that marked is growing.

And yes, it would be an marked for larger and more capable satellites if the price would be lower.

One way to reduce latency for satellite communications is to have a net in medium orbit and have the satellites communicate directly with each other.

You communicate with one, it relays the signal to another satellite who might even send it over to yet another before going do an ground station.

[cpast]

Note that its an huge demand for satellite broadband capacity, kind of hard to draw fiber-optic to planes and ships.

Also US military has bought up as much satellite broadband capacity as they can to run their long range UAV, some chance that marked is growing.

And yes, it would be an marked for larger and more capable satellites if the price would be lower.

One way to reduce latency for satellite communications is to have a net in medium orbit and have the satellites communicate directly with each other.

You communicate with one, it relays the signal to another satellite who might even send it over to yet another before going do an ground station.

I fail to see how that could *possibly* reduce latency. Latency is "time I start a transmission to time you start receiving it". Unless a satellite is the original sender and another is the ultimate recipient, relaying will only decrease latency (which is governed by the speed of light).

[xcorps]

Note that its an huge demand for satellite broadband capacity, kind of hard to draw fiber-optic to planes and ships.

Also US military has bought up as much satellite broadband capacity as they can to run their long range UAV, some chance that marked is growing.

And yes, it would be an marked for larger and more capable satellites if the price would be lower.

One way to reduce latency for satellite communications is to have a net in medium orbit and have the satellites communicate directly with each other.

You communicate with one, it relays the signal to another satellite who might even send it over to yet another before going do an ground station.

I was responding to the comment "They are planning to set up a world spanning grid of satellites the provides unrestricable internet access to the planet. It won't be high speed fiber connections, sure, but it doesn't HAVE to be. Especially if the alternative is not having any internet at all! "

That basically means a bunch of satellite connections to provide internet to portions of the worlds which don't have the infrastructure for true broadband. So the next question is: "If you live in a country that can't afford the infrastructure for broadband, how are you going to afford to pay for satellite broadband?"

Very questionable.

And yes, it would be an marked for larger and more capable satellites if the price would be lower.

You think a satellite would be cheaper if the launch price would be lower? If you have any evidence that buss costs would be reduced I'd love to see it. It's like saying building a fire truck is less expensive because rubber boot prices go down.

Also US military has bought up as much satellite broadband capacity as they can to run their long range UAV, some chance that marked is growing

Which has nothing to do with the conversation. If you want to decrease the price of an inelastic good, you must increase the elasticity. You cannot increase the demand elasticity of space travel by lowering prices. You cannot increase demand elasticity with a limited market and an oligarcy.

If you think it's possible to simple ignore the basic principals of economics, I'd like to see your evidence. The point of contention is that lowering prices through reusability of launch vehicles and lowering prices will increase demand. In addition to basic economic fail, the historical precedent is the STS.

So, instead of the rhetoric on the subject, please provide something that supports "cheaper launches = higher demand".

One way to reduce latency for satellite communications is to have a net in medium orbit and have the satellites communicate directly with each other.

You communicate with one, it relays the signal to another satellite who might even send it over to yet another before going do an ground station.

Relevance?

Edited July 2, 2014 by xcorps

[magnemoe]

You seem to be fixated on levels of presumed intelligence - here, you say "those are high school problems" and leave it at that; elsewhere, you've said "if this is the best you've got, the brilliant rocket scientists can of course solve it" -- calling something a high school problem doesn't refute anything. In fact, it just makes your failure to refute it rather glaring. You don't get to handwave counterarguments by saying they're trivial unless they are, in fact, intuitively obvious to the most casual observer - since many members here seem to take issue with your arguments, the issues certainly aren't trivial.

As mentioned, cost of a booster itself is fairly low. Cost of skilled personnel (and you *will* need to keep people on payroll to produce spare parts, because things *will* break, and you need to replace them) is the dominant factor - while skilled labor is involved with manufacture, and that is less of a need with less production, lower production will just mean higher unit cost - you save less than you might think. Also, a lot of the same sort of people you want for production also are useful for maintenance, so you'll still want them on payroll.

Here we get to the utterly ridiculous.

First off, if you do become effectively a monopoly, you have a *critical* need for good PR - otherwise, you run a risk of being caught by antitrust laws. Governments don't like when there's only one option for something.

Second, your competitors *are* advertising, pointing out all the advantages they have over you, while conveniently neglecting to mention disadvantages. You kind of have to respond to that - no one else will point out your competition's disadvantages, and you will lose your position. Even if your advertising is just to remind people that you're the default choice (along the lines of "no one ever got fired buying IBM"), you need it to be there.

Third, and most importantly, this entire discussion is about opening new markets. No one, bar no one, is going to say "Oh, cool! Launches are only a few million now, so we'll totally launch a satellite even though we hadn't given any thought to how we could possibly use them before!" The people you need to reach aren't going to be paying you the slightest bit of attention - most people just aren't interested in space, and if they can't think of a way it'll help them, it won't come up. You absolutely need heavy marketing to encourage people to want to put things in orbit. Many of these people won't even come to you - they might go to your competition. You have to do the difficult task of advertising to increase the pie, not to make your slice a bigger piece of it. But you absolutely do need to find companies that haven't considered space launches for anything (i.e. almost all of them), and talk up what space can do for them. "It's cheap" doesn't actually sway people if they don't also believe it's useful.

Boosters are expensive to build yes you get benefits making many but the cost saving of bulk producing more don't really kick in before you get into real assembly line production like you do with cars. My guess is that the cost saving for each unit would not be much more than 50% if you produced 100 instead of 20 year.

Development cost is fixed anyway, this is part of the critic of the SLS, an huge development cost for an rocket who will just be used a few times.

Aging first stages will probably be used for missions where they have to huge payload to recover the first stage, this will keep the cost of this launches down too, it will also keep the production line up.

And yes SpaceX is betting on capturing an huge faction of the launcher marked. i agree with your analyze of Skylon, it would be too expensive to develop at least just as a launcher. However the reuseable falcon 9 makes a lot of sense, its an pretty cheap upgrade of an existing platform.

Powered landing of fist stages is an good idea, I guess other will copy it even if SpaceX fails.

Russia has the benefit of being able to land downrange without problems however their existing launchers don't look like they are easy to modify like this.

[xcorps]

The arguments are still fixated on the price of launches. The per launch cost is not the only factor. The launch cost is merely a part of the process. You are not buying a launch, you are buying a satellite and paying someone to put the buss in space.

You think people are knocking down the door to spend 8 grand on a satellite that is designed to fall out of orbit and is only good for bouncing HAM radio signals? Some cubesats are going to be launched by the EU and some universities. I'll give you 3 guesses where the universities will get their funding from.

The only money going into cubesats and tubesats right now is from the government and perhaps a few kooks with too much money and not enough to do. That's not a market. If your only source of funding is from government, then you have no real demand. You have an artificially created demand. And that's not a good business model, as evidenced in the housing crisis.

So again, I'm asking for a source that will demonstrate that you can change the elasticity of space flight by lowering launch costs. Not speculation. Not betting. No maybe's, no if's, no but what's....a source that demonstrates that either a change in the market is imminent or a new economic principal that up until Falcon came along remained unknown.

Without a source, you are speculating.

[Nibb31]

You have some good concern, but are similar to any new technology development. This means that nothing is developed? nothing new appear?

You need 20 years of development after you solve all main problems?

Technological advances are incremental. You experiment new solutions by improving things that have been done before. You build prototypes and technology demonstrators to test each individual part of the system.

When you try to include too many new technologies into a single vehicle, which are all essential, you always end up with a final result that doesn't meet expectations. Examples: Space Shuttle, X-33...

SpaceX is a more realistic contender, as it is incrementally improving on existing technology. They don't intend to leap from zero to a fully reusable MCT in one go.

A 50% reduction in launch costs compared to their Atlas or Delta competition is possible (that is $50 million instead of $100 million), but it will be more through lean management and innovative business processes than through reusability and it will not be enough to open up asteroid mining or space tourism markets.

About funds, Skylon is the only card that the Europe comunity may had. You think ESA would let escape that oportunity? When the ESA report about skylon of 1 year of duration finish, they would be sure if it worth fund it or not.

ESA is not funding Skylon. They have funded trade studies for a few thousand dollars.

ESA is having trouble gathering enough money to design Ariane 6, which from the latest news is simply going to be an evolution of Ariane 5. ESA gets its money from governments of member states. In the current economical, no European country is going to suddenly increase ESA funding to build Skylon. That is not going to happen.

Lol, and you think that normal rockets dont use LH2 to cool either? Or that they dont have complex systems? Of course that it would had complex systems, but are not complex enoght to said that it would be a problem.

The main problem is already solve. Now they had 10 years to solve the baby problem which even I can imagine several ways to solve them being almost failures proffs.

Rockets are launched from space centers. You need to either build a huge runway at Guyana Space Center or to build a huge Hydrogen production and storage plant at a major airport in the UK. Do you have any idea how much time and effort goes into these sorts of things? There are environmental impact studies, urbanisation studies. There are expropriations and administrative processes that need to be followed. Yes, it does typically take 20 years to build an airport anywhere in Europe.

So what we do? Nothing? I can not imagine any technological advance with that way to think.

No. We do incremental improvements. SpaceX is on the right track, although they have been promising a lot and they now need to actually deliver. Skylon is just a handful of old dreamers working in a shed.

ESA is doing its research, if they found that it can be done and they calculate the investment cost, they would do it even if it is a lot.

ESA is paying for preliminary trade studies. It's a drop of water compared to the money needed to actually develop any of the technology.

Well, if you think that produce and storage LH2 is a challenge, then I dont know how you survive your average day

It is a challenge. Especially if you want rapid turnaround and several flights per day.

I think that skylon info about development cost is not real (never is), but your estimation is also not real. But even if it is, you are wrong about the real profits that it can have.

So where are your own cost and profit estimates? Where are your examples of similar business models? You started a discussion about economics, but I haven't seen a single number, estimation, or comparison with real-world equivalent industries. Only handwaving tough engineering and political problems away as "easy" or "high school level" or claiming that others are "wrong" without any argumentation.

Edited July 2, 2014 by Nibb31

[Nibb31]

Not true, look at Planetary Resources. Right now they are working on getting up some satellites to help them search for viable candidate asteroids for mining. Their entire existence revolves around designing a mining platform to get at asteroids.

Planetary Resources' business model is to develop flashy Powerpoint presentations to attract venture capital investors and government grants to keep the company afloat. Sometimes you get a mockup or a trade study, but the main business objective of these companies is keep a paycheck coming in for their CEOs. This is not uncommon in the "New Space" sector: Golden Spike, Mars One, Excalibur Almaz, RocketPlane Kistler, JP Aerospace and yes, Skylon all fall into the same category for me.

Wake me up when any of these companies sends up a real spacecraft and has a sustainable business model.

One of the things to also keep in mind is that the space launch sector is actually a GROWING business. Companies WANT to utilize satellites, and slowly companies are beginning to develop modular and multipurpose spaceframes (the structure of the satellite) instead of reinventing the wheel for every craft ever launched, which drastically reduces the costs of the payloads.

Common spacecraft busses have been around since the 70's. They're nothing new. They are mostly for GEO comsats, which usually share the same requirements.

Somewhere here someone mentioned that nobody is going to want space-communications with the latency inherent in satellite communications. Tell that to Google. They are planning to set up a world spanning grid of satellites the provides unrestricable internet access to the planet. It won't be high speed fiber connections, sure, but it doesn't HAVE to be. Especially if the alternative is not having any internet at all!

There have been lots of plans for LEO constellations, but none of them have been successful (Iridium comes to mind...). Will it be cheaper than land-based LTE towers? How big is the actual market in areas that don't have access to LTE? It will be interesting if Google succeeds, but they would need what, 20 to 30 launches, to build their constellation? That's a nice contract for any launch provider, but that's doesn't make a business model.

Yeah, Google would never jump into something that cost it money.

Like youtube.

Or Motorola.

Or Wallet.

Or the dozens of other projects that they have started and abandoned: Orkut, Checkout, Wave, Reader, Latitude, Buzz ...and Motorola!

Google has a habit of trying lots of different things and abandoning them half way through. They have lots of cash to spend, so it's not stupid to spend it on new ideas to see what sticks. But they accept the fact that some of them will fail.

Edited July 2, 2014 by Nibb31

[PakledHostage]

So for you testing is equal to maintenance?? I would not even bother to explain the difference.

Well if you are so well versed in the difference between testing and maintenance, then you would also know that maintenance involves testing. Complex systems like rockets or aircraft only work reliably if you perform routine maintenance. Routine maintenance requires testing because faults are often latent (meaning you don't know about them until you test for them).

Commercial airliners are required to undergo "checks" at regular intervals, where the aircraft comes in to the hangar and mechanics perform routine tests on the aircraft's systems and structure. These checks range from overnight hangar visits every couple of weeks to more extended hangar visits every year or so, to complete overhauls requiring a month or more every 6-8 years. And don't, for a second, believe that problems aren't discovered during those tests. Dispatch reliability and safety of modern airliners is very good because the aircraft are designed with built in redundancy, but I guarantee you that every aircraft you have ever flown on had at least one deferred maintenance item and many more latent maintenance problems. The significant additional cost of designing, building and maintaining those redundant systems is necessary to maintain dispatch reliability and safety of commercial airliners. Reusable rockets will only be more critical and expensive to maintain and test because they are operated in harsher environments and with thinner performance margins.