Author Topic: Viability of a Private/Commercial Space Hotel  (Read 7098 times)

Offline Chalmer

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Viability of a Private/Commercial Space Hotel
« on: 11/20/2013 05:08 PM »
Hi there,

Okay I have been looking at the possibility of a Space Hotel, not from a technical point of view but from a financial and business plan one. I think all, or at least many of us can agree that the technical aspects arent the big problem. The hotel is self could be from Bigelow, a ISS-type module from ThalesAlenia, or a Russian type module. The ride up there could be from DragonCrew, CST-100 or Dreamchaser (I believe that at least one will succeed), or a Soyuz.

So the technology should be there at least within the next 5 years time.

I have constructed a timeline of costs and income based on DragonCrew, F9, FH, and Bigelows Astronaout flight costs.

My baseline is as follows,

Bigelow Develops and Constructs a single module Hotel over the next 5 years (2014-2018), and launch it on a Falcon Heavy in 2019 (FH should have flown several times by then). The hotel have a life time in orbit of 15 years (2019-2033)

Space Tourists flights also start in 2019, 2 flights per year in a DragonCrew(Should be in ISS service by then) on an F9 with 6 tourists and one pilot (12 yearly tourists). Each tourist pays $26.25 Mill. in 2014 money all years (presumably this would be inflation adjusted in real life).

I have included some fixed and variable cost for station up keep and launch and support etc.

See picture for the results. With 2 flights of 6 tourists the case just closes. Some may argue that some of my price estimates are completely of base, and i welcome that, but please give a reason why. Also, i have not included rack lease like Bigelow is aiming for and i have kept the number of tourists per year relatively low and constant. It is a simple model, and it might be more realistic to say have fewer tourists in the first years and more later on, and also change the price along the way. Many examples can be thought of.

I however think that this is a good starting point. Also it shows that it might not be bad business over time, but the main problem seem to be the high entry cost of financing >$700 mill. during the development, construction and launch. While income is unknown.
 

Offline Danderman

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Re: Viability of a Private/Commercial Space Hotel
« Reply #1 on: 11/20/2013 05:29 PM »
A lot depends on there being 6 paying customers per flight at $26M a ticket.

Also, the "10 million per trip" line item for support/food, etc is waaaaaaaay low.

Basically, your revenues are optimistically high, and your ongoing expenses are optimistically low.


« Last Edit: 11/20/2013 05:31 PM by Danderman »

Offline Chalmer

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Re: Viability of a Private/Commercial Space Hotel
« Reply #2 on: 11/20/2013 05:55 PM »
A lot depends on there being 6 paying customers per flight at $26M a ticket.

Also, the "10 million per trip" line item for support/food, etc is waaaaaaaay low.

Basically, your revenues are optimistically high, and your ongoing expenses are optimistically low.

Perhaps 10 mill. per trip is to low. But what would be a better estimate? I didn't write the assumed time spent at the hotel, which i probably should have. I assume something in the order of 10-20 days. Given that timeline what would be a better estimate of associated costs?

Just stating some assumptions are low and other are high without qualifying why and what a better estimate is, is meaningless.

and of cause it depends heavily on there being costumers. But 12 people a year is not completely unrealistic. Also given the timeline of 2019-2033 suborbital flight might have primed the market for orbital launch.

Offline Lurker Steve

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Re: Viability of a Private/Commercial Space Hotel
« Reply #3 on: 11/20/2013 06:51 PM »
If you assume your space hotel gets visitors once a quarter, that means you probably need a minimum of 4 crewed vehicle flights, plus 2-3 logistics flights per year. Of course, you could put crew and cargo on the same launch, but that dramatically reduces the number of passengers.
 

Offline Chalmer

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Re: Viability of a Private/Commercial Space Hotel
« Reply #4 on: 11/20/2013 07:27 PM »
If you assume your space hotel gets visitors once a quarter, that means you probably need a minimum of 4 crewed vehicle flights, plus 2-3 logistics flights per year. Of course, you could put crew and cargo on the same launch, but that dramatically reduces the number of passengers.

I assumed cargo would go up with the crew. 6 passengers and 1 pilot + cargo might be overoptimistic. In a ten day mission that is food and water of about 300 kg.

Having a dedicated cargo flight is really expensive since there are no passengers to pay for it (Cost would be spread over passengers on other flights). However if you could get commercial costumers that need experiments flown up and installed and thereby can generate a new revenue stream it might pay for it self. tourists would then also have something to do during the stay, after floating around in circles stop being funny   ;D
This may also create corporate costumers (as crew) that want to run experiments in space. I didnt include this i my setup, since i was trying to keep it simple. I will make some revisions ans see how it looks.

Offline Chalmer

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Re: Viability of a Private/Commercial Space Hotel
« Reply #5 on: 11/20/2013 07:58 PM »
Okay I have added some more items;

- Resupply via Cygnus or Dragon at a cost of 95 Mill. Resupply is set to happens with every other mission.
- I've increased cost of Other services as response to Danderman, from 10 to 15 mill. per mission.
- Payment for experiments of 25 mill per mission.
- Government utilization of the station for 10 mill. per mission after 2028
- I also now start at 1 mission first year and then progress slowly to 4 missions in the last 5 years.

All this means that there now is a small surplus of 150 mill. nominally, but a NPV of minus 160 mill.

I still think that a guy like Bigelow, if he could buy this deal he would.

Offline guckyfan

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Re: Viability of a Private/Commercial Space Hotel
« Reply #6 on: 11/20/2013 08:21 PM »
IMO the biggest risk factor is the number of space tourists. If you can get enough for 2 or 3 full Dragons a year it may be possible.

About logistics and cargo. There is a possible solution that would not need separate logistics flights. Falcon 9 has enough payload capacity that a separate cargo module could be placed into the trunk, maybe an extended trunk. There would be some development cost but as this is a passive module it should not be too expensive. This way there could be a good  supply of food and consumables.

But I think a combined research and hotel facility with at least two modules may be easier to run cost effective.

Offline oldAtlas_Eguy

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Re: Viability of a Private/Commercial Space Hotel
« Reply #7 on: 11/21/2013 12:42 AM »
At $30M for pure tourism the number of tourists a year would be fortunate to have as many as 2 a year.  (This is supported by past history of tourists to orbit.) But if you add researchers (governments and commercial funded), then keeping 2 BA330's full with 6 to 12 persons and 4 to 8 crew flights and 6 to 12 cargo flights becomes feasible.

But if you can drop the tourism price in half to $15M you may be able to increase tourists by a factor of 3 to as many as 6 per year or one full crew flight. Drop it to as low as $10M and you may have enough tourists to fill 2 flights per year. Continuing to drop prices to as low as $5M and you may have enough tourists for 4 or 5 dedicated tourist flights per year nearly enough for a dedicated  1 or 2 BA330 based Space Hotel.

P.S. BTW a 1st stage reusable F9 and reusable Dragon can drop the per seat price for transport to <=$15M for only 6 paying passengers per flight. Higher flight rates may involve firther savings.
« Last Edit: 11/21/2013 12:46 AM by oldAtlas_Eguy »

Online QuantumG

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Re: Viability of a Private/Commercial Space Hotel
« Reply #8 on: 11/21/2013 12:49 AM »
At $30M for pure tourism the number of tourists a year would be fortunate to have as many as 2 a year.  (This is supported by past history of tourists to orbit.)

If you say so.. when the Soyuz price was around $30M there was a glut of applicants, who never got a seat. When you consider that this entailed going to Russia for over a year for training, that's quite a lot more interest than what you're saying.


« Last Edit: 11/21/2013 12:49 AM by QuantumG »
When someone is wishing for a pony, there's little to be gained by suggesting a unicorn would be ever better.. ya know, unless it's sarcasm.

Offline StealerofSuns

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Re: Viability of a Private/Commercial Space Hotel
« Reply #9 on: 11/21/2013 01:58 AM »
Could one consider the possibility of launch costs being reduced significantly by the time Bigelow's habitats are up and running?
Our remote descendants, safely arrayed on many worlds throughout the Solar System and beyond, will be unified by their common heritage, by their regard for their home planet, and by the knowledge that, whatever other life may be, the only humans in all the Universe come from Earth. -Sagan

Offline IRobot

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Re: Viability of a Private/Commercial Space Hotel
« Reply #10 on: 11/21/2013 08:02 AM »
About logistics and cargo. There is a possible solution that would not need separate logistics flights. Falcon 9 has enough payload capacity that a separate cargo module could be placed into the trunk, maybe an extended trunk. There would be some development cost but as this is a passive module it should not be too expensive. This way there could be a good  supply of food and consumables.
That would require an airlock and EVA's to retrieve them. Or some sort of small cargo airlock with a robotic arm to place the supplies there... Any options adds a lot of complexity and cost.

Also Dragon might still be delta-v limited and might not be able to lift 7 people and a couple of tonnes of cargo.

Offline guckyfan

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Re: Viability of a Private/Commercial Space Hotel
« Reply #11 on: 11/21/2013 09:17 AM »
That would require an airlock and EVA's to retrieve them. Or some sort of small cargo airlock with a robotic arm to place the supplies there... Any options adds a lot of complexity and cost.

Also Dragon might still be delta-v limited and might not be able to lift 7 people and a couple of tonnes of cargo.

They need a separate adapting point for cargo anyway. Yes they would need a robotic arm. Or they use the same kind of docking port as the manned Dragon and let Dragon place the cargo pod. Even 1 ton would be amajor enhancement of capabilities. That would limit size of delivered items, not so good if the station is used for research also. If they do research they want a robotic arm and some cargo berthing mechanism.

If they can go fully reusable separate flights may be a better option though.


Delta-v I don't know. Probably Falcon 9 can do most of it and Dragon mostly maneuvering and return.

Offline Chalmer

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Re: Viability of a Private/Commercial Space Hotel
« Reply #12 on: 11/21/2013 03:45 PM »
Could one consider the possibility of launch costs being reduced significantly by the time Bigelow's habitats are up and running?

Yes, if SpaceX is successful in achieving partial or even full re-usability it is a real possibility that launch costs, which again in this example is the main costs driver and hurdle, might become lower.

About logistics and cargo. There is a possible solution that would not need separate logistics flights. Falcon 9 has enough payload capacity that a separate cargo module could be placed into the trunk, maybe an extended trunk. There would be some development cost but as this is a passive module it should not be too expensive. This way there could be a good  supply of food and consumables.
That would require an airlock and EVA's to retrieve them. Or some sort of small cargo airlock with a robotic arm to place the supplies there... Any options adds a lot of complexity and cost.

Also Dragon might still be delta-v limited and might not be able to lift 7 people and a couple of tonnes of cargo.

Added cargo capability of crewed dragon would definitely make the project close much easier, since you would need fewer launches. I don't know how much cargo there is room for with seven people in the dragon or even how many extra kilos it will be able to bring up. But 7 people should not weigh much more than 1000 kg incl. their suits and stuff, so 300-500 kg of cargo should be doable if there is room for it.

Having a pressurized pod in the trunk that could be retrieved by a robotic arm (which would be a good idea to have in any case) could be a solution too, that could save at least some of the cargo flights.

Online A_M_Swallow

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Re: Viability of a Private/Commercial Space Hotel
« Reply #13 on: 11/21/2013 03:51 PM »
Bigelow is sending BEAM to the ISS.  He has talked about turning one into an airlock by adding a second door.  So attaching one of these to a BA330 is a technically possible.

Offline veedriver22

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Re: Viability of a Private/Commercial Space Hotel
« Reply #14 on: 11/21/2013 05:35 PM »
 Maybe eventually some of the cost could be paid for via advertising.  Not sure if there would be enough TV time to make it work.  Also might have some businesses buying space.   I know if I went up I would much rather eat something from a restaurant rather than conventional space food.  Although that is probably a lot better than it used to be.

Offline Danderman

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Re: Viability of a Private/Commercial Space Hotel
« Reply #15 on: 11/22/2013 04:22 PM »
This kind of analysis cannot be taken seriously, in the sense of someone using it as a template for a real space venture. The principle problem is lack of a concept of operations - without which the expenses cannot be taken seriously.

There is therefore a lot of magic in the expense side of the analysis. Basically, the analysis starts with zero expenses, and then adds in what expenses are known. The reverse needs to occur - start with the ISS US Segment operating budget, and remove those expenses that can be determined are not required for this venture.

One last note - what is the plan for visiting vehicles to attach to the station?

Offline Oli

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Re: Viability of a Private/Commercial Space Hotel
« Reply #16 on: 11/22/2013 06:20 PM »
NASA ISS Operation and Management expenditures in 2013: $1493m (doesn't include research and transportation, another 1.5bn).

We ignore the russians/japs/euros and their billions of contributions. Lets say it accounts for inefficiency or supplies that aren't needed for a simple hotel.
 
6 people to the station every 2 weeks + 5 cargo flights for $100m/launch (31 launches a year).

(1493+31*100)/(26*6) = ~30m per seat.

Doesn't include building the station.

Will you find 156 tourists a year for that price?  ;)
« Last Edit: 11/22/2013 06:40 PM by Oli »

Offline pathfinder_01

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Re: Viability of a Private/Commercial Space Hotel
« Reply #17 on: 11/22/2013 06:54 PM »
NASA ISS Operation and Management expenditures in 2013: $1493m (doesn't include research and transportation, another 1.5bn).

We ignore the russians/japs/euros and their billions of contributions. Lets say it accounts for inefficiency or supplies that aren't needed for a simple hotel.
 
6 people to the station every 2 weeks + 5 cargo flights for $100m/launch (31 launches a year).

(1493+31*100)/(26*6) = ~30m per seat.

Doesn't include building the station.

Will you find 156 tourists a year for that price?  ;)

Some of the ISS expenses vs. a private station can be lower due to improvements in technology (i.e. Ground staff could be reduced. The TDRS system can in theory be replaced with a small satellite and purchasing time on commercial com satellites.) And due to it being run for profit (i.e. only employing enough people to get the job done.).
« Last Edit: 11/22/2013 06:54 PM by pathfinder_01 »

Offline Oli

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Re: Viability of a Private/Commercial Space Hotel
« Reply #18 on: 11/22/2013 07:26 PM »
^

I ignored supplies by HTV/Progress. I ignored international contribution to operation. I ignored the cost of actually building a station. I ignored the fact that you probably need additional people up there to maintain/operate the station instead of tourists.

And yet you still feel its necessary to bring up the "private can do everything NASA does at a fraction of the cost" "argument". You think people at NASA are not motivated enough to spend their budget on other things than ISS operation?
« Last Edit: 11/22/2013 07:26 PM by Oli »

Offline pathfinder_01

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Re: Viability of a Private/Commercial Space Hotel
« Reply #19 on: 11/22/2013 07:42 PM »
^

I ignored supplies by HTV/Progress. I ignored international contribution to operation. I ignored the cost of actually building a station. I ignored the fact that you probably need additional people up there to maintain/operate the station instead of tourists.

And yet you still feel its necessary to bring up the "private can do everything NASA does at a fraction of the cost" "argument". You think people at NASA are not motivated enough to spend their budget on other things than ISS operation?

 Nah I am not for everything being private, but I do think it may be near the time where a commercial station has a small shot of working and by law they are limited to spend the whole budget on operations. A space station can be built in such a way that it does not need to be crewed 100% of the time. Skylab for instance was pretty functional (if empty) without its crew.  I do think you will need additional people to operate the station beyond tourist but space station crews have been as small as two people.

In theory using commercial rockets, assembling more on the ground and inflatables should cost less than the heavy on orbit assembly and shuttle dependence of the ISS. The real problem is if the costs can come down enough for profit.  An resupply mission of Cygnus or Dragon could be had for about $154-$237 and could contain enough supply to keep a crew for 2-3 months (depending on size of crew and efficiency of the life support system. ).  A crewed flight is a real unknown but if you donít have to developed the manned spacecraft and the station it helps not to mention that the commercial crew spacecraft are aiming for reusability which means the owner might be willing to make a small deal for profit.

Also in theory a space station is nothing but a satellite. Why do unmanned satellites of varying sizes need MUCH less staff to keep functioning but the station need WAY, WAY more? Yeah it is manned and yes there are special issues to it being manned but there are also lots of things on earth that are man or unmanned and the staffing ratio doesn't explode near as much.
« Last Edit: 11/22/2013 07:54 PM by pathfinder_01 »

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