Impact of SpaceX rideshare on small sat launchers market

[matthewkantar]

The claim that SpaceX is calling investors is not plausible. Who at SpaceX is making these calls? Who received them? No names, no numbers just an empty charge.

[RedLineTrain]

Riddle me this:
...

Outside of niche requirements, small sat launchers were always going to get squished. Their high cost per tonne has always meant that larger rockets with lower per-tonne costs were Swords of Damocles hanging over their corporate models,
...

That.
It never made sense.

Which is exactly why SpaceX pivoted away from Falcon 1 as soon as they could. Back in 2005 Musk et al already understood that small launchers have no future because they don't really help in reducing the cost of access to space.

True, and overall, launch is a tough and unrewarding business.  Even for the big rockets.  Bezos is burning a king's ransom for no good reason.

[M.E.T.]

Elon's response to all this whining:

https://twitter.com/elonmusk/status/1795791386668618095

"We don’t use patents, except to block patent trolls, so others are free to copy us. SpaceX is building the technology to extend consciousness beyond Earth, so the cost per ton to orbit & beyond must necessarily be low enough to accomplish that goal."

[bstrong]

1. Within a few years there will be many US medium and heavy vehicles in service including Falcon, Starship, Vulcan, New Glenn, Terran R, MLV, Neutron, and Nova. Furthermore the NSSL program is structured to ensure that at least 2-3 US companies will have successful heavy launch vehicles. So there's already government support for a competitive launch market.
...

You're assuming these companies will be able to stay in business and fund the development of all these new medium launch vehicles (which will likely take longer and cost more to bring into service than they are all currently projecting). With the exception of Blue and ULA, I think that is very far from guaranteed.

IMO, everyone else will need a lot of help to get to the point that they can compete for NSSL launches. Fortunately they are already getting some in the form of various USG launch contracts, but they'll probably need quite a few more in the next few years.

[WmThomas]

Up thread, there was discussion of the implication that a May 2019 meeting between Elon Musk and Peter Beck sparked SpaceX to offer rideshare missions.

But unmentioned in that narrative is the Spaceflight Industries "SSO-A" mission (Dec. 3, 2018), wherein Soaceflight booked an entire Falcon 9, then sold off opportunities to fly equipment on it. It worked, but was a pain in the neck for SpaceX, as I recall, and SpaceX and Spaceflight had a big falling out, though I believe Spaceflight had originally thought they would launch more of these kinds flights with SpaceX.

Still, when Space later stood up the Transporter missions, I thought we all saw it was because Spacex had seen how well the Spaceflight SSO-A flight sold, and figured they could run the same kind of thing more effectively themselves.

[meekGee]

Elon's response to all this whining:

https://x.com/elonmusk/status/1795791386668618095

"We don’t use patents, except to block patent trolls, so others are free to copy us. SpaceX is building the technology to extend consciousness beyond Earth, so the cost per ton to orbit & beyond must necessarily be low enough to accomplish that goal."

Ooh we went from making humanity interplanetary to extending consciousness itself beyond Earth.

I liked the first version better, but alas, it's his dime

[DJPledger]

RocketLab, Relativity, and other LV companies are only crying wolf because they have been unable to deliver products that can effectively compete with SpaceX. This is the reality of the free market. You must compete effectively or shut up shop and go home.

Other LV companies need to deliver competitive MLV's and HLV's to survive against SpaceX and the future of SLV's is non existent. LV startups often start with SLV's as technology testbeds but need to scale up to larger LV's to be competitive in the free launch market. LV companies that are unable to go bigger than SLV's due to funding etc. will most likely go to the wall.

If RocketLab can't get Neutron launching frequently within the next few years then they may well go bust.

[RedLineTrain]

For most definitions of "competition," you're not really competing unless in a couple of years, you have a high flight rate fully reusable SHLV plus a captive megaconstellation roughly equivalent to Starlink.  Neutron probably won't cut it.

I know this sounds harsh and unreasonable, but Falcon 9 itself is proving to be an extinction-level event, let alone Starship.  Absent Starship, Falcon 9 will be flying 250-300 times in 2026 (the vast majority of which will be packed to the gills).  Nobody had this in their business plans that they used to justify their launch investments.

Living on scraps from a sparsely-laid table doesn't seem satisfying to me.  It will be just jumping from one minimum viable product waypoint to another, with no end in sight.  Table stakes in the tens of billions of dollars.

[trimeta]

Ultimately, it seems like the conclusion from this thread is "There is room for exactly one US launch provider." Note that I didn't say small launch provider: SpaceX is so far ahead that in a few years, there will be <10 non-SpaceX US launches annually, all of which are NSSL launches contractually handed out to whichever company the US government decides to keep alive. It's not SpaceX's fault that they're exploiting the natural monopoly in this launch domain; sure, they're doing what they can to take advantage of it, but that's just good business. If other companies want to be launch providers too, they should invent time travel, since that's more plausible than surviving as a launch company so long as SpaceX exists.

[RedLineTrain]

SpaceX could screw it up.  Unlikely, but somewhat more likely than inventing time travel.

[Athelstane]

For most definitions of "competition," you're not really competing unless in a couple of years, you have a high flight rate fully reusable SHLV plus a captive megaconstellation roughly equivalent to Starlink.  Neutron probably won't cut it.

I know this sounds harsh and unreasonable, but Falcon 9 itself is proving to be an extinction-level event, let alone Starship.  Absent Starship, Falcon 9 will be flying 250-300 times in 2026 (the vast majority of which will be packed to the gills).  Nobody had this in their business plans that they used to justify their launch investments.

Living on scraps from a sparsely-laid table doesn't seem satisfying to me.  It will be just jumping from one minimum viable product waypoint to another, with no end in sight.  Table stakes in the tens of billions of dollars.

Yes, but there are major payload customers with a vested interest in having another launch provider than SpaceX, and they are not all named "the Defense Department." That alone guarantees one other major player in the U.S. launch market.

[kenny008]

Ultimately, it seems like the conclusion from this thread is "There is room for exactly one US launch provider." Note that I didn't say small launch provider: SpaceX is so far ahead that in a few years, there will be <10 non-SpaceX US launches annually, all of which are NSSL launches contractually handed out to whichever company the US government decides to keep alive. It's not SpaceX's fault that they're exploiting the natural monopoly in this launch domain; sure, they're doing what they can to take advantage of it, but that's just good business. If other companies want to be launch providers too, they should invent time travel, since that's more plausible than surviving as a launch company so long as SpaceX exists.

I’m really trying hard to understand what YOU’RE conclusion is.  Nothing illegal is being done, since no other competitors are suing SpaceX, so it appears it is just their (legal) business practices you object to.  Even the business practices you object to are those vocalized by the competitors themselves, so we have to take their word that their allegations are true in the first place.

What do you feel should happen at this point:

1. SpaceX should be forced to raise their prices until it matches other potential launch providers?

2.  Other launch providers should be subsidized until they can catch up and provide their own cheap launch?

3.  Customers should be incentivized to purchase more expensive launches so they don’t have a monopoly to contend with in the future?

4.  Something else?

I’m just trying to understand your position.

[trimeta]

For most definitions of "competition," you're not really competing unless in a couple of years, you have a high flight rate fully reusable SHLV plus a captive megaconstellation roughly equivalent to Starlink.  Neutron probably won't cut it.

I know this sounds harsh and unreasonable, but Falcon 9 itself is proving to be an extinction-level event, let alone Starship.  Absent Starship, Falcon 9 will be flying 250-300 times in 2026 (the vast majority of which will be packed to the gills).  Nobody had this in their business plans that they used to justify their launch investments.

Living on scraps from a sparsely-laid table doesn't seem satisfying to me.  It will be just jumping from one minimum viable product waypoint to another, with no end in sight.  Table stakes in the tens of billions of dollars.

Yes, but there are major payload customers with a vested interest in having another launch provider than SpaceX, and they are not all named "the Defense Department." That alone guarantees one other major player in the U.S. launch market.

The argument is basically that "the Defense Department" is the only organization which cares about "assured access to space" enough to pay significantly more for a second provider. So they would be the only payload customer for this second company. Which would be ULA, or whoever purchases ULA (*cough* Blue Origin *cough*).

[trimeta]

Ultimately, it seems like the conclusion from this thread is "There is room for exactly one US launch provider." Note that I didn't say small launch provider: SpaceX is so far ahead that in a few years, there will be <10 non-SpaceX US launches annually, all of which are NSSL launches contractually handed out to whichever company the US government decides to keep alive. It's not SpaceX's fault that they're exploiting the natural monopoly in this launch domain; sure, they're doing what they can to take advantage of it, but that's just good business. If other companies want to be launch providers too, they should invent time travel, since that's more plausible than surviving as a launch company so long as SpaceX exists.

I’m really trying hard to understand what YOU’RE conclusion is.  Nothing illegal is being done, since no other competitors are suing SpaceX, so it appears it is just their (legal) business practices you object to.  Even the business practices you object to are those vocalized by the competitors themselves, so we have to take their word that their allegations are true in the first place.

What do you feel should happen at this point:

1. SpaceX should be forced to raise their prices until it matches other potential launch providers?

2.  Other launch providers should be subsidized until they can catch up and provide their own cheap launch?

3.  Customers should be incentivized to purchase more expensive launches so they don’t have a monopoly to contend with in the future?

4.  Something else?

I’m just trying to understand your position.

Probably #2, mostly in the form of government launch contracts going to non-SpaceX providers (plural!) even if it would make more economic sense for the government to exclusively use SpaceX. Which really is what the various CEOs were trying to achieve with their interviews with the NY Times: this is all lobbying by means of trying to sway public opinion, to get Congress to send more contracts their way.

If RedLineTrain's comment earlier about "If you are a monopoly, you have a different rulebook [regarding antitrust law]" is valid, maybe a bit of investigation to see if responses pursuant to #1 are warranted. But I don't know the law enough to know if "using your monopoly position to kill off potential competitors" is actually illegal assuming you're never selling products for under cost, and if it isn't, then there would be no need for an investigation.

[RedLineTrain]

"Assured access to space" is such a meaningless slogan, whether uttered in the US or Europe by government or commercial buyers.  Consider that the table stakes have become so high on the payload side that even ULA hitting its stride and maxing out its manufacturing capacity could not provide this access.  For instance, the Starshield constellation itself represents more flights than Vulcan can offer, at 10x the price.

[trimeta]

"Assured access to space" is such a meaningless slogan, whether uttered in the US or Europe by government or commercial buyers.  Consider that the table stakes have become so high on the payload side that even ULA hitting its stride and maxing out its manufacturing capacity could not provide this access.  For instance, the Starshield constellation itself represents more flights than Vulcan can offer, at 10x the price.

So you believe the Department of Defense should abandon its "maintain two providers" approach and accept the inevitable SpaceX monopoly? Meaning that there would be exactly one launch company in the US, period? (I'm assuming that Europe would continue fielding the Ariane 6, and Japan the H3, regardless of economics.)

[RedLineTrain]

"Assured access to space" is such a meaningless slogan, whether uttered in the US or Europe by government or commercial buyers.  Consider that the table stakes have become so high on the payload side that even ULA hitting its stride and maxing out its manufacturing capacity could not provide this access.  For instance, the Starshield constellation itself represents more flights than Vulcan can offer, at 10x the price.

So you believe the Department of Defense should abandon its "maintain two providers" approach and accept the inevitable SpaceX monopoly? Meaning that there would be exactly one launch company in the US, period? (I'm assuming that Europe would continue fielding the Ariane 6, and Japan the H3, regardless of economics.)

Honestly, I don't know what to do when faced with a market that is winner-takes-all.  At a minimum, I think support should be justified on other grounds than "assured access to space."  Consider the assumptions that are inherent in such a slogan.  It assumes that one guy can be made to be the same as the next guy (in a pinch).  But nobody or combination of nobodies can replace the capacity that SpaceX is putting online, within an order of magnitude of price or quantity.  It's just unrealistic to state that somebody is providing you that.

In other contexts, the military accepts single suppliers.  It is familiar with such arrangements.  It seems likely that they would be more or less comfortable with such in space launch, if that single supplier is performing well.

[M.E.T.]

Ultimately, it seems like the conclusion from this thread is "There is room for exactly one US launch provider." Note that I didn't say small launch provider: SpaceX is so far ahead that in a few years, there will be <10 non-SpaceX US launches annually, all of which are NSSL launches contractually handed out to whichever company the US government decides to keep alive. It's not SpaceX's fault that they're exploiting the natural monopoly in this launch domain; sure, they're doing what they can to take advantage of it, but that's just good business. If other companies want to be launch providers too, they should invent time travel, since that's more plausible than surviving as a launch company so long as SpaceX exists.

The fundamental issue is that launch companies are up against a maverick genius who has an almost obsessive capacity to double down and risk his entire business on the next leap forward even after his previous, highly risky gambit has provided a 10x jump ahead of his more conservative rivals.

First he bets all his Paypall winnings on starting a rocket company. Everyone laughs. Insane, right. He succeeds.

Then he immediately bets the launch company on building a large, reusable rocket. Everyone laughs again. He succeeds again.

Then he immediately bets the only reusable launch company in the world on building the largest satellite constellation in history - an area where all previous attempts have ended in bankruptcy. Everyone laughs REALLY hard.

He succeeds and now his reusable launch company has such launch economies of scale that no competitor has a hope of competing.

Is he happy? Nope. He immediately bets his utterly dominant launch company on building the largest, most insane fully reusable rocket in history which will immediately obsolete his already unbeatable Falcon 9 rocket - you know, the one would be competitors are already whining about since they can’t compete against it.

And then people wonder why some of us say trying to enter the launch market now is a fools errand. The problem for every other launch company is they don’t have Elon.

[chopsticks]

In other contexts, the military accepts single suppliers.  It is familiar with such arrangements.  It seems likely that they would be more or less comfortable with such in space launch, if that single supplier is performing well.

Consider this (not pleasant but bear with me) - there is a loss of crew on F9 and it is grounded for an indefinite period of time. There is no more guaranteed access to space with such a single provider. I would venture to say that the stakes are probably quite a bit higher for LVs than for the examples of the military, although I don't know what sort of examples you're referring to and how they would apply.

Very much disagree that "assured access to space" is a meaningless statement. Wise to not put all of your eggs in one basket and subsidize other LVs if need be.

SpaceX if still a private company and could still fail, even though it doesn't seem likely right now.

[Asteroza]

"Assured Access" is such a tarpit phrase.

The real components of that are

1. Launch on demand
2. Launch services diversity for the same capabilities

1 can functionally exist with an effective monopoly if there is sufficient launch cadence to allow real payload fungibility. SpaceX is currently demonstrating this arrangement. It's not yet clear if the market can support two or more launch providers each at that cadence, and if it can do so without an intrinsic partnership with a megaconstellation (reusable vehicle or not).

2. This is a manifestation of the 2 dissimilar vehicle rule for a given class of payload (mass and/or orbit requirements) that also manifests payload fungibility via minimum interfaces (payload adapter commonality, shared fairing volume/shaping). The conceit here is launch cadence is constrained enough that a vehicle standdown during a failure investigation is painful enough that sufficient flexibility in the other provider to cover for the loss of spacelift is necessary to maintain a minimum cadence capability. But that minimum cadence capability is presupposed on what? Most sats are years in the making, almost none are spares ready to go sitting on a shelf. Where is this nascent need for sats waiting for specific taskings to be launched (like older film based spysats), there was only that recent Victus Nox mission for Firefly right? If nobody is fronting sats sitting in warehouses and paying a launch retainer fee to not one but at least two launch providers then that argument disappears in a puff of smoke as it's strictly a "nice to have" as long as the money doesn't materialize.

Now if Falcon 9 had a new mission failure, the inability for other providers to gapfill cadence (discounting starlink) may be a concern. Kuiper is effectively consuming most cadence flexibility in the rest of the market despite having a captured launcher (New Glenn) and still needs Falcon 9 (though that is from deployment deadline pressure rather than general deployment cadence per se)