Text settings Story text Size Small Standard Large Width * Standard Wide Links Standard Orange * Subscribers only Learn more Minimize to nav For two decades, largely in service to the International Space Station, NASA has sought to foster an “economy” in low-Earth orbit. Twenty years ago, with a program to develop private spacecraft for cargo delivery to the space station, NASA sought to “stimulate efforts within the private sector to develop and operate safe, reliable, and cost-effective commercial space transportation systems.” In recent years this has expanded to creating an entire commercial ecosystem in orbit, with transportation, space stations, manufacturing, tourism, and more, such that NASA is one of many customers in the market. In April 2024, the space agency explicitly laid out its philosophy: “NASA supports a robust commercial space economy that advances American industry and promotes technological discovery through in-space work and research. NASA remains committed to fostering innovation and collaboration within the American space industry.” But just two years later, there are growing questions about the viability of this.
As the second space race heats up, NASA has become more interested in focusing on the lunar surface, with a robust Moon base. SpaceX has signaled it no longer wants to be in the business of flying astronauts into low-Earth orbit. Today, the grand plans for a low-Earth orbit economy, at least involving humans, appear to be going sideways. So what happened, and why does it matter?
Ars spoke with a number of industry sources, on background, to provide some answers. Q. What precipitated this crisis? A.
In recent months, SpaceX has made it clear to NASA that it no longer wishes to fly its Crew Dragon spacecraft, or the Falcon 9 rocket, on missions to low-Earth orbit. The company has agreed to support the International Space Station until 2030. But after that, SpaceX intends to retire the spacecraft. SpaceX has told companies developing private space stations for low-Earth orbit, including Axiom Space, Voyager Space, and Vast Space, that they cannot order Crew Dragon missions for their habitats.
Q. Can NASA compel SpaceX to keep flying Dragon? A. NASA invested $3.1 billion in the development and certification of Crew Dragon as part of the Commercial Crew Program.
But SpaceX was only compelled to fly half a dozen missions. It has flown 13 missions for NASA to the space station, and will launch another one in a few days. The company had recently agreed to keep flying through the Crew-17 mission. SpaceX has therefore more than fulfilled its contract obligations to NASA.
Q. But isn’t NASA a really important customer for SpaceX? A. It was in the past, yes.
But SpaceX now derives a majority of its revenue from Starlink, and that proportion is likely to grow even more. Additionally, as part of the process of going public earlier this year, in financial filings, SpaceX made clear that it envisions a vast majority of its future revenue will come from Starlink and orbital data centers. The category of “space enabled solutions,” of which NASA is a fraction, represented approximately 1 percent of what SpaceX views as its “total addressable market.” In other words, NASA needs SpaceX more than SpaceX needs NASA. Going forward, SpaceX wants to focus on launching its own payloads—on the Starship rocket.
NASA Administrator Jared Isaacman recognized this reality during a news conference on Monday, saying, “I do not think it’s a secret that SpaceX intends to sunset older platforms like Falcon and Dragon as they concentrate on their next-generation capability, Starship.” Q. What about Starship? A. Four astronauts currently launch on Dragon.
Starship could potentially bring dozens of astronauts into orbit at a time. That would be revolutionary for access to low-Earth orbit and an economy there. However, SpaceX has told NASA it is not interested in developing Starship for human launches into Earth orbit at this time. (Again, they’re focused on their own payloads). Ascent and entry of Starship, carrying humans, would raise a tangle of safety and regulatory concerns and is not a priority for the time being.
NASA has no real way to compel SpaceX, and any political capital the space agency might expend on Starship is going to be focused on getting a variant of the vehicle for a “Human Landing System” as part of the Artemis Moon program rather than human launches from Earth. Q. What’s happening with Boeing? A.
Boeing was NASA’s other partner in the Commercial Crew program. The agency has invested $5.1 billion to date in Boeing to develop the Starliner spacecraft. Despite this, Boeing has yet to fly a single operational mission to the space station. The news this week is that, despite these struggles, NASA will invest $359 million more to support the company’s efforts to fix Starliner’s propulsion system and certify the Vulcan rocket for new missions.
It is NASA’s hope that Starliner can supplement astronaut missions during the remainder of the International Space Station’s lifetime, and then be available for private space station operators. Q. Is this a good plan? A.
A lot of people don’t like it. Some critics say NASA has basically handed Boeing (not a particularly benevolent monopolist) and Starliner a monopoly on Western human spaceflight to low-Earth orbit for the next 10 or 20 years. This may effectively end any hope of a low-Earth orbit economy that involves humans in space. However, others say NASA faced few good choices.
And given NASA’s extraordinary investments in Boeing to date, it would have been fiscally irresponsible to abandon Starliner now. NASA funded two companies as part of the Commercial Crew program. If one of them is walking away, it makes sense to support the remaining one, even if there are legitimate concerns about Boeing’s past performance. Q.
What else might NASA have done? A. Some people wanted to see NASA fund a new competition, a Commercial Crew 2.0 for the 2030s. This would have brought on a competitor, probably Blue Origin but maybe also someone like Sierra Nevada or The Exploration Company, to keep price pressure on Boeing for crew transportation services.
However, a new competition would ultimately have cost NASA billions of dollars, and Isaacman seems reluctant to make such an investment given all of NASA’s other priorities. Isaacman believes Boeing can meet NASA’s needs, which are something like two seats every six to nine months, to orbit. The real unknown is whether a market beyond NASA—institutional customers from Europe, the Middle East, and beyond, in addition to privately funded astronauts—could exist at Starliner’s prices. Q.
How much does a seat cost? A. This is an important question. SpaceX’s original price per seat for early Dragon flights was approximately $55 million.
For more recent missions, the price has increased to $78.8 million. (And if SpaceX were to magically decide to keep flying Dragon longer, the price would only go up). By contrast, the Starliner price to NASA is $90 million per seat during the International Space Station era. So what happens after Dragon retires? Let’s just say no one expects prices to go down.
I asked Boeing Vice President John Mulholland about Starliner seat prices in the 2030s yesterday, and he replied, in part, “Obviously we want to be as competitive as possible.” But competitive with whom? Q. What about Blue Origin? A.
The space company founded by Jeff Bezos is developing a “Space Vehicle” for astronauts to launch on the New Glenn rocket. After some of my recent reporting, sources reached out to let me know that design work is “well advanced” along with demonstration work such as cabin pressure-vessel manufacturing, extensive parachute testing, in-house thermal protection system testing, life support systems, and more. I’ve heard “no earlier than” dates of 2031 for a cr
