Why I love the space game

Nasa pulling out of the low-earth orbit business has opened up opportunities for daring high tech rocket companies to fill the void, says Paul Hill.

Here's why the space industry is great - the stratosphere is the ultimate barrier to entry. Getting to space takes decades of engineering, billions of dollars and strong client relationships. The sector is out of bounds to all but a handful of the most advanced aerospace players. Private rocket builders have put in years of R&D and tough rocket science, and now they're reaping the rewards. They've won the trust of NASA and the US Department of Defense and have launched hundreds of satellites for private customers.

And they're going to be needed. The Obama administration has decided that the economics of space exploration is broken, not the science. Their plan: get out of the low earth orbit business by retiring the space shuttle programme, and rely on private industry to build the technology to ferry people and cargo into space.

That leaves NASA free to focus on the frontier, developing advanced technology for the most ambitious space flights. And it's an opportunity for daring high tech rocket companies to fill the space shuttle's shoes.

Fighting for a piece of a $289bn industry

It's already a massive industry. The Space Foundation estimates that the space economy grew by 12.2% last year, to $289bn. And that number is up 41% since 2007, driven mainly by commercial companies and a 22% jump in private space infrastructure last year.

Private space companies are looking to build safe, reliable rockets to transport people and cargo at a fraction of their previous cost. Companies such as Orbital Sciences are targeting a $20m cost per astronaut on their next generation of manned rockets - compared to the $50m paid currently to the Russian government for a trip with their Soyuz rockets.

So far the private rocketeers have won multi-billion dollar contracts from NASA to ferry cargo to space. And manned space flight is their next goal.

Private rockets are also profiting from a global satellite boom. The insatiable appetite for data is fuelling demand for new satellites so that now they crowd the sky. The satellite launch industry's revenues bear this out they grew by 10% last year. Satellite manufacturing revenues also grew by 9%. And the market for geostationary satellites which hang in a high stationary orbit above the equator - is set to grow by 10-20% this year.

Forecast international doesn't see things changing any time soon it values the commercial satellite market at $52.7bn in the next ten years. Such a tempting market has attracted all sorts of space industry players, from niche start-ups such as Virgin Galactic to Boeing, SpaceX and Orbital Sciences.

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