Commercial Space Stations
and the declining need for vertical integration
At the start of 2022, the Biden administration stated that it plans to fund the International Space Station through the year 2030. This largely put an end to prior concerns that the station might be decommissioned and plummet into the Pacific Ocean as early as the middle of this decade due to funding limitations. That being said, a date is now set, beyond which the US and its international partners will no longer have access to this orbital destination that has been consistently inhabited since the year 2000.
So what's the plan after that? The US intends to hand off the process of managing a permanent orbital outpost over to commercial partners. Much like it has done with launching rockets, NASA would prefer to step back from the day-to-day responsibilities and costs of operating a space station in low Earth orbit. As a result, the stage has been set for commercial entities to vie for the opportunity to develop and manage their own commercial orbital space stations. These commercial entities will essentially own and operate orbital real estate, charging both government and commercial customers for access.
NASA has already begun to provide funding to those commercial partners. In early 2020 it awarded $140M to Axiom Space in the first contract for a commercial destination module to be added to the International Space Station. In December 2021 NASA awarded three additional organizations a total of $415.6M to develop commercial space destinations. That funding included $130M to Blue Origin, $160M to Nanoracks, and $125.6M to Northrop Grumman.
While these awards represent in themselves a burgeoning new commercial space market, I believe they are also critical for enabling the next generation of space-based enterprises. In this post, I will discuss in more detail these particular projects and what they aim to accomplish. In addition, I will address why I believe these commercial space stations will allow for a gradual trend away from vertical integration that I think is going to be helpful in facilitating a number of in-space services and products by reducing the capital hurdles to operating in space.
First lets start with the stations:
Axiom Space's commercial operations in space began as a broker and organizer of private tourist trips to the International Space Station. The first of these trips was the Ax-1 mission in which four private individuals flew on a SpaceX Crew Dragon capsule launched atop a Falcon 9 rocket and traveled to the ISS where they stayed for 17 days, conducting scientific research, outreach, and commercial activities. Axiom intends to build upon this experience by adding its own habitable module to the ISS where it will be able to house tourists and research experiments. In 2020 Axiom received a contract with NASA, worth up to $140M, to develop this first commercial destination module on the ISS.
Ultimately, Axiom aims to introduce its own fully independent, free-flying commercial space station in low Earth orbit called Axiom Station. To do so, they are working with partner Thales Alenia space who will provide the first two pressurized modules for the space station. First, Axiom is developing a module to add to the International Space Station and extend the ISS's current capacity. Later, Axiom will detach that module from the ISS before the space station is decommissioned and use the module to support the independent Axiom Station.
The Orbital Reef commercial space station is comprised of a partnership primarily between Blue Origin and Sierra Space. Other partners in the program include Boeing, Redwire Space, Genesis Engineering, and Arizona State University. It is intended as a mixed-use business park where customers can lease space aboard the station to conduct research or industrial manufacturing. Furthermore, more sophisticated customers with their own infrastructure can dock entire modules to the Orbital Reef station.
The group plans to leverage components of each contributing partner. These include the New Glenn rocket from Blue Origin for launch access, the Dream Chaser spaceplane from Sierra Space for crew and cargo transportation, the Boeing Starliner for crew spacecraft, and deployable structures and payload operations from Redwire Space for microgravity research capabilities.
In 2020, Nanoracks launched the Bishop Airlock and docked it with the International Space Station. That marked the first commercially funded airlocked module to be placed in space. Nanoracks aims to ultimately develop their own private space stations that are completely independent form the ISS. The first of those is Starlab. The core of Starlab will be a research module called the George Washington Carver Science Park.
Nanorack's most significant partner on Starlab is Lockheed Martin, who will serve as the primary manufacturer and technical integrator on the project. The key elements of Starlab include the inflatable habitat, a metallic docking node, a power and propulsion element, a robotic arm for servicing cargo and payloads, and a state-of-the-art laboratory system. Starlab plans to be a continuously crewed commercial platform and will be able to host up to four astronauts conducting research at a time.
Nanoracks is a subsidiary of public company Voyager Space Holdings.
Northrop plans to leverage a number of existing technical capabilities as part of its free-flying space station program. These include its Cygnus spacecraft which is currently used to provide supplies to the ISS as well as the Mission Extension Vehicle (MEV) which is designed to offer a number of in-space services to other orbiting spacecraft. Northop will also build upon its experience building the moon orbiting Habitation and Logistics Outpost (HALO) module for NASA as part of the existing Lunar Gateway program.
Northrop has been less explicit about its partners in the development of its LEO space station. They have announced plans to build a team with "unique capabilities and expertise" which will include Dynetics as well as "other partners to be announced in the coming months".
Next, I'll discuss how these stations may impact the historical necessity for vertically integrating in space. But before we continue, learn how you can get free space swag by referring others to sign up for SpaceDotBiz:
A Path Away from Vertical Integration
In my opinion, these stations are increasingly critical to the space industry entering its next phase of economic development.
As we look to the future of the in-space economy, there are a number of highly ambitious operations and business cases emerging. These include applications like as in-space manufacturing, asteroid mining, spacecraft assembly, private tourism, propellent extraction, and others. A major challenge of these ventures is that the organizations seeking to accomplish those services must vertically integrate solutions for nearly every technical challenge along the way.
What that means practically for example is that a company looking to manufacture valuable products in space must build an entirely contained spacecraft that can independently manufacture materials on orbit and then bring them back to Earth. As a result, the organization cannot solely focus on their manufacturing technology, but instead must also develop the power systems to support the manufacturing, create highly reliable robotics automation, and invent reentry capsules for bringing the end-products back safely to the planet's surface.
In a future with commercial space stations, there is theoretically much less need to vertically integrate all these solutions. Instead, one can imagine a manufacturing company can simply send up their technology to a commercial space station, plug the system into the power provided by the station, hire a technician living on the space station to repair any failures in the manufacturing technology, and have the end products ship back from orbit aboard a reentry flight that is already scheduled. This allows the manufacturing company to concentrate much more intricately on its core technology.
I'm not suggesting that this route of operating on a commercial space station is necessarily the best path for any in-space manufacturing company. There are reasons why they may wish to build a technical moat around other parts of the process and still choose to vertically integrate. However, having this optionality of leveraging other technology would introduce new paths to starting businesses in space.
As a result, I believe the biggest result of the partnerships that will ensue from these orbital habitats is that they will greatly reduce the capital intensity of starting a business that conducts operations in space. These orbital platforms will likely bridge the gap to a number of applications that at the moment cost hundreds of millions of dollars to reach any sort of operational scale.
While any individual reduction in capital barriers to entry is unlikely to completely open the floodgates to innovation in space, every incremental cost reduction helps when they are all aggregated. The ability to leverage orbital platforms, combined with the gradual reductions in launch costs and satellite components, only moves the needle closer to the ethereal concept often referred to as "the democratization of space".