Space - The last business frontier?

Whenever I hear about SpaceX, Blue Origin, or any other player in the space industry, I think only about space tourism and space exploration. You know the usual going to the moon or seeing the Earth from space stuff 😊. But unfortunately, this is not the case. Not even close. The space industry is much bigger than just space tourism.

So in this article, I will talk a bit about the space industry and then move on to see how our country is doing in it.

Space Race is On

Many years ago, if you are an engineer who wanted to venture into space, you didn’t have many options. All you had were the government space agencies. But now, with the emergence of ‘New Space,’ you can pursue a career in the space industry.

What is this, New Space? Let me quote Wikipedia for you

The term ‘NewSpace’ emphasizes the relative modernity of private spaceflight efforts, encompassing international and multinational efforts to privatize spaceflight as a commercial industry. “

Simply put, ‘OldSpace’ refers to the space activities that are controlled by national agencies only, and ‘NewSpace’ is one in which it is not an exclusively state-owned playground anymore.

The Space race started on October 4th, 1957, when the Soviet Union launched Sputnik 1 – the world’s first artificial satellite - into space. This triggered a space race between the Soviet Union and the USA, and there was no stopping after that.

With the USA and Russia investing in space, other countries did not want to stay behind. As of 2018, there were 72 different government space agencies. Out of those, six of the government agencies had full launch capabilities, and I am proud to say that ISRO is one of them. The governments are leaving no stones unturned, and they are continuously launching orbital satellites. The following illustration will give you an idea about the number of orbital launches in 2019.

Today the global space industry is worth about $350 billion, and by 2040, it is expected to be a trillion-dollar industry. You can imagine the vast scope of opportunities that are available in the space industry.

The graph below will give you an idea of how the space industry is expected to grow in the near future.

Source of data: Morgan Stanley

Other than these opportunities, we might have a lot more opportunities to do business in space. Private space travel may be commercially feasible in the near future. We could start mining to extract minerals from asteroids and so on. The possibilities are endless, just like space.

Space is not the same for all

Although a lot of NewSpace companies are emerging, they don’t look at the same way at space. They have different regimes in which they operate.

Suborbital – Spacecraft reaches 100 km or higher in space but not high enough to reach the Earth’s orbit. Companies like Virgin Galactic have already started to sell tickets for sub-orbital travel in the future. The ticket costs are around $250k, and during the journey, passengers will get to see the curvature of Earth against the blackness of space and experience a few minutes of weightless before coming back down for a runway landing. Suborbital flights can happen soon in the coming years.

Orbital – Companies like SpaceX are the ones that target their primary business in the orbital regime. Satellites revolve around the orbit. SpaceX has been sending materials and satellites into orbit for paying customers for a while now.

Deep Space – This one is my favorite. The companies here look towards the Moon, Asteroids, Mars, and beyond. You already know Elon Musk and his fascination with Mars. SpaceX is one of the companies that is looking to delve into deep space. Another example could be Planetary Recources, Inc whose goal is to "expand Earth's natural resource base" by developing and deploying the technologies for asteroid mining.

NewSpace Companies

India in Space

Indian Space Research Organization ( ISRO ) has come a long way since its establishment in 1969. With over five decades of experience, India is investing in enhancing its capability and expertise in space services. Indian space economy is currently at about 7 billion USD, which is about 2% of the global space economy. The budget that the Indian government is allocating towards space is also increasing year on year.

India has realized that the space sector has a lot more to contribute to India’s GDP. Recently, Nirmala Sitharaman announced that private firms would be allowed to use assets of ISRO and future projects for planetary exploration, and outer space will be open for the private sector. She said :

India already has the benefit of an extraordinary institution like ISRO, but now lots of private players are also coming in with innovative space technology. We will allow private players to benefit from ISRO's assets and give them a level-playing field to boost India's space sector further.”

This does not mean that the private sector did not have any role to play before. The private industry’s contribution to the space sector was mostly through subcontracting mode. The critical value addition activities had been carried out by ISRO in-house. But now, with this new announcement, the entire space ecosystem in India can change. Even the ISRO chairman Dr. K Sivan feels the need for private players to boost the Indian space sector. He said :

Under the present situation, ISRO has reached its limit on providing our services due to manpower limitations, and we can’t scale up more than 3 percent market share. That’s why we need private players to get involved, and that will also boost market share when they diversify into many services.”

Recently, the union cabinet approved the formation of IN-SPACe (Indian National Space Promotion and Authorization Centre), which would ensure a level playing field for private space companies to use the Indian space infrastructure. ISRO will continue to be the primary decision making authority towards space missions and projects.

Entering of private parties opens up the possibility of building more satellites and more launches. Currently, ISRO carries out around 2-3 major satellite launches a year. The Pillai Committee recommended the private sector to help ISRO to take the number of annual launches to 15.

Exciting time ahead for India and the whole world in the space industry. Who knows, soon, we might be taking trips to the moon as our yearly holiday plans.