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Posts Tagged ‘space launch business’

The Falcon Heavy Launcher is a Publicity Stunt, Not a Paradigm Shift

February 10, 2018 10 comments

Long-time readers of my blog might know that I am not a fan of Elon Musk and his frequent attempts to grab public money and attention by making outrageous promises. Some of you might remember that, a few months ago, I wrote a fairly critical piece on SpaceX. In it, I argued that the central ‘big promise’ of SpaceX- namely, that it can “disrupt” and completely upend the existing space launch business is a quintessentially american scam. You might also remember, in the same post, I also said that SpaceX as could make a decent profit if it was run like another normal business.

Implicit in the last statement was my educated guess that Elon Musk’s need for fame, money and ego would kickstart a series of decisions leading to the eventual ruin of the current boring but modestly profitable business of launching things (and perhaps) people into earth orbit. Till last week, my other guess about SpaceX demonstrating the ability to become a conventional and somewhat successful (but boring) company was on track. Now, it seems my guess about Elon Musk’s megalomaniac ambitions initiating a series of bad decisions is also coming true.

Some of you might think I am just hating on that guy because of the recent launch of their signature Falcon launcher in its ‘Heavy’ configuration. Readers might find it interesting that, in private twitter conversations, I gave it a better than 80% chance of success on its first try- which is a bit higher than SpaceX was willing to publicly admit. And why not? Falcon Heavy is an evolutionary development of a pretty well-tested launcher design, and while putting three multi-core stages next to each other can produce some peculiar mechanical issues, they have been successfully solved by others in the past.

And this brings me to my first criticism of Falcon Heavy and other recent attempts at building Super heavy-lift launch vehicles. As you can see in the graphic (below), lauchers which can put over 50 tons into Low-Earth Orbit (LEO) have been developed since the 1960s. A number of such launch systems– from Saturn V, Space Shuttle Launch System and Energia— have flown on more than one occasion and have been quite successful at fulfilling the mission they were designed to perform. Yet, they all went out of production after the specific mission they were designed to accomplish was terminated. In other words, Super heavy-lift launch vehicles have (to date) been one-trick horses. But why?

Why have smaller space launcher families such as Soyuz, Proton, Titan, Delta 2, Long March 2 and Ariane 4 remained in service for decades, while much larger ones like Saturn V and Energia went out of production within a few years of their first flight? Some of you might think that it has something to do with technological complexity of larger systems, but larger launchers are not that much more demanding to operate that heavy to medium launchers such as those mentioned in the previous sentence. A better explanation for the longevity of heavy to medium launcher families comes down to the weight of payloads most frequently launched- unmanned artificial satellites, spacecraft carrying humans in LEO orbit and unmanned space-probes.

To make a long story short, the absolute majority of space launches do not need to put payloads above 30 tons in LEO, perhaps 10-12 tons in GTO and even less for Heliocentric or Hohmman transfer-type orbits. More relevantly, this apparent restriction on payload capacity has little to do with the cost or ability to launch them. Instead, it is largely a consequence of progressive miniaturization of electronic components used in unmanned spacecraft combined with the highly onerous weight requirements for manned exploration of anything beyond the moon using chemically powered rocket engines. Physical and chemical reality, you see, cannot be bargained with or ignored.

But it gets worse.. the bulk of commercial launch market that SpaceX wants to “disrupt” could care less about launchers more powerful than their current default Falcon 9 Full Thrust. Launchers of comparable capacity with a significantly longer service life, such as Ariane 5, have been launching two communication satellites on one launcher for many years. In other words, customers interested in putting large and heavy communication satellites seem to be in no hurry to develop ones that weigh over 6 tons. In fact, most operational communication satellites in GTO orbit are between 2.5-4.5 tons. Even the few super-secret government communication satellites for GTO orbit struggle to push past 10 tons.

Then there is the issue of lower than expected future demands for communication satellites because of the spread of global trans-oceanic fibre optic networks combined with relatively poor maximum data transfer rates at radio wave (lower) frequencies. Data intensive internet use by billions of people is better handled by massive terrestrial fiber-optic backbones than space-based radio frequency links. To be clear, I am not suggesting that the need for communication satellites is going to disappear in the near future. I am just saying that the initial explosive growth of communication satellites occurred due to proliferation of Cable TV channels and long-distance telephony in the 1980s to early 2000s period.

Let us now tackle the issue of manned exploration of celestial bodies beyond the moon. Ever wonder why NASA never did a man on mars after the conclusion of the Apollo lunar missions?

The simplest answer is that even their most optimistic designs for such a mission were (all modules combined) over 300 tons. In other words, even the most minimalist manned return mission to mars would require one or more rocket launchers to put 300 tons in low earth orbit. Then is the issue of the mission being about two years long with all its attendant physical and psychological risks. Short of developing a nuclear powered spacecraft which could cut the trip time to a few months, or even weeks, human space travel to any large celestial body more distant than the moon is really hard with chemical rockets.

And that brings to the unpleasant question about Falcon Heavy- Is it a ‘solution’ in search of a problem? Face it, there is currently no necessity or desire to develop orbital or space payloads of the size or weight where using Falcon Heavy to launch them would be competitive. Furthermore, decades of spending by governments and corporations has not created the need for payloads which could be only launched by super heavy lift launch vehicles. While its is easy to see a market for the services of Falcon 9 Full Thrust, the same cannot be said for Falcon Heavy. But if no customer is willing to spend money on utilizing its services, what is the incentive to keep on building and improving them.

In summary, I see the Falcon Heavy launcher as a publicity stunt rather than a ‘paradigm shift’ of any type in the space launcher business.

What do you think? Comments?

The Business Model of SpaceX is a Quintessentially American Fraud

June 6, 2017 25 comments

I have been meaning to write this particular post for a few months now, but was not sure how to compress into something that can be comfortably read in one sitting. On the other hand, aiming for too much optimization and perfection is probably not helpful for getting things done and posted. So here it is..

The main point of this post, stripped down to its absolute minimum, is that the business model of SpaceX is a uniquely american-style fraud. Note, I am not saying that corporations like SpaceX are incapable of making a profit someday in the future. My issues with their business model concern the many claims made by them about their future prospects, especially about their advertised potential for future growth, profit and services.

To be fair, the business model of SpaceX is Elon Musk‘s second largest fraud- after Tesla Inc. FYI- My criticism of the business model of Tesla Inc is not based on whether electric cars are practical or viable (they are both). It has to do with the claims made by Musk about how electric cars will displace internal combustion because the former will become somehow cheaper or more functional than the later. But that issue is best left for another day.

It is an open secret that Tesla Inc market capitalization has no link to the number of cars it can sell. How else can you explain a corporation selling less than 80 thousand automobiles a year being considered more valuable than one that sells 10 million a year. As you will soon see, the public image of SpaceX’s future potential is also largely based on a combination of extremely wishful (ok.. highly delusional) thinking and silly valley-style optimism. Along the way you will also see why I say that it is a quintessentially american fraud.

So let me list the many ways that SpaceX’s business model is based on a public relations-led fraud.

1] Everything SpaceX has achieved to date is based on half-century old research funded by the american government. Yes, you heard that right! SpaceX’s launchers are based on technology and fundamental research done by the public sector decades ago. Furthermore, unlike the older corporations comprising United Launch Alliance (Boeing, Lockheed etc), it has not really invented or discovered anything more innovative than making the lower stages of their rockets land vertically and streaming HD videos from them.

SpaceX’s business model is based on PR promoting themselves as innovative while being dependent on decades old research as well as direct and indirect government largess. It certainly helps that there are enough idiots in the world who will buys flashy hype. In other words, the business model of SpaceX is very similar to Tesla Motors and pretty much every single corporation (startup or otherwise) in Silly Valley. As I will show you in the next couple of paragraphs, their claim of being the cheapest space launch system is based on a gross misrepresentation- on many levels.

2] Elon Musk’s is trying to sell the dream that it is possible to build a few dozen launchers and then simply refuel and fly them over and over again for say 10-20 times before building new ones. To put it another way, he wants you to believe that it is possible to make space launch systems that are more like commercial airliners than conventional space launch systems. There is just one problem with that idea.. it is based on what can be best described as optimistic bullshit.

Rocket engines, you see, are rather different from most other types of engines in that they work under conditions of extreme heat and pressure and with a very tiny margin of mechanical safety. They have to so because of the conditions necessary for their operations and the need to keep their weight down. While it has been possible to build potentially reusable Kerosene-LOX engines of the type used by SpaceX for decades now, there haven’t been any takers. Even the ex-USSR, and Russia, preferred to use new engines rather than reuse engines even when they knew that the later would OK after refurbishment and testing.

But why? Why did countries like the ex-USSR which made them in tens of thousands prefer to use new engines than use ones they knew could be reused. Well.. it comes down to a cost and risk calculation. Rocket engines, even the most simplified and robust ones, are always one tiny defect away from blowing up. It is easier to be certain about the lack of tiny but fatal defects in a newly built engine than a refurbished one. Moreover the cost of a refurbished engine blowing up once in a while exceeds the cost of using freshly built engines. Also refurbishing and testing used engines can get almost as expensive as building new ones from scratch.

3] The launch cost of a spacecraft, especially a satellite or space probe, is often the smallest part of the program budget. Yes.. you heard that right, launch cost for satellites is often significant lower than the costs of designing, building and testing them- not to mention ground support for the next 10-15 years. My point is that launch costs for a satellite or any spacecraft (which is not a disposable transport vessel) is usually less than 20% of the “Total Cost of Ownership” for that particular spacecraft program. In other words, launch cost is not a particularly big concern to organisations whose primary operations require reliable and long-lived spacecraft. And this brings us the next point..

4] Even if we assume that SpaceX is actually cost competitive, who will use their launch services? Here is a hint- almost nobody outside the USA or in their political orbit. Here is why.. Countries such as Russia, China, India and Japan are going to use their own launch systems for a number of reasons from ensuring national security, keeping their own scientists and engineers employed and national pride. Also, vertical integration of spacecraft and launcher programs create far more cost savings than using somebody else to launch your spacecraft using slightly cheaper launchers.Even many European countries are unlikely to use SpaceX over their own ESA launch systems over the long term- even doing so is a bit more expensive because it is about preserving technology and job security for their own citizens. Furthermore, countries other than those listed above are also unlikely to have a strong preference for SpaceX since countries like China already offer very competitive packages covering everything from satellite design and launch to post-launch support aka vertical integration.

5] Even in USA, the launch business for commercial and military satellites is an oligopoly- one long dominated by well-known players such as Boeing, Lockheed-Martin and Thiokol. Did I mention that those corporations have much more money, and many paid lobbyists, than SpaceX? To make a long story short, Space X is unlikely to become the dominant player in the area of launching american spacecraft (in dollar terms) unless the other larger players screw up very badly. This is not to say that SpaceX cannot make a decent profit on launching some spacecraft for the american governments and USA-based corporations. In fact, SpaceX will run just fine and make a decent profit as long as it is run as a conventional launch business.

To summarize, SpaceX is bluffing and lying when it claims the ability to “disrupt” the space launch business or become the dominant global player in that sector. What is especially sad to see is the number of otherwise intelligent people who are willing to treat the press releases of that company as holy gospel. Then again the USA is full of self-delusional types who are confident of becoming multi-millionaires within the next decade. To summarize, the long-term (and even medium-term) business model of SpaceX is a confidence scam based on rosy and polished presentations combined with exhortations to positive thinking. And that is why I called it a quintessentially american fraud.

What do you think? Comments?