The Outer Space business: the impact of private actors on space governance

  Focus - Allegati
  30 settembre 2023
  15 minuti, 52 secondi

by;

Giulia Consonni , Junior Researcher Mondo Internazionale G.E.O. Cultura & Società

Marco Rizzi, Senior Researcher Mondo Internazionale G.E.O. Cultura & Società

Francisco Duran Herrera , Head Researcher Mondo Internazionale G.E.O. Cultura & Società

Abstract:

Over five decades, space exploration has transformed from a Cold War rivalry into a daily life essential. Leading nations own satellites, while entrepreneurs like Musk, Bezos, and Branson invest heavily in space ventures. However, private involvement brings challenges like space debris and gaps in space law. This paper explores space's historical context, key players, and economic impact. It also delves into private ventures' rise, their competitive dynamics, and consequences for space law. The paper concludes by stressing the need for revising and adapting international space law to ensure responsible space exploration in the modern era.

Introduction:

Over the past half-century, space exploration has evolved significantly, with both governments and private entities playing pivotal roles. Initially driven by the Cold War competition between the United States and the Soviet Union, space activities have now become integral to daily life, from weather forecasting to global communication. Notably, a select group of nations, including the United States, China, Russia, India, Japan, and France, leads in satellite ownership and launch capabilities.

Space exploration has also seen a resurgence of interest, thanks to entrepreneurs like Elon Musk, Jeff Bezos, and Richard Branson, who have invested in space ventures. Private companies, such as SpaceX and Virgin Galactic, have received substantial investments.

However, the growing role of private actors in space activities presents challenges, including the proliferation of space debris and legal gaps in regulating private entities' actions. This necessitates a reevaluation of international space law to accommodate the changing landscape of space exploration.

I. Relevance of the outer space and main actors

More than five decades ago, the United States and the Soviet Union were embroiled in a protracted Cold War, extending their competition to the realm of outer space as a means to assert scientific predominance. Ultimately, this conflict culminated in the U.S. achievement of a lunar landing, subsequently paving the way for a period of amicable cooperation between the two nations.

Presently, a global majority of nations have incorporated outer space resources, predominantly satellites, into their infrastructures for purposes encompassing meteorological forecasting, navigational systems, telecommunications, and resource management. However, a select subset of nations possess satellite ownership, and an even smaller amount maintains the capacity for satellite launch capabilities. The foremost international space programs are attributed to the United States, China, Russia, India, Japan, and France. (Delgado, 2018)

Between the years 2013 and 2018, there was a notable reduction in actualized expenditure pertaining to space-related endeavors, ascribed to cut back initiatives and fiscal constraints within both the United States and Russia. Concurrently, a visible escalation was observed in the deployment of civil and governmental agencies' satellite launches. Notably, 2018 witnessed an excess of an 80% surge in satellite deployments, concomitant with a significant augmentation in the number of entities possessing launch capabilities. The preponderance of launches emanated from China, followed by the United States at approximately half that amount, and subsequently Russia at a lower level. (Delgado, 2018)

Spaceborne services have become indispensable facets of quotidian life. The utilization of these services persists in its proliferation, as an expanding array of nations and corporate entities endeavor to commission and oversee satellite systems. Projections indicate a prospective launch of over 50,000 small satellites by the year 2030, representing a noteworthy ascent. The reliance upon and utilization of spaceborne assets by society at large will only intensify and broaden as satellite operators innovate and offer novel products and services. (Delgado, 2018)

Different parts of the economy rely on space-based services to different extents. The military and emergency management agencies, for example, depend entirely on satellite technology for certain services. While most industries have backup systems, if there were widespread problems with space-based services, it could cause significant issues because these services play a fundamental role in supporting a large part of our critical infrastructure. (Jankowitsch, 2015)

Four prevailing categories of space-based capabilities find ubiquitous application, including: the Global Positioning System (GPS) or akin positioning, navigation, and timing satellites; remote-sensing satellites, which gather data from energy emissions or reflections emanating from Earth; weather satellites; and communications satellites. These four domains of satellite capabilities hold salience for both industrial and governmental pursuits, encompassing the sectors delineated hereafter. From agriculture to national security, environmental surveillance to financial operations, commercial fishing to emergency services, space-based services—though intangible—facilitate or augment a diverse array of everyday applications, the profundity of which may often go unacknowledged. (Jankowitsch, 2015).

Contemporaneously, space exploration stands as a subject of paramount interest globally. Nearly every day heralds news of recent space missions and milestones, spanning both national and international domains. Enterprising magnates such as Elon Musk, Jeff Bezos, and Richard Branson are impassioned advocates for outer space endeavors, having substantially contributed to this renaissance through the financial patronage of their respective enterprises and activities in outer space. Private investment, technological advancement, and flourishing public intrigue have revived our collective fascination with outer space. A multitude of nations are actively participating in space endeavors, with the primary aim of enhancing their rudimentary communication and navigational capacities to stay-up-to date with neighboring regions. Adversaries are at the vanguard of developing technologies that pose challenges to U.S. and allied space systems and services. The diminishing costs of space launch services have underpinned a high proliferation in the number of entities propelling objects into space, thereby enabling numerous nations to acquire sophisticated technologies, and strengthening their own domestic space industries. The increased commercialization and affordability of space technologies signify that satellites are no longer the exclusive competence of a select framework of space-adventurous powers. Presently, over fifty countries and multinational organizations lay claim to, or are actively engaged in the operation of, space-based assets. (Jonckheere, 2018).

II. Private actors: in between entrepreneurial visionaries and competitive dynamics

In the domain of space exploration, a notable resurgence of interest has materialized, coinciding with reduced costs and significant technological progress, reflecting a renewed commitment to this field. Key aerospace enterprises such as SpaceX, Blue Origin, and Virgin not only recognize the potential for substantial financial gains but also emphasize the scientific rewards inherent in such endeavors. These favorable signs have quickly aroused investor enthusiasm. For instance, Bryce Space and Technology (2022), a specialized aerospace consultancy, disclosed that U.S. venture capital firms invested over $8.2 billion in private space sector enterprises between 2015 and 2020. Significantly, 2015 marked a pivotal juncture, with investors allocating an impressive $1.8 billion, nearly double the cumulative investment of the preceding 15 years, as reported by Morgan Stanley (2022).

In the United States, the New Space paradigm distinguishes itself through substantial capital infusion coupled with visionary purpose and dedication. These ambitions have combined into concrete projects promising employment opportunities and sustained growth, spanning several decades. Private-sector entities have effectively shaped the sector's evolution, not only for their own benefit but for the broader industry (Moranta & Donati, 2022). Pioneering figures in this phenomenon include Elon Musk (founder of SpaceX), Jeff Bezos (founder of Blue Origin), Richard Branson (founder of Virgin Galactic and Virgin Orbit), and Gregory Wyler (formerly of O3b and OneWeb). Leveraging their substantial resources, they have fostered ambitious ventures aimed at expanding human activities beyond Earth's immediate confines. Some ventures also pursue terrestrial-focused initiatives, diversifying their business portfolios in the face of uncertain models and bolstering their public profiles (Foroohar, 2022).

Elon Musk exemplifies this phenomenon most clearly. His ambitions for Martian colonization date back to the establishment of SpaceX in 2002. Originating from South Africa, Musk's primary objective was to reduce the exorbitant costs associated with space transportation, ultimately facilitating the establishment of a human colony on Mars. One year prior to the inception of his company, Elon Musk conceived the idea of deploying a miniature experimental greenhouse on Mars as part of the "Mars Oasis" project, dedicated to cultivating plants in extraterrestrial conditions. Despite initial challenges, SpaceX, with broad public support, successfully operates the Falcon 9 and Heavy launch systems and is actively developing the Starship launcher, intended for human missions to Mars. Drawing from its extensive experience gained through collaborations with NASA under the COTS and CCP contracts, SpaceX strategically communicates around initiatives such as the Inspiration4 mission and partnerships with affluent "philanthropic" individuals. In addition to space exploration endeavors, Elon Musk has pursued "terrestrial" projects, notably in the field of connectivity, exemplified by the Starlink mega-constellation project, which currently maintains approximately 2,500 satellites in orbit, primarily aimed at bridging the global digital divide. The crafting of a dual narrative encompassing both space exploration and terrestrial betterment has played a pivotal role in SpaceX's growth, effectively resonating with investors and, crucially, its workforce. Despite an exacting corporate culture characterized by intense pressure, internal competition, and a relatively high turnover rate, SpaceX's overarching vision has instilled a profound level of commitment among its personnel (Vdovychenko, 2022; Williamson, 2016, Harris, 2018).

On a separate note, Gregory Wyler stands as yet another luminary entrepreneur who has played a pivotal role in shaping the American, and indeed the global, space arena. As the progenitor of O3b Networks and OneWeb, Wyler led the conceptualization and proliferation of colossal satellite constellations, thereby initiating a paradigm shift in contemporary telecommunications landscapes. It is noteworthy that the United States alone boasts no fewer than 100 private constellation projects, emblematic of the flourishing interest in this field, along with the underlying technologies, notably small satellites (smallsats). These two corporate entities were predicated on the overarching goal of bridging the digital chasm, with "O3b" shortly encapsulating this aspiration, denoting "Other 3 billion," a reference to the three billion individuals hitherto devoid of internet connectivity (Harris, 2018; Graydon & Parks, 2020).

The example of Richard Branson also offers valuable insights, as he stands among the pioneers of space tourism, particularly in the realm of low-Earth orbit space tourism. In 2004, he established Virgin Galactic, a company that promptly staked its claim in this specialized market niche. Despite encountering several setbacks, including the tragic crash of the VSS Enterprise in 2014, which resulted in the loss of life and the spacecraft, the company persevered in refining its vision over the subsequent 15 years, culminating in its inaugural passenger flight on July 11, 2021, notably with founder Richard Branson aboard the spacecraft (Seedhouse, 2015; Galactic, 2021).

It is imperative to recognize that the impetus propelling the American space sector extends beyond the visionary aspirations of its key players. A striking illustration of this dynamic rivalry can be observed in the competition between Virgin Galactic and Blue Origin, both fervently competing for supremacy in the realm of suborbital tourism. Virgin Galactic achieved a significant milestone by executing its inaugural 6-minute flight, ascending to an altitude of 85 kilometers on July 11, 2021, narrowly preceding its rival, Blue Origin. Blue Origin, led by founder Jeff Bezos, accomplished its inaugural manned flight on July 20, 2021 (Galactic, 2021). It is noteworthy, however, that Blue Origin attained the symbolic pinnacle of 100 kilometers in altitude, a threshold regarded by some as the demarcation of outer space—a distinction not achieved by Virgin Galactic. This competitive spirit serves as a foundational and structuring element within the New Space paradigm, a phenomenon that is similarly evident in other domains, such as lunar exploration, exemplified by the intense rivalry between SpaceX and Blue Origin for the coveted HLS contract.

III. The consequence of the growing importance of private actors in outer space

The rising importance of private actors in space has various repercussions.

As NASA reported, the space debris in Earth Orbit has critically increased in the last few years. The monthly number of total objects in Earth Orbit in 2020 was more than 19000. Types of space debris are for example fragmentation debris, mission-related debris, and rocket bodies (NASA, 2019). The growing population of space debris extends the potential danger to all space vehicles, including to the International Space Station as well as other spacecraft with humans aboard. Indeed, given the extremely high speeds of both debris and spacecraft, an impact can be highly problematic even when the dimension of the orbital debris colliding with a spacecraft is limited (Garcia, 2021). Orbital debris and potential collisions is, therefore, a crucial challenge that needs to be tackled to allow the sustainable development of space activities (Khlystov, 2023).

The growing importance of private actors has also other types of consequences, less visible but equally significant. The need for outer space law began in the late 1950s with the start of the “space race” between the US and the Soviet Union. Shortly after the 1957 launch of Sputnik, the first manmade satellite, in order to boost international cooperation on issues relating to activities in outer space, the United Nations conceived a legal framework to govern these activities through five international treaties. Given the fact that only states were active in outer space at the time when space law began to form, the emergence of space activity did not entail private actors and, consequently, international space law as a whole, is not furnished with adequate methods to enforce their provisions upon them (Isnardi, 2020). More generally, international space law is simply a branch of public international law that traditionally considers states as the primary - if not sole – actors (Dunoff, 2006).

If one has a look at the text of some of these conventions, the consequences of the difference between private and public actors and the difficulty of enforcement of international norms upon the first become clear. Let’s consider, for example, the Outer Space Treaty (OST), deemed the ‘constitution’ of international space law (Rosenfield, 1979).

In the OST, it is stated that ‘the exploration and use of outer space […] shall be carried out for the benefit and in the interests of all countries […] and shall be the province of all mankind’ (Article 1(1) OST). In addition, the exploration activities and use of outer space have to be carried out ‘in the interest of maintaining international peace and security and promoting international cooperation and understanding’ (Article 3 OST). Scientific investigation in outer space should ‘facilitate and encourage international cooperation’ (Article 1(3) OST), and the UN Secretary-General ‘as well as the public and the international scientific community’ has to be informed of the results of such activities (Article 11 OST).

In light of this wording enshrined in the first and most important international space law treaty applying to all its States Parties, the contrast with the activities and aims of private actors is outlined and some questions arise. If the final objective of enhancing international cooperation seems utopian when it comes to States, it is absurd to think that the main goal of private enterprises is to foster international peace or scientific cooperation among states. Private investments and involvement of private actors are increasing (Moranta & Donati, 2018), and are clearly driven by power, prestige, and economic profits that could derive from them. Rather than trying to create a better world, modern space exploration seems to be all about money, money, money (Mahdawi, 2022).

Since 1979, no treaties have been adopted and no changes to the existing treaties have been made. Private actors have various avenues to avoid the enforcement of international space law upon them. This problem is worsened by the current domination of the space economy by private players that will likely continue to increase their stronghold over outer space activities. Substantial changes to ensure proper enforcement are necessary to cope with this new era of space exploration (Isnardi, 2020).

Conclusions:

In this article, we have examined the evolution of space exploration over the past five decades, highlighting its transformation from a Cold War rivalry into an essential aspect of daily life. We have discussed the key players in space exploration, both on national and private level, emphasizing the significant contributions of entrepreneurs like Elon Musk, Jeff Bezos, and Richard Branson. The main takeaway of the analysis is the crucial role that space-based services play in various sectors of the economy, from national security to environmental surveillance, and financial operations. Furthermore, the consequences of the growing importance of private actors in space activities have been explored: one major challenge is the proliferation of space debris, which poses a significant threat to all space vehicles and necessitates immediate attention for the sustainable development of space activities. Another critical issue analyzed is the gap in international space law when it comes to regulating the actions of private entities. In fact, traditional space law is primarily focused on states as the primary actors, leaving private ventures with limited accountability. This gap needs to be addressed to ensure responsible development of outer space activities in the modern era.

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