Minimizing the Risk of Business

By Larry Dignan  |  Posted 2005-08-31 Print this article Print

The UPS Brown Voyager? It could happen if private companies take over low-earth space travel and free up NASA to shoot for the stars.

But tourism can only go so far, Meyers says. Space Island Group plans to use the insides of the current shuttle's external fuel tanks as facilities that will be leased for research, tourism, and even sponsored launches and sporting events. Using solar space sails developed by NASA, the company hopes to build power stations that would beam energy to Earth via a weak microwave signal. Meyers is pitching officials in China, India and California on space power to fund his shuttle development.

The building block for all of those business cases, however, is cheap launches, Edwards says. Forecast International estimates that a rocket launch can cost from $25 million to $150 million, depending on payload.

What could make a better business case? Less expensive rockets. Space Exploration Technologies, based in El Segundo, Calif., is developing a rocket that would launch for $6 million. "If that works, it would open space up quite a bit," Edwards says.

Challenge:Risk management

Solution:Communicate the risks of space exploration and embrace them.

Perhaps the most daunting challenge facing NASA and commercial providers is the basic risk of flying into space. Will travel outside the atmosphere ever be completely safe? Should it be? How many deaths can be allowed?

With little margin for error, techies in a space operation have to unfailingly put the right information and analysis in from of the people who can act on it. Changing the Fate of Those in Space

Elon Musk, CEO of Space Exploration, says the risks need to be communicated clearly, and the public then will know enough to accept or reject space travel.

"NASA overstated the safety [aspect], and now space travel is held up to an unreasonable standard," Musk says. "Space travel is dangerous and as long as we accept that risk, we shouldn't be overly concerned about it."

Meyers notes that handing off low-orbit space to the private sector would allow more risk-taking—and possibly more technology breakthroughs. As for selling risk, Meyers looks to NASCAR for inspiration: "With NASCAR, you know it's dangerous and you know something can go wrong. And a lot of people are attracted to that."

Business Editor
Larry formerly served as the East Coast news editor and Finance Editor at CNET News.com. Prior to that, he was editor of Ziff Davis Inter@ctive Investor, which was, according to Barron's, a Top-10 financial site in the late 1990s. Larry has covered the technology and financial services industry since 1995, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine. He's a graduate of the Columbia School of Journalism.

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