Internet Pioneers' Next Frontier
For the Internet's innovators, it seems, there's no path like the one from cyberspace to space.
In announcing the Google Lunar X Prize on Sept. 13, Google (GOOG) co-founders Larry Page and Sergey Brin joined a growing brigade of tech luminaries who have put their Web wealth to work in an area where they've little expertise: trying to transform space travel from a largely government affair to a civilian, profitable business.
Like the $10 million Ansari X Prize, the Google Lunar X Prize provides incentive for the emerging private space industry to come up with innovative ways to build space exploration technologies (BusinessWeek.com, 9/19/07) cheaper and faster than ever before.
The $20 million grand prize will be awarded to the team that can land a privately funded spacecraft on the moon, rove on the lunar surface for a minimum of 500 meters, and send a specific set of video images and data back to earth by Dec. 31, 2012. "We believe that these kinds of contests, in setting an ambitious goal like going to the moon, are a really good way to improve the state of humanity and the world and that's why we care about this," Page, who has served on the board of the X Prize Foundation since 2005, said at the contest launch.
A Star-Studded Roster
Even without Page and Brin, the roster of tech visionaries who, as an encore to revolutionizing the Internet, have set their sights on space, is star-studded.
Vint Cerf, one of the founding fathers of the Internet, began working a decade ago on protocols for deep space communications, known as the Interplanetary Internet. Jeff Bezos, the founder and CEO of Amazon.com (AMZN), has started Blue Origin, which is working to develop a vehicle to transport a small number of astronauts into suborbital space.
Elon Musk, former CEO of PayPal (EBAY) and Zip2, has invested more than $100 million of his own money to start Space Exploration Technologies, or SpaceX, a company that's building a family of launch vehicles. Jim Benson, who founded CompuSearch and invented modern full-text computer indexing and search, is creating a vehicle for space tourism at Benson Space that seeks to minimize the violent impact that spacecraft encounter on re-entry into the earth's atmosphere.
Satellites Dominate the Business
Cerf doesn't think it's a coincidence that people who were involved in key Internet developments might turn to space for a new challenge. "A lot of what goes on in the Internet is to try stuff that has never been done before and there's this intriguing challenge—'I wonder if I can make that work,' or 'Boy, that's a hard problem. How are we going to deal with that?' I think there is something attractive about that," says Cerf, who is now vice-president and chief Internet evangelist at Google.
The space industry is already sizable, though it consists mostly of the business of launching and operating communications satellites. Combined commercial and government spending in the sector totaled about $180 billion in 2005, the last year for which numbers have been compiled, according to a report issued by the Space Foundation, a nonprofit space advocacy group. Surprisingly, U.S. and foreign government space budgets account for just 39% of the market. The remainder consists of commercial activity such as satellite manufacturing, launch, and services such as satellite TV, radio, and data communications.
Companies such as Bezos' Blue Origin and Richard Branson's Virgin Galactic are targeting the potential market for space tourism and commercial transport. Both companies plan to start with suborbital flights that would likely last a few hours and peak at 300,000 to 400,000 feet above the earth, a height at which passengers can experience weightlessness.
Space Tourism Off to a "Good Start"
While Virgin Galactic is already taking reservations and deposits for $200,000 flights it hopes will start in 2009, and the Russian Space Agency has flown some civilians, tourism still amounted to less than 1% of the total space market in 2005. Still, the Space Foundation estimates that space tourism could produce $600 million to $700 million in revenue per year by 2014. "In the landscape of a $200 billion industry, it's not much. But it's a good start," says Elliott Pulham, CEO of the Space Foundation.
While Bezos is extremely secretive about Blue Origin, his Web site shows that he's developing a reusable launch vehicle called New Shepard that looks like a modernized version of the Apollo Command Module. New Shepard is a vertical takeoff and landing craft designed to ferry a small number of people on a suborbital journey. The idea is to dramatically reduce the cost of going into space so that more people can travel there.
In November, 2006, Blue Origin launched and landed Goddard, an early unmanned prototype of New Shepard. In filings with the Federal Aviation Administration, Blue Origin has said it will continue testing vehicles through 2009 and commercial operations might begin by 2010. According to the filings, Blue Origin anticipates enough demand for up to 52 launches per year.
From Payments to Satellite Launch
Musk, the former PayPal CEO, says his company, SpaceX, is going after the commercial launch market, engineering rockets that can take satellites and astronauts into space at prices 40% or more below what existing players charge. Musk hopes to capture a large chunk of what he estimates to be an addressable market of about $4 billion per year in launching satellites for businesses and the U.S. government. Because it plans to retire the Space Shuttle in 2010, NASA has awarded SpaceX and Rocketplane Kistler of Oklahoma a $500 million contract to develop alternative ways to carry supplies and possibly crew to the International Space Station.
Musk has conducted two test launches of his company's Falcon 1 from the Pacific island of Kwajalein, 2,400 miles southwest of Hawaii. The last test flight, on Mar. 20, reached an altitude of about 180 miles before a problem prevented it from reaching full orbital velocity. Musk says his customers are not perturbed by the fact that his rockets have yet to reach their destination. "We haven't lost a single launch contract," he says of the 12 launches SpaceX has scheduled between now and 2010 with NASA, the U.S. Air Force, the Defense Dept., and other clients worldwide. In fact, business has been so good that SpaceX has been cash-flow positive since the fourth quarter of 2006, and the company is on track to turn profitable in 2007.
Despite his confidence, Musk concedes there are certainly easier and less expensive markets for an entrepreneur to crack. "Even if you [have] spent billions of dollars and done everything you possibly can and recruited every top person in the world, there's still a chance of something going wrong. It's a very difficult business," says Musk. Both Musk and Bezos seem to realize that passion is the only antidote to this treacherous path. In fact, Blue Origin makes this clear to job candidates on its Web site, "You must have a genuine passion for space. Without passion, you will find what we're trying to do too difficult. There are much easier jobs."
Making Star Trek a Reality
For some, that passion stems from a fundamental belief that human life should exist beyond Earth. "Maybe I've been watching too many Star Trek reruns, but I've always believed that in the long run we are not and should not be a one-planet species," says Cerf.
Musk says the idea of bringing human civilization to multiple planets is a driving inspiration for both him and Bezos. "Jeff's motivation is really the same as mine, which is that one of the things we must do is to extend life beyond earth," says Musk. Back in college, Musk says, he began thinking about what would have the biggest impact on the future of humanity. The most intriguing challenges were "the Internet, transitioning to a sustainable energy economy, and the third was space exploration and the extension of life beyond earth," he says.
Bezos' interest in space dates back to his elementary school years, when he spent a great deal of time watching and playing Star Trek with friends, according to an interview he gave to the Academy of Achievement, a nonprofit organization that gives awards to leaders in the arts, business, public service, science, and sports. His favorite roles to play were Spock, Captain Kirk, and the ship's computer, in that order. In his speech as valedictorian at Miami Palmetto Senior High School in 1982, Bezos talked about the importance of colonizing space (BusinessWeek, 11/13/06). Later, at Princeton, he was president of Students for the Exploration & Development of Space, an organization that was originally founded in 1980 by Peter Diamandis, the CEO and chairman of the X Prize Foundation.
All in the Family
By contrast, both Brin and Cerf found early influences at home. Brin's mother is a scientist at NASA's Goddard Space Flight Center, where she works on simulations related to atmospheric and weather conditions affecting space travel, according to The Google Story, a book by David Vise and Mark Malseed. And in an article for Moment magazine, Malseed wrote that Brin's father was forced to abandon his dream of becoming an astronomer in Soviet Russia because of anti-Semitism that essentially barred Jews from the physics program at Moscow State University. Brin and his family immigrated to the U.S. in 1979 when he was 6.
Cerf's father worked at North American Aviation, a company that over the years created the X-15 rocket plane, the Apollo Command & Service Module, the Saturn V rocket, and the Space Shuttle orbiter. During a couple of summers in the early 1960s while Cerf was in high school and college, he worked at Rocketdyne, which was later acquired by Boeing (BA). "I have a T-shirt that says, 'I'm a rocket scientist,'" says Cerf. These days, it looks like quite a few more Internet innovators can wear that same T-shirt.