🚀 Faster, Please! — The Podcast #33

Over the past 15 years, the cost to launch a rocket into orbit has declined dramatically thanks to SpaceX. Today, we're witnessing the launch of a new Space Age — one built around billionaires like Elon Musk, but also a flowering of smaller private ventures. To discuss the state of play in the emerging orbital economy, I've brought Ashlee Vance on this episode of Faster, Please! — The Podcast.

Vance is the author of the new book, When the Heavens Went on Sale: The Misfits and Geniuses Racing to Put Space Within Reach. He previous wrote, Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future in 2015.

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In This Episode

* How SpaceX launched a new Space Age (1:13)

* The companies building a “computing shell” around the planet (8:37)

* The proliferation of satellites (15:07)

* The downsides of the emerging space economy (24:07)

Below is an edited transcript of our conversation

How SpaceX launched a new Space Age

James Pethokoukis: The book begins with a story of the first successful orbital launch of a SpaceX Falcon 1. There were three failed attempts, the whole thing is looking pretty dicey about the future of the company in this effort, and on the fourth attempt, September, 2008, they're able to get to orbit and release a payload. Before September, 2008, what does the space economy/space industry look like? Where are we starting?

Ashlee Vance: The starting point: sort of sadly, it looked a lot the same for many, many decades. We had this nation-backed space program, [which was] dominant. There were just a handful of nations, really, that were the major players in all this. Some wealthy people at various stages had come along and tried to commercialize space and make their own rockets, and had varying degrees of success, but no staying power. It ended up that it always takes longer and costs more than you think. And NASA was always sitting there really as your main competitor and undermining your business. With the Falcon 1, it really was this watershed-type moment where finally somebody had succeeded. Yes, SpaceX had people from traditional aerospace, but Elon [Musk] certainly was not from the aerospace world. He had a lot of 20-somethings on his team who had never done this before. It just signaled this new era, or the possibility of a new era, because you had people just who hadn't been part of the old guard doing this thing.

The goal here was to get a rocket into space and get it there way cheaper than what NASA was doing. What was the key breakthrough that allowed that decline in costs? And why didn't NASA just do this?

NASA, and in particular the Department of Defense, had desired this type of thing for a long time: a low-cost rocket that could get to space quickly and often. It seems like this should be doable, but they had really struggled to make it happen. The DOD had funded various efforts. There's a couple things going on. SpaceX had this huge advantage, I think, of this clean slate to this. They came at this without the usual baggage. And in this case, the baggage means a lot of military government contractors who are pricing things quite expensively. They're doing things the way they've always done them, which means you probably don't want to see any sort of failure so you're building it in a ton of redundancy and spending all this extra money to make sure you look good when this thing goes.

SpaceX comes in with this clean slate. The original pitch deck for SpaceX described it as like the Southwest for space. Cost was like at the top of [Elon Musk’s] mind and he wanted to make this cheap. They did have some breakthroughs. The physics around a rocket are the physics, and we've known this for decades. There's not much room for huge breakthroughs in engineering that nobody has thought of yet. But they did come in with this modern, Silicon Valley–style approach to software, particularly to electronics—although this kind of comes in later in SpaceX's history—where SpaceX was going to build a lot of the electronics themselves, often turning to consumer-grade electronics instead of what people call space-grade, which means it's built by a military contractor, it probably costs a thousand times what it should cost, but it's guaranteed to work in space. They had this clean slate. They did things as cheap as possible. The team was small. It wasn't this bloated contractor. That was their primary advantage at the beginning, I would argue. Over time, as they've gotten much bigger and much more money is coming in, there's a whole host of technological advantages. But on the Falcon 1, it really was that clean slate, this low-cost approach.

Obviously if you're beginning your book, which is not a history of SpaceX, but you're beginning with SpaceX, then that must have marked an important inflection point where you could sort of imagine two paths. One path: the 2010s look a lot like the 2000s, which look a lot like the ‘90s. Versus this very different path.

Why is SpaceX important in creating this new path, and what do things look like now?

Yeah. I'm so glad you called that out and you phrased it the way you did with these two paths, because a lot of people—my editors were giving me grief for, “Why are you spending so much time talking about SpaceX in the prologue of this book that's not going to be about SpaceX?” But as you pointed out…

By the way, having dealt with book editors, I can imagine that conversation quite easily.

I wanted people to know how fragile this was, and where it did it come from? You mentioned it: Three of the previous rockets had failed, SpaceX was running out of money, they were running out of credibility, people had been on this island, Kwajalein, for six years, basically losing their minds. If this rocket does not go, I think we do end up in that scenario that you were just talking about, where the 2010s look pretty much like they always had. It was important to me just to give people this history, how hard this is. I see this as this inciting incident. It's funny, because you kind of go from governments and then there were like honest-to-God billionaires. When Elon started SpaceX, he was rich, but he wasn't rich like he is now. We're talking about like a hundred million dollars he put into SpaceX. So the bar had come down quite a bit. But in that moment when this rocket flies and then in the years that follow, when SpaceX really starts to hit its stride, this unlocks all of this.

There was so much enthusiasm for space and young kids who wanted to get into this industry, and it had been slow and boring and the excitement had sort of come out of it. You had the generation of people who had grown up watching Apollo. Those people were getting older, and there wasn't something new to look at for a lot of people who were much younger. And here it is. Here's this company that's making commercial space real. And this guy, Elon, is quite eccentric and interesting, and some people sort of want to be like him. I write about it in the book: It was sort of like the four-minute mile to me. It's like, once somebody does it, then all of a sudden you see lots of people now are breaking the four-minute mile. This thing that seemed impossible, it turns out is possible. You have this unlocking in your head of what people can do. And so I just think across the world, it unlocked this passion, this latent engineering smarts and energy, and made this seem real. So you end up with startups all over the world chasing rockets and satellites.

The companies building a “computing shell” around the planet

In the book, you write, “The future that all these space buffs have already started building is one in which many rockets blast off every day. These rockets will be carrying thousands of satellites that will be placed not all that far above our heads. The satellites will change the way communications work on Earth by, for one, making the internet an inescapable presence with all the good and bad that entails. The satellites will also watch and analyze the earth in previously unfathomable ways. The data centers that have reshaped life on our planet will be transported into orbit. We are, in effect, building a computing shell around the planet.” Other than SpaceX, who are the companies building that computer shell?

The one that comes to mind is the next sort of central actor in the book, which is this company called Planet Labs, which is based in San Francisco. For people who don't know, they already surround the Earth with about 250 imaging satellites. They can take, and they do take, pictures of every spot on the Earth's landmass every day. Multiple pictures. Unlike even the world's biggest governments, China, Russia, the US, which have spice satellites obviously, but they only have a handful of spy satellites. And they tend to only look where interesting things might be happening. Planet sees everything that's happening all the time. And this is not some far-off concept. They had this full constellation up and running in 2018 and have just been adding to it ever since.

At the time they launched, in low-Earth orbit there were about [2,000] satellites. And Planet had put up about 250. They were about 10 percent of all the satellites in space, just from this small private company in California that grew out of NASA Ames, the Silicon Valley center. And so they're indicative of, today, we have many, many, several companies trying to build these space internet constellations, each of which require on the order of 10,000 to 20,000 satellites. You've got more imaging satellites along the lines of Planet that do all kinds of different things. And then you got a ton of scientific satellites. The whole premise is that there are many more ideas yet to come.

When you watch a spy movie, they're always talking about "retasking the satellite,” like there's only one satellite over all of Asia or something. But what we're talking about now is satellites everywhere, looking everywhere, any time you want.

Yeah. That movie stuff is true. That's usually what had to happen. Just as like SpaceX brought the cost of rocket launches down and created this revolution in rocketry, I argue Planet had an attendant effect satellites. I didn't mention before: A traditional satellite is like the size of a school bus, costs $500 million to $2 billion to make. People sit there working on it for like six years. It's supposed to go into space and stay there for 20 years. You can imagine the electronics on a 20-year-old satellite that's trying to do its job…

I can also imagine the tension of that launch going wrong.

Like, that can't go wrong for many reasons. And once the satellite gets up in space, it also has to work, right? That's why you're spending $2 billion, because if that thing doesn't work, a lot of people are losing their jobs at a company or a military outfit is in dire straits. Planet rethought this whole thing. They're like, “Let's make them much smaller. Let's put them closer to Earth.” Almost like a disposable sort of thing. They're sending up dozens at a time. They've had rocket launches — a couple, they had bad luck at the beginning — that blew up and they lost all their satellites on those. But it wasn't a make-or-break moment for the company, because these satellites are relatively cheap: $100,000 each.

They rethought the whole thing, and then they were able to surround the Earth. It basically like a line scanner, and the Earth just turns under these satellites, and it's just photographing all the time. It sounds a lot like what we were talking about before, espionage and spy stuff, and there are uses for that. Although the resolution on these, you can't see somebody's face or anything like that. You mostly look at something like the size of a car. These satellites are geared to what I call monitoring the real-time activity of humans on Earth. Where are we building stuff? Where is our oil being stored? Where is it going? How are our forests? How many trees are in the Amazon? Is somebody cutting them down? The sort of movement of economic activity and environmental activity on Earth.

It reminds me of, if you're trying to determine like the GDP of a country that may not be particularly honest with its government statistics, you could either accept the statistics and try to figure it out, or you could just look at it from space. How many lights are going on? Is there more activity? And try to gauge it in a more visual way. Are there companies doing that for more private-sector reasons?

This happens today. China will say, “We have this much oil in our reserves.” Well, it turns out these satellites can spot all your oil storage systems. Because of the way the oil storage systems work, where they have these floating lids that can go up and down depending on how much oil is in there, the satellites can actually measure the shadow that's being reflected on the side of this tanker. And you could calculate, people argue, very accurately how much oil is being stored. We do this with places like Saudi Arabia. China comes out with its official economic metrics, and now we have a version of the truth where people come back and say, “No, you have way more oil stored up than you've been letting on.” I think this is going to be a big deal. Not to go on a huge tangent, but China's economy appears to be slowing. I'm quite certain the government will put the best possible spin on things and how they're performing. You can look not only at oil, you can look at construction — how many buildings are going up, how many houses are going up — all kinds of economic indicators.

We are now on an exponential curve, and almost all of those satellites are commercial satellites, not military or government satellites that have been added. We're going to go from 10,000, if you look at all the launch manifests for the rocket companies, we get to 100,000 in the next decade. And quite likely 200,000 the decade after that, or maybe sooner. This is a totally new era of what it looks like right above our heads.

The proliferation of satellites

What has the growth in the number of satellites looked like in recent years? And do you have a sense of how that growth will continue over the next decade?

I can do that one. Easy. From like 1960 to 2020, in low-Earth orbit, we had managed to put up about 2,500 satellites. And it was not on an exponential curve. We kind of got a whole bunch up, and then every year you would add maybe 20 to 50 depending on what was going on. It was this very slow, steady march the last few years. So that's 2020: 2,500. Already, as we're sitting here today, there's now about 10,000. So that number has almost quadrupled. It's getting close to quadrupling by the end of this year. We are now on an exponential curve, and almost all of those satellites are commercial satellites, not military or government satellites that have been added. We're going to go from 10,000, if you look at all the launch manifests for the rocket companies, we get to 100,000 in the next decade. And quite likely 200,000 the decade after that, or maybe sooner. This is a totally new era of what it looks like right above our heads.

The astronomers can't be happy.

No. I'm sort of baffled by some of this, because SpaceX and Starlink have been the major driver of this huge increase as they're trying to build out their space internet system. Spacex is now the world's largest satellite manufacturer by several orders of magnitude. And this was no secret. They had to apply for all these licenses to put these satellites up years in advance. There were other people trying to build a space internet. The astronomers never complained until the second SpaceX did its first launch and put the satellites up and everyone could see this kind of string of pearls flying above them as the satellites start to spread out. I was amused and sort of baffled, I guess, that they waited until this was already underway to really start kind of complaining about this. But the die is cast as far as I can tell. You could argue for the Earth-bound telescopes, this is not great. On the other hand, if rocket launches are coming way down, if we're finally putting Moore's Law in space, the opportunity to put scientific instruments above this low-Earth orbit field and do a whole bunch of interesting things increases quite dramatically. If you had to build up $300 million for a rocket launch in the past just to have a go at putting your scientific instrument up, and now you can do it for anywhere from call it like $6 million to $60 million, it's a new era where more people really should get a chance.

Earlier, you talked about SpaceX as the Southwest Airlines of space. But that's really not what it is anymore. Today, it's the high-end company. And other entrepreneurs have filled that space below it. Is that right?

Exactly. SpaceX built that Falcon 1, which was meant to cost just a few million dollars to launch, and then quickly abandoned it. The second it worked, it moved to the much larger Falcon 9, in part because we didn't quite yet have companies like Planet Labs. Planet Labs came around 2012, a few years after the Falcon 1 launch, and really was the first to start thinking about all sending up thousands or hundreds of satellites. And so SpaceX retired the Falcon 1, you had kind of this gap, and then all of a sudden — some of these companies are real, some of them aren't — there's about a hundred rocket startups trying to make a rocket. Even SpaceX today, the Falcon 9 runs about $60 to $70 million a launch. Now you have dozens of companies trying to do launches starting at, if you believe these numbers, like $2 million a launch. Probably like somewhere between $5 and $12 million is a realistic figure. The leader in this category is in the book, this company Rocket Lab founded by Peter Beck. And they have made a rocket called Electron, which has flown now dozens of times and is really sort of like a perfectly engineered small rocket.

If we can have the internet everywhere for everybody, what does that enable? What do these satellites enable?

I think starting with space internet is a good one. Even though we often feel like we're connected to the internet all the time and we have our cell phones, the truth of it is there are these huge gaps all around the planet. And it probably means more on an infrastructure sense than it does on an individual not being able to check their email for a few hours. What we are creating now is a blanket of internet that will have the Earth always connected. This part makes a lot of sense to me. It's very obvious. I just think this is the next step of our technology build out. Just like in the ‘90s, we had to put data centers and fiber everywhere to sort of get the internet going; now, you want this persistent internet that can connect people and all sorts of devices all the time. And that's what we're building in space: This internet heartbeat that's washing over. Everything you've ever heard about, like Internet of Things, sensors on container ships reporting back, or things out in the farm checking the soil moisture: None of this really has worked. And the reason why, is because we haven't had this sort of persistent internet connection. If you think about like a world full of drones and flying cars and self-driving cars — all these things that have to be talking in remote spots to have all this work. It's just this glue that needs to be there. That's like case number one that I think does check out.

And then of course, you have three-and-a-half billion people that just cannot be reached by fiber optic cables today, and they're not allowed to participate in the modern economy. There’s such obvious evidence that the second high-speed internet arrives in a country, education levels go up, economic levels go up. This is just like a fairness thing in letting the whole world participate in what's going on.

That's fantastic because sometimes I think people are unaware of what's going on. Maybe they're kind of aware of SpaceX, but that's pretty much it. And when they think of SpaceX, they're probably mostly thinking of, Elon Musk wants to take us to Mars. I don't think they understand very much about the satellites, unless they've heard astronomers complain about it. I don't think they understand the economic and business case and just that it's all happening.

This is why everyone focuses on the Moon and Mars. And it's all cool and everything, and it is still just very far out. This is why I wrote the book. I was like, you people do not understand that we are building a legit economy right over our heads. And this thing is pretty well underway and I think it is going to change life here on Earth quite quickly.

Are any of the companies that you're looking at involved with creating like new space stations? There's been a lot of talk about creating new space platforms. What they'll do up there, I'm not sure exactly. There's talk about creating different kinds of products and shooting movies and doing biotechnology research. Are any of the companies cover involved with those efforts?

Yeah. In the book, I spend less time on things like space habitats and some of these other businesses. But yes, I do talk about them briefly. But more importantly, I suppose for this conversation, all this is happening. In the past, you've had the International Space Station, this multinational, huge, bureaucratic thing that actually works pretty well. But that’s who's driving it. And now we have a handful of startups making space habitats. We've got SpaceX leading the way with, I guess you could call it tourism: being able to send people to these things, private citizens. This is already happening. We've had private astronauts now going to space on SpaceX rockets. And so they'll go to those habitats. A fascinating startup called Varda launched just a couple months ago. They have put what you could argue is the first manufacturing system in space. It's making medicines. You can do things without gravity pushing on molecules in space that you can't do on Earth. They're trying to make a whole new class of pharmaceuticals and bring them back to Earth. I think that's just the earliest example. There are things like asteroid mining that I thought were total jokes and are still quite far off, but there's a startup, Astro Forge. Same thing: They set up their first test earlier this year. All this stuff is actually happening now. The business cases on these things, I think some will work and some won't, but we're going to find out.

The downsides of the emerging space economy

What's the unnerving aspect? I write about this a lot: We immediately jump to the downsides. What are the costs? So I didn't want to certainly lead with that, but are there things about this that people should be concerned about? Space junk, other things?

I am optimistic on the whole. History would tell us that when humans find a new territory in which to conquer, usually mistakes are made. It doesn't always go really well. We have a reality setting up right now where you had this handful of governments moving very slowly, launching a rocket once a month. Now we're moving to like every day and thousands of satellites, and it really is a bit of ‘whoever gets their first wins’ sort of scenario. Once you start adding a race to these things, that often that doesn't go well.

The thing that everybody is worried about is these satellites crashing into each other and creating a debris field in low-Earth orbit. And obviously none of these companies want that to happen. They're the ones spending hundreds of millions, billions of dollars to build these things. And we do have systems in place to track this stuff, but that becomes a nightmare. There is a scenario called the Kessler Syndrome, where one of these things breaks apart and it just starts ripping into everything else, and then low-Earth orbit becomes essentially unusable. That's not only bad for this new stuff that we're talking about, but there's things like GPS that make the modern world work that would no longer work if that happens. That's a huge issue I think we're going to have.

If you think about, these were nation states that had a lot of control. The rockets are essentially ICBMs more or less. You had a select group of space-faring nations. I think that's all going to change quite soon. Whoever wants a rocket blasting off from their country can have one. Almost anywhere can afford a satellite. You're talking about like a hundred grand just to kind of get going. You're going to have nation states that no longer can really be controlled the way they were or that now have access to space. Are they going to follow all the same rules that everybody else has been following for decades? Probably not.

And then I think the real wild card is Russia. This is a country whose space program was already flagging. SpaceX has eaten up a ton of their business. It's rife with corruption. The war in Ukraine has made them unusable for many, many countries as far as sending up satellites and people. And they are a wild card. Space is not just some flight of fancy for Russia. It's something that's baked deep into the national pride and is near and dear to their hearts. They have no commercial space companies, startups at all. Are they a rational actor in this new world as they see there being this dominant superpower that’s going to go away?

I'm going to finish by asking you the Mars question about SpaceX: Is that going to happen? Do you think that is a serious goal for that company that you can see happening on some sort of timeline that Elon Musk has talked about?

I'm pretty sure it will. I mean, for Elon, you’ve always got to take everything he says with a grain of salt on timelines and ambition and all that. He tends to set these goals. They usually don't happen anywhere close to what he said, but they usually do happen. And in this case, it's not just Elon, right? I know enough of the SpaceX top engineers. They are very convinced Starship is real, that it can get to Mars, I think for sure. You're going to see years of just sending industrial equipment and things like that to Mars long before you send a human. The human question is still…things have to get better. That's a long ride to Mars. And you better be sure you can come back if you want to. A lot of stuff has to happen between here and there. But will SpaceX start putting stuff on Mars in actually sort of the relatively near-ish future? Yes. I'm quite convinced of that.

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