On July 20, 1969, 650 million people watched as Neil Armstrong uttered those immortal words: “That’s one small step for man, one giant leap for mankind.” In the 50 years since the launch of Apollo 11, NASA has developed the space shuttle program, sent five rovers to Mars, launched the Hubble telescope, and sent research satellites to Jupiter. In all these missions, NASA collaborated with private companies to design and manufacture spacecraft and equipment. Now, the Agency is undergoing a fundamental shift. Instead of NASA spearheading the development of new projects, the Agency will act as a collaborator. In theory, private competition will help ensure NASA gets the greatest capability at the lowest cost to the taxpayer. During this transition, the Agency will have to balance promoting a commercial space economy and fulfilling its own mission of research and exploration.
Recently, the new strategy of outsourcing to the commercial sector has played out with NASA’s plan for the next generation of space stations. The current space station, the International Space Station (ISS), was launched in 1998 and serves as a cooperative between the governments of the United States, Russia, China, Japan, and various European nations. Now, the ISS has reached the end of its life and will be decommissioned in 2030. In preparation, NASA is partnering with private companies to develop several space stations to replace the ISS. These space stations will house both commercial and research activities. Blue Origin, Nanorack, and Northrop Grumman have already won contracts totaling $415.6 million to develop their own stations. NASA also funds Starlab, a joint venture between Voyager Space Holdings and Lockheed Martin. The Starlab will additionally be decorated by Hilton as they explore the commercial viability of space tourism. In partnering with private companies, NASA hopes to save up to $1.8 billion annually by 2033. This would free up resources for the Agency to invest in other missions. While the cost savings represent an incredible opportunity for NASA, the Agency must make sure the savings are worth it.
In over 20 years of service, research aboard the ISS has led to breakthroughs in disease, agriculture, microbiology, fluid physics, space manufacturing, and human physiological response to microgravity. All of the research conducted on the ISS will inevitably continue to benefit private companies and the growing space economy. While the new space stations will largely be designated for research, NASA must ensure independent university and government researchers are not priced out. With limited capacity, private companies may give experiment space to the highest bidder. This would, in effect, exclude university and government-funded researchers.
According to their statement of purpose, the fundamental goal of NASA is to “develop and fund space technologies that will enable future exploration and benefit life on Earth.” Exploratory missions are at the Agency’s core, and the current missions to Mars are at the cutting edge of NASA’s work. To transport equipment and eventually humans to Mars, NASA has divided a $300 million portfolio among 13 companies to develop launch services. Among these companies is Jeff Bezos’ Blue Origin, which was selected to provide its New Glenn heavy-lift rocket. NASA chose Blue Origin for the project in part to promote competition between the company and Space X. This contract is one of the first large-scale examples of NASA stepping in to encourage competition in the commercial space economy. Ensuring competition will be essential for NASA’s new model to succeed. Other government agencies have participated in similar partnerships. The Department of Defense, for example, has long relied on private contractors for new technology, capability, and infrastructure. Now that NASA is doing the same, the Agency must be careful not to fall into the same traps. If NASA wants to maximize the savings from outsourcing, maintaining competition among private firms will be essential.
Finally, as NASA attempts to bolster the space economy, it should not overlook the contributions it has already made. According to an October 2022 report, NASA helped generate $71.2 billion for the economy in 2021, supporting almost 340,000 jobs, and generated $7.7 billion in tax revenue. Given NASA’s budget of $23.3 billion, the Agency delivered a more than 300 percent return for the economy. The report additionally highlights the current strength of the space economy. As such, while private companies certainly create a lot of potential for growth, outsourcing on its own does not guarantee gains for the space economy.
NASA is undergoing the biggest transition in Agency history. By scaling back on in-house production and outsourcing to private companies, the Agency hopes to save time and money. If done correctly, this could usher in a new era of unmatched science, discovery, and exploration in space.