Press Release

Promising Commercial Human Spaceflight Industry Seeks Government Support

By SpaceRef Editor
July 24, 2003
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WASHINGTON, D.C. – An emerging demand for commercial human spaceflight has attracted the interest of a number of space tourism entrepreneurs and prompted concerns regarding regulation of this new industry.  Today, witnesses at a bicameral hearing of the House Science Subcommittee on Space and Aeronautics and the Senate Science, Technology, and Space Subcommittee testified on future opportunities for space travel, as well as issues surrounding government regulations and passenger liability for this new frontier of tourism. 

Space and Aeronautics Subcommittee Chair Dana Rohrabacher (R-CA) said, “Opening space to those willing to pay for the experience of it offers our industrial-base a new source of technical innovation well beyond government’s sphere of activities.  Simply put, by building and flying space launch vehicles, commercial space entrepreneurs have overcome a barrier that apparently continues to plague NASA’s bureaucratic inertia.”

“Commercial human space flight may be an idea whose time is about to come,” added Space Subcommittee Ranking Member Bart Gordon (D-TN).  However, if it is to succeed, industry and government need to enter into a serious dialogue on the issues of appropriate safety standards and the extent to which it is appropriate for government to indemnify the companies against the consequences of launch accidents.”

Mr. Phil McAlister of Futron Corporation emphasized a positive outlook for space travel, based on a recent survey Futron conducted of affluent Americans.  “Futron’s forecast for suborbital space travel projects that by 2021, over 15,000 passengers could be flying annually, representing revenues in excess of $700 million,” McAlister said. 

Also testifying was the first space tourist in history, Dennis Tito, who said that his opinion of the commercial space industry has changed after “talking to thousands of people who want to fly into space.”  He even told Senate and House members that he would “quite possibly” invest in a reusable launch vehicle company, but added that government regulation could dilute investment opportunities.

Regulation of reusable launch vehicles (RLVs) complicates the industry, however.  The FAA’s Aircraft Certification and Regulations Office (AVR), which regulate the commercial airline industry, and the Associate Administrator for Commercial Space Transportation (AST), which regulate traditional rockets, both claim jurisdiction over commercial spaceflight regulation. 

Rohrabacher noted, “Unfortunately, a major barrier for new space launch ventures is the uncertainty in the government’s ability to create a stable regulatory environment.  It is clear the future of space commercialization hinges on the Federal Aviation Administration’s ability to resolve the issue of how to regulate commercial human spaceflight operations.  In my view, the federal government has the power to promote investor confidence by providing clear regulatory guidelines for commercial space transportation operators, or strangle the baby in the cradle.”

Witnesses seemed to agree that commercial spaceflight should not be regulated as stringently as regular commercial flight in the aerospace industry.  Elon Musk, CEO of SPACEX suggested that the government “adopt a nurturing and supportive approach to new launch vehicle developments,” and “recognize the early and experimental nature of the industry.”  Musk, as well as Jeff Greason of XCOR Aerospace addressed the burden imposed on them.  Barring excessive government regulation, both expect to fly paying passengers to space within three to five years.

Members at the hearing stressed safety and questioned the government’s role in liability protections.  Tito explained that a repeated demonstration of successful flight would establish a record of safty.  Greason added, “it is safe enough when customers start showing up.”  Witnesses also agreed that to get the industry off the ground, potential customers would have to waive all claims of liability against the companies taking them to space.

Finally, the industry entrepreneurs expressed a desire for Congress to indemnify the companies against the consequences of launch accidents, similar to the indemnification it currently provides the U.S. space transportation industry.  Jon Kutler of Quarterdeck Investment Partners provided suggestions on how the government can increase research and development in the space industry with the “dual use” of supporting government programs as well as private industry.  He concluded his testimony with a quote from The Right Stuff, “No bucks, no Buck Rogers.”

SpaceRef staff editor.