Griffin on Commercialization

06/22/05 00:00:00    

By Michael Mealling

At a Space Transportation Association breakfast yesterday Mike Griffin laid out out his plans for commercialization. Keith Cowing of NASAWatch had to do the transcript himself and has the entire thing here. Overall I like what he's saying, I still have a few issues though:

bq.

What I would like to do is be able to buy those services from industry - and in fact I'd like to be able to buy those services from the industry represented in this group: the Space Transportation Association.

I can't tell if this is a throw away line considering his audience or if he's really saying that he prefers one set of potential providers over others. I think he does since he essentially lays out the satellite model of procurement: pick a big satellite vendor early on and then marry them financially until the product is out there and profitable. Its almost like a prime contractor but with fix priced contracts. If they do follow that model I can't see how he's going to create the competition he wants.

I think he thinks he's going to pick a winner early and then help others along with study money:

bq.

and [you should] look for us to pick a “leader” with whom we will get started - and also to fund a couple of “followers” at the study level in case the leader falls off the track.

which again, does little to help create competition. But its still better than nothing. Unless something amazing happens I suspect the “leader” will be a BoLock derivative where they use the winning CEV design to compete against itself. I could see where t/Space might get some of that study money and that might help but expecting the capital markets to just wake up and say “whee, let's give t/Space butt loads of money with no customer contract in hand” isn't going to fly. Along with that study money is going to have to be some kind of agreement that says if you meet milestones X,Y and Z we will use your service.

IMHO, Mike isn't taking an entreprenurial view. Instead he's attempting to use a mature economic model that evolved within a particular industry verticle that may not be the right one in a few years (think what the satellite business would look like using Falcon V class launches of swarms of nanosats). Its very much a top down view. I don't know why I was expecting something else but I guess this is what we get. For one thing I expect the memebershp of the STA to grow considerably over the next few weeks.