SPACE UBERIZED?

Honorary President of the CEPS [Center for Long Term Strategic Studies], Military Engineer, and alumnus of MIT (Massachusetts Institute of Technology), Philippe Cothier has been vice-president of the Matra Défense-Espace Group. He is a Political Science l

If the neologism «uberization» sounds gentler than «digital tsunami», make no mistake: against a background of disruptive innovation and information technol og i es, ub e r i z a t i o n refers to the radical upheaval of the business models of well established conventional players in their respective fields of activity. Uberization can be very detrimental. As an example, the Best Western hotel chain admits that the Airbnb pheno- menon costs it about 30% of its clientele. What about Space, the last spatial domain thought to be subject to such earth-shattering change? And yet, this is indeed the case today. The big difference, however, is that the challenge to business models that have been established for decades is not originating as much from the irruption of technological innovations as from a radical change in approach that only external players could bring about. When Michael Griffin, with his atypical profile, became the head of NASA in 2005, the context was one of a highly institutionalized agency heavy on convictions and little inclined to take risks (with the exception of space exploration programs). Michael Griffin, previously the president of In-Q-Tel, the CIA’s venture capital fund, set out to initiate the NASA management in new forms of innovation: disruptive innovation (that is, how established entities must adopt new business models and/or technologies and anticipate the future needs of their clients, or otherwise become marginalized), or so-called open innovation (how companies can no longer rely solely on their own R&D and must constantly keep abreast of technologies, inventions, and patents by other economic players). At that time, a certain Elon Musk, co-founder of PayPal in 1998, a Silicon Valley Internet company, made $175 million when the company was bought out by eBay in 2002. That same year he created Space Exploration Technologies (SpaceX) to develop the means for “affordable space travel”. In 2006, one year after becoming the head of NASA, Mi- chael Griffin signed a $400 million contract with SpaceX for space travel, bypassing the usual channels. Elon Musk added $100 million of his own capital and raised another $350 million from external participants. Thus was born the line of Falcon launchers with NASA’s full support. Better still, NASA is gratified to see SpaceX breathe new life into its old reusable launcher designs. We know the rest of the story: after this atypical gestation, the Falcon line—which all the big space honchos said was destined to failure—racked up one success after the other in record time. The launch cost per satellite is nearly half as much as with conventional launchers, and if the reusability feature becomes operational, the cost will drop to one fourth to one fifth as much. In just a few years, SpaceX became the only real compe-

titor to Arianespace, with the launching of its new Ariane 6 being scheduled for 2012. Lastly, in addition to the launchers, SpaceX has successfully developed and launched the Dragon space transport capsule, which has shuttled all kinds of equipment between Earth and the International Space Station. True, Falcon 9 did experience failure (only one to date out of 18 launches) in June 2015, but while in Europe a special commission would have been set up, preventing any launches for two years, SpaceX quickly learned its technical lessons from the failure. The paradigm shift is radical: “Failure is not an option” becomes “Failure is accepted because it is part of the learning process”. The next launch only six months later (December 2015) speaks volumes: not only did the launch complete its mission of putting satel- lites into orbit, the vertical descent and successful landing of the launcher’s first stage made history. The April 2016 splashdown of the Falcon 9 drove the point home. A VERY LARGE NUMBER OF SATELLITES INEXPENSIVE In the field of launchers, Elon Musk and SpaceX cannot be mentioned without also mentioning Jeff Bezos, founder of Amazon as well as Blue Origin, the company which also made space history with the successful launch in November 2015 of its New Shepard rocket intended for space tourism, and its vertical descent culminating in a troublefree touchdown. The next two flights experienced the same success. The path to launcher reusability is now open. The new

Internet players are going to rush down that path, accompanied by venture capital committed to the cause, all too happy to seize the opportunities of such a revolution. “Companies supported by venture capital, such as SpaceX, Skybox, and Planet Labs, have a disruptive effect on the aerospace industry (launchers, satellites, transports) with products that are better, less expensive, and more readily available”, said venture capitalist David Cowan, unanimously respected in Silicon Valley, in March 2015. If this path is followed through to the end, a tsunami is what will hit the space industry. Elon Musk and Jeff Bezos, both of whom come from the same world marked by Moore’s Law, the culture of “free” so characteristic of the Internet, and quasi unlimited access to financial resources, are revolutionizing the business models of Space access. It is their mentality, forged in Silicon Valley, that has allowed such a feat in this field, and not the technologies of the Internet per se. It is worth repeating that an innovation is not only technological: timing is equally important. The Internet tycoons have understood this well: today, Silicon Valley is launching new constellations based entirely on the leitmotiv of «less expensive, better performance, and faster implementation». This time, technology and finance have converged. The constellations consist of a very large number of satellites, each one very inexpensive. To achieve such cost savings, mini-satellites making maximum use of components from other industries, without overspecification and with the processing that is customarily performed by the on-board electronics being placed on the ground, simply need to be produced (!) in large quantities. Such an approach makes it possible to reduce the cost of certain equipment items by a factor of 50 to 100, with performance and reliability perhaps being individually inferior compared to traditional equipment, but offset by the large number of satellites, of which the enormous volume of data is processed on the ground using methods (Data Science) that the Internet masters better than anyone else.

THE INDUSTRY WILL REQUIRE A REVOLUTION TO SURVIVE

The massive processing of partially redundant data can result in performance nearly equal to that of conventional satellite systems. In addition, these constellations are introducing new performance features: in Earth observation, where the revisit time is two days, the Planet Labs constellation enables revisit times of just a few hours. The Google/Skybox constellation offers similar services, which they are eager to offer to the military. These mini-satellites are considered “expendable”: the OneWeb telecom constellation is an example: 600 satellites out of 900 manufactured. Google, in conjunction with SpaceX, announced a constellation of 4000 satellites. The launch means are also being reconsidered: for instance, Planet Labs recently sent ten of its Dove mini-observation satellites via the SpaceX Dragon transport to the International Space Station. The space station then proceeded to “inject” the mini-satellites into their low orbit. The cost of a conventional launch would have been prohibitive. Other examples could be mentioned, but the picture is clear: a combination of various factors—technologies specific to the Internet (Data Science first and foremost), the obsession with cost reduction, the freedom of approach, and enthusiastic support by venture capital—has suddenly awakened the sleeping beauty that Space has become. The space industry will continue to produce conventional launchers and satellites, but in the case of commercial clients, the industry will require a Copernican revolution to survive the arrival of these new, particularly agile players. Yes, Space can indeed be “uberized”.