2020 is the year of $1 trillion space economy
The first time I can find "space economy" and "trillion dollars" in the same sentence is in 1984, when thencongressman Robert Walker told the Associated Press that a space station in low-Earth orbit could "lead to a halftrillion-dollar economy in space by the turn of the century."
Some 35 years later, we've fallen short of the mark. The best estimates of the money made from space-which these days mostly come from building and operating rockets and satellites, and using them to provide services back on Earth-is about $400 billion. To be fair to Walker, now a lobbyist who served on US president Donald Trump's NASA transition team, the space station under discussion didn't begin operations until 2000.
The turn of the century was a hard time for the space economy, as tech bubble-driven dreams of internet satellites and venture-backed moon missions fizzled out alongside the stock market. But a lot has changed since then, and the dream of a trillion dollar space economy is now cited by everyone from government officials and space entrepreneurs to Fortune 500 executives and Wall Street investment banks. Analysts at Morgan Stanley and Goldman Sachs have predicted that economic activity in space will become a multi-trillion-dollar market in the coming decades, and the US Bureau of Economic Analysis has launched a new initiative to measure it.
The trends driving this optimism are the same ones driving the tech economy writ large: The increasing power and miniaturization of transistors, batteries and solar panels, generated in part by the smartphone revolution; the convergence of telecommunications, broadcast media, commerce and nearly everything else into "the internet"; and, naturally, geopolitical tensions that still have governments spending on space and, increasingly, hiring private companies.
Elon Musk's SpaceX plans to launch its fifth rocket full of proprietary internet satellites in January. That will raise the total number of satellites in the company's Starlink constellation to about 300, well on the way to the roughly 480 the company's executives say they'll need to begin offering broadband internet access to customers on Earth. How exactly that will happen-as a direct to consumer product or as a partnership with terrestrial telecom firms-remains to be seen, but Musk and his team are confident that if they can build low-latency connectivity, the buyers will come. SpaceX is hardly the only group making this bet: OneWeb, Telesat and Amazon are also investing billions in networks of thousands of internet connectivity satellites. Apple is also reportedly chasing the dream of space connectivity.
To be sure, this isn't the first time satellite internet in space on a mass scale has been tried-Bill Gates notably invested in a failed effort called Teledesic in the 1990s. What's different is that all the components-satellites and the rockets that launch them-are an order of magnitude cheaper, the latter thanks mostly to the efforts of Musk to drive down the cost of launch. And meanwhile, the demand for internet access isn't a novelty, but ravenous and central to the economy.
Most of the money made in space is on the back of satellite-provided service, so these efforts are likely to meaningfully increase the space economy. The huge increase in satellites (there are about 2,300 operational satellites in space right now) will bring costs as well as benefits, with astronomers worried about interference and everyone fretting about managing all that traffic and dodging space debris. Yet that is likely to spur investment in new satellite servicing businesses that seek to keep lowEarth orbit clean and efficient.
Venture capitalists have also been throwing millions of dollars at small satellite companies with big dreams. Planet, Hawkeye360, Spire, Capella Space, BlackSky and Swarm are just some of the firms who have raised cash, launched satellites, and are planning for a big 2020. Their business models vary, from tracking radio signals and gathering radar data to imaging every inch of the Earth to communicating with internet-of-things devices.
But they all depend on the falling cost of building and operating spacecraft to enable their work.