Prepare for a Space Economy that Can Leverage SpaceX’s Starship
SpaceX’s Starship is about to become a reality, bringing unprecedented payload capacity, fairing volume and maybe price reductions to satellite operators. This paves the way for new, ambitious satellite designs, missions, and business models.
August 28, 2023
Despite failing to reach orbit last April and highlighting the challenges of super heavy launch campaigns, SpaceX’s Starship will soon become a reality, owing to extensive private funding, to an unprecedented development pace, to NASA’s support through the Human Landing System contract, and even an early commercial backlog. Starship will bring unprecedented payload capacity, fairing volume and maybe price reductions to the market, paving the way for new, ambitious satellite designs, missions, and business models. However, due to SpaceX commitments to NASA’s Artemis program, to its own Starlink launch needs, and to the inevitably slow ramp-up of a super heavy launcher, it is unclear how soon Starship will be available for conventional satellite demand.
SpaceX’s latest capacity estimates for Starship (at 150 metric tonnes to Low-Earth Orbit in reusable configuration and up to 250 metric tonnes in expendable) offset that of any other launcher in history by a long shot. This adds to the long list of rupture innovations (in an industry used to incremental ones) that it would bring to the market, including its 9-meter-wide fairing, two-stage reusability (which may enable a price drop and launching at low fill rates economically), and unique production model (enabled by use of stainless steel for ease of its manipulation and welding). With such potential reaching the market soon, it is time to prepare for Starship’s impact on the space economy.
Satellites to Go Supersize?
Starship’s unique features carry many promises for satellite operators. First, its 9-meter-wide fairing and virtually unlimited payload capacity pave the way for new satellite designs. Operators could move toward larger, more performant, and power-hungry spacecraft. With larger antennas, solar panels, or sensors, they could drastically increase their satellites’ CapEx efficiency. Large fairings also simplify architecture by partially removing the need for deployable structures and even costly miniaturization – one of the historical leitmotivs of satellite design. Hence, operators could move toward bulkier, less complex, easier to manufacture satellites.
However, the market should expect latency between Starship going orbital and satellite operators adapting their designs to leverage its features. Operators are inherently reticent to modify their designs, especially to leverage an unproven solution, even more so if there if there is just one supplier. Several years of demonstration and the addition of other super heavy launchers (Blue Origin’s New Glenn ahead) will likely be necessary before we see the first adaptations. Furthermore, Starship’s initial markets will not be conventional satellites (although it already has Geostationary Orbit launch orders), but rather contracts with NASA for the Artemis program and its own Starlink constellation.
Alongside superior capacity and volume, SpaceX has publicized a drastic reduction in launch cost, and potentially launch prices, owing to full reusability. As all Starship elements are reused, with enough launches, manufacturing costs per launch could be rendered insignificant, with the only additional costs being fuel and operations. Elon Musk has publicized a launch cost of $100 per kilogram over “numerous reuses” (comparing with about $2,300 per kilogram on Falcon Heavy at full capacity and $6,000 per kilogram entry price on Transporter rideshares). However, there is no evidence supporting such reduction so far. There is no guarantee that SpaceX would reflect a cost reduction with a price reduction for customers, especially as the company has a near monopoly over heavy launch in the foreseeable near future (due to delays with ULA and Arianespace’s new launchers, and saturation of their backlog by Amazon Kuiper).
Starship could also bring new potential for rapid constellation batch deployment. Large constellations are keen on deploying their satellites rapidly in order to begin operations as soon as possible. With its capacity, Starship could theoretically deploy entire constellations in very few launches, reigniting engines multiple times to reach several inclinations in one launch. In fact, this is essential for SpaceX’s own broadband revenue model, which will rely on the ability to rapidly deploy and replenish the future, heavier second generation of Starlink satellites (to weigh an estimated 1200 kilograms each, comparing to 200 kilograms for the first generation). According to SpaceX, Starship could deploy over 50 second generation Starlink per launch.
Starship could even be used to address the smallsat rideshare launch market as a complementary market. Although its capacity is arguably overkill for this market (even filling Falcon 9 Transporter flights takes up to a year with scattered smallsat demand, and they still launch with low fill rates), its full reusability may enable it to launch economically with a very low fill rate, since all elements are reused anyways. Still, this will likely be a low priority market in the foreseeable future.
Space exploration and human spaceflight are already being redefined too, starting with NASA’s Artemis program, as single large monolithic spacecraft could replace a constellation of capabilities including launcher, capsule, transfer stage and lander (provided enough refueling missions).
There are many more propositions to leverage Starship’s unprecedented dimensions. For instance, it could theoretically launch entire space stations as single modules (removing the need for in-space assembly), although SpaceX could compete with such clients by making a Starship upper stage into a space station by itself (having, in its future crew configuration, similar pressurized volume as the ISS). It could also serve as structure for a large space telescope, as a refueling station for spacecraft (in-space cryogenic refueling is a critical capability for NASA Artemis missions), as a mean of deploying ambitious active debris removal solutions, and many more.
A Long Road to Economic Validation and Market Adoption
Until then, SpaceX must still achieve orbital flight and introduce operational versions for its priority markets, starting with a Lunar landing version and a Tanker version for NASA’s Artemis program, and a LEO version for Starlink deployments. These markets are SpaceX’s near-term priority, its long term priority being spaceflight to Mars. To fulfill its contract with NASA for a single crew landing on the Moon, it will need to launch Starship up to 15 times (including one Lunar Starship and 14 Tanker Starships) within six months. As for its own Starlink launches, they are a priority for SpaceX, as they are to become its main source of revenue. Hence, transporting conventional satellite demand to LEO and GEO is inevitably a secondary target.
Meanwhile, there is no guarantee of large-scale market adoption by conventional satellite operators in the foreseeable future. Starship would have to demonstrate reliability, affordability and regular launch opportunities for them in order to become more attractive than conventional heavy launchers. Because of this and because of SpaceX obligations to NASA, it is possible that Starship will remain almost exclusive to NASA and to SpaceX’s endogenous demand until the end of the decade.
Finally, operations will likely be slower to ramp-up than most observers expect due to technical challenges and upgrades with the launcher and launch tower, further regulatory and environmental clearance obstacles, launch infrastructure availability (launch rates from the Cape Canaveral will have to accommodate the other users on the base), strict certification by NASA for human spaceflight, and the simple scale of super heavy launch campaigns. VS
Gabriel Deville is a space industry consultant at Euroconsult in Montreal, Canada. He specializes in satellite upstream activities, launcher economics, space logistics and space sector financing. Gabriel is the Editor in Chief for Euroconsult’s Space Logistics Markets and Space Market Monitoring reports.
Lead photo credit: SpaceX photo taken before the Starship test flight mission in April 2023