A week of change in the space sector portends bigger shifts to come
When people in the defense community talk about change, it is often portrayed as a foreseeable or knowable drift from the status quo. It is the kind of thing that conferences can be planned around well in advance. The binds of a bilateral military relationship slowly loosen month by month or the costs for a weapons system creep higher year by year.
Then there is the kind of dramatic, sudden shift that was seen in the space sector this week.
Over the course of a matter of days, events unfolded that portend big changes for the future of U.S. national security and space, particularly how the defense and intelligence community launch the satellites that are a staple of operations worldwide.
Within the defense industry, Alliant Techsystems Inc., known as ATK, announced it was merging its aerospace and defense business with Orbital Sciences Corp. The deal brings together two publicly-held companies with extensive government launch businesses and a track record of collaborating on cutting-edge space programs. ATK, which provided the solid rocket motors for the Space Shuttle, has been a supplier of engines to Orbital Sciences. This creates a new player, with the potential to challenge the industry’s incumbents in the space launch sector by virtue of its increased contracting heft and its combined pools of engineers.
It comes at an auspicious time for the U.S. to be able to develop more options for its military space launch programs. Currently, American astronauts ride Russian rockets to reach the International Space Station while America’s biggest spy satellites are frequently boosted into orbit atop rockets powered by RD-180 engines, which are bought from Russia’s NPO Energomash.
Given the turmoil and increasing tension with Russia, U.S. sanctions recently ratcheted up against the country’s defense industry. This prompted Russia’s Deputy Prime Minister Dmitry Rogozin to quip on his Twitter account that NASA should use trampolines to send its astronauts into orbit instead of relying on Russia.
There are better options than trampolines — and Russia. Developing a U.S.-designed and built liquid-fuelled rocket engine is one of them, though that will potentially take years. Another avenue is to look to the commercial space launch market, whose firms are eager to go after government contracts.
To that end, SpaceX was granted an injunction by a federal judge this week that will thwart current Air Force procurement plans to continue buying the Russian RD-180 engines as part of a launch program worth more than $9 billion over the next five years, according to the Government Accountability Office. SpaceX believes commercial companies should have a viable shot at competing for the work and filed the suit accordingly. SpaceX is already working with NASA to re-supply the International Space Station, but the company is not yet certified to carry passengers, nor heavy military satellite payloads.
This is an issue as much about sole-source contracting as it is about breaking a procurement paradigm that needs to better accommodate commercial-market players who can be more nimble and less costly. It is also tied to a much larger question about the Pentagon’s stance toward buying from outside its usual pool of suppliers in order to choose from a given sector’s most innovative, or affordable, options. The defense market, as well as new and legacy firms alike, all benefit from the pressure that more competitors can provide. So too do taxpayers and war fighters.
Against a post-war backdrop for the U.S. military, much in the defense world is in flux right now due to budget, policy and geopolitical factors. It is fitting, then, that this is becoming a period of transformational changes for the industry. Space is becoming a hot spot in this evolution, and rightly so. The country is at once dependent on legacy systems and procurement regulations while needing more than ever to avail itself to the leading edge in an area that was once seen as a distinctly American strategic advantage.
