Wall Street Pit

SpaceX Has Laid the Pipes for the Next Internet

“It’s a fantastic time to be in the industry.”

That’s is how Carissa Bryce Christensen, founder of Bryce Space and Technology research and consultancy firm described the current state of the space industry. And SpaceX, the aerospace company that keeps  revolutionizing people’s mindsets about space as a business deserves most of the credit. Led by entrepreneur billionaire  Elon Musk, SpaceX’s fundamental mission is that of offering low cost space transportation and starting the colonization of Mars by year 2022.

It’s worth pointing out that Musk is not the only rich-guy-space-enthusiast who is pumping life back into the US space industry, especially after the Space Shuttle retired in 2011. There’s Microsoft co-founder and philanthropist Paul Allen who founded Stratolaunch Systems, a Seattle-based company developing a new air launch to orbit system. Amazon’s Jeff Bezos and Virgin Group’s Richard Branson also belong to the club. Bezos founded Blue Origins while Branson has Virgin Galactic, two companies that cater to space tourism and science missions.

These four visionaries and astute investors however, are not the only ones who have stakes in the business of outer space. Christensen noted that since year 2000, several startups have attracted more than $16.5 billion of investments in the field. The figure has funded 140 new firms, with two-thirds of them launched during the last five years. In 2016 alone, nearly $3 billion were pumped into 43 startup ventures.


But the most interesting thing is that the majority of these startups are focused on one thing—building satellites that will be launched into outer space. It is potentially a very lucrative business, as satellites serve a variety of purposes, including studying agricultural trends and water pollution patterns, tracking ships in navigation, weather monitoring, etc, etc. Space internet though, which is based on the idea of building a second Internet in space and use it at some point to connect people on Mars to the Web, it’s obviously not only the most interesting of all, but also the most profitable. In fact, an astonishing $1 trillion annual revenue could be generated through satellites that could provide internet access to billions of people worldwide.

A limited number of players have already had a head-start in the rapidly evolving business of space internet, seen by the Silicon Valley as a fundamental technology. SES and OneWeb have already unveiled their own plans to create individual satellite systems. Luxembourg-based satellite operator SES recently made an initial order of seven new satellites from Boeing. The set is to be added to SES’ current network of 20 first-generation “O3b” satellites. Global communications company OneWeb has far bigger plans; it intends to install its very own network of 720 low-orbit microsatellites. Dubbed as the OneWeb satellite constellation, the network is projected to start providing internet services as early as 2019.

And here we have SpaceX in the mix again. The company is better known for delivering all kinds of space cargoes, including different types of satellites for its commercial customers. Though rockets and spacecrafts are the company’s strong selling points, SpaceX is also involved in the business of space internet. The company has already revealed a plan to put 4,425 internet-providing satellites in space as early as year 2019. Of course, SpaceX will use its Falcon rockets for launching, bringing more cost-efficiency to their business model. What’s more, should this be successfully accomplished by SpaceX, it will make history given that the large number of more than 4 thousand installed satellites will be three times what we currently have in use today.

SES, OneWeb and SpaceX however, are not the only private firms in space internet mix. Google, Facebook, Analog Devices, Boeing, Northrup Grumman, Lockheed Martin an a number of other companies are firmly in the mix. And who can blame them. The potential for significant new streams of revenues as a result of this unavoidable massive wave that’s going to play out over decades is there for the grabbing.

Interestingly, in the past, the prevalent impression of the space industry has been that of being too high-tech and the development of which takes a long time to complete. Additionally, the continuous and intensive pace aspect of it in terms of capitalization has always been part of the picture. But SpaceX changed all that with its affordable services. “Musk changed the narrative, transforming the way people think and talk about space technology in a very inspirational way,” added Christensen.

SpaceX’s success made it feasible for aspiring “astropreneurs” to build satellites and rockets. It is not surprising that SpaceX’s 15-year existence, coincides with the takeoff and booming of the private space industry, whose turning point came when the SpaceX Dragon became the first commercial spacecraft to visit the International Space Station, sparking the imagination of hedge fund managers (salivating over the potential of raking more $ thanks to their compensation structure), conservationists, government agencies but most importantly, science fiction loving entrepreneurs everywhere.  It would be fair to say, SpaceX has laid the pipes for the next Internet.