What happened

Mixed outcomes. SpaceX and Orbital completed demonstration missions; Rocketplane Kistler did not. Staged commitments produced working capability from some participants, but financing remained uncertain and negotiated service prices exceeded initial proposals.

What might explain it

Participant explanation

Staged payments and credible customer demand helped turn emerging capability into an investable undertaking. Commercial Orbital Transportation Services: A New Era in Spaceflight

Alternative explanation: Firm capability, founder capital and the availability of private finance also differed between participants.

Plausible

Terminating one partner and selecting another limited dependence on a single supplier. Commercial Orbital Transportation Services: A New Era in Spaceflight NASA’s Management of Commercial Orbital Transportation Services and ISS Commercial Resupply Contracts

Alternative explanation: The result could also reflect which firms were selected and what capabilities they already possessed; replacing a partner does not by itself explain overall program costs.

Understanding the outcome

Complementarity of public procurement and entrepreneurial capacity

An emerging supplier needs more than a promising prototype. Funding, access to expertise, and a credible customer can make the next stage possible while leaving important risks with the firm. Commercial Orbital Transportation Services: A New Era in Spaceflight NASA’s Management of Commercial Orbital Transportation Services and ISS Commercial Resupply Contracts

Space transport combines unusually high entry costs with a small number of major customers. A market with many small buyers offers a different basis for financing.

Questions to take into practice

  • Does a supplier have a credible customer after the prototype?
  • What can be stopped or replaced without abandoning the entire mission?

What remains uncertain

  • How would costs and delivery times have differed under another procurement arrangement? Comparing prototypes alone would miss later service prices, continuing public support, and the costs of unsuccessful participants.

Sources