Space & Astronomy/Space and Astronomy (October 1993).iso/mac/TEXT/SPACEDIG/V16_6/V16NO643.TXT

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Date: Fri, 28 May 93 14:34:21
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Subject: Space Digest V16 #643
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Space Digest                Fri, 28 May 93       Volume 16 : Issue 643

Today's Topics:
                  Commercial Space News #23 [Part 1]

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Date: 27 May 93 21:28:38
From: [e-mail]
Subject: Commercial Space News #23 [Part 1]
Newsgroups: sci.space

SPACE TECHNOLOGY INVESTOR/COMMERCIAL SPACE NEWS -- No. 23

   This is number twenty-three in an irregular series on commercial
space activities.  The commentaries included are my thoughts on
these developments.

   I've managed to get moderately caught up, and been able to cover
most of the major happenings in commercial space developments -- but
I've had to skim past lots of interesting data of lesser importance
without noting it here.   Glancing through what I've compiled, this
issue seems to pretty much concentrate on recent happenings with
space transportation systems and communications systems.  And while
I've sifted out many items, the batch for this column is still
pretty long.  I'll work at keeping this down to a readable length.
Have fun!

CONTENTS
1- SOUTH AFRICA SHUTS DOWN COMMERCIAL LAUNCH VENTURE
2- BRAZILIAN LAUNCH TESTS STAGES FOR SPACE LAUNCHER
3- INMARSAT LOOKS AT GLOBAL PERSONAL COMMUNICATIONS SYSTEMS
4- INTELSAT LEASES RUSSIAN GEO SATELLITES
5- USAF "SPACE LAUNCH GRANTS" TARGET DUAL USE LAUNCH INFRASTRUCTURE
6- IRIDIUM SIGNS UP INVESTORS FOR LEO CONSTELLATION
7- OSC LINES UP FINANCING FOR ORBCOMM
8- LOCKHEED NOW SELLING SMALL LAUNCH VEHICLE
9- COMMERCIALLY DEVELOPED SPACE WAKE SHIELD READIES FOR FLIGHT
10-OTHER NASA SUPPORTED COMMERCIAL VENTURES ENCOUNTER PROBLEMS
11-AEROSPACE FIRMS PLAN JOINT STUDY OF COMMERCIAL SPACE MARKET
12-INDEX RESULTS THROUGH APRIL 1993
FINAL NOTES

ARTICLES
-------------------------------------------------------------------
1- SOUTH AFRICA SHUTS DOWN COMMERCIAL LAUNCH VENTURE
   In early April it was reported the South African government had
terminated its program to develop a space launch vehicle and market
it for the commercial launch market.  Their system, very similar to
the Israeli Jericho and Shavit rockets, was expected to be ready for
its first launch within about 18 months.
   [Commentary:  This proposed new launch system has been the focus
of some intensive behind-the-scenes discussions between several
nations.  As late as the end of March, President de Klerk of South
Africa stated: "We think there is viability with regard to the
satellite program for peaceful purposes and we would like that
program to go ahead."  But the US and other western nations have

been quietly putting  pressure upon the South African government to
stop this venture, working within the framework of the Missile
Technology Control Regime.
   The concern with the a commercial South African launch system was
it could also be used to develop missile technologies and techniques
for a system capable of delivering nuclear devices, or that the
technology could be sold to other nations as the basis for other
missile weapons systems.  Recent reports on the South African
nuclear program had given emphasis to these negotiations. (In later
developments, President de Klerk revealed in related discussions on
the status of the South African nuclear program that the South
African government had completed 6 nuclear weapons, but had since
dismantled them and the production infrastructure for future
weapons).
   Apparently the pressure from the US and other nations had a
significant effect and the South African government stopped
supporting the launch vehicle program.  Denel, a "privatized" arms
manufacturer spun off from the South African 'Armscor' weapons
conglomerate, had been developing the launch system.  As of a
several months ago, they had been looking for a major international
partner to underwrite the system development or provide a sufficient
market base to make the system financially feasible.  They have not
been able to locate such a partner outside of the South African
government.
    When the South African government pulled out, the project is
essentially dead.  Without the deep pockets of the South African
government, and without key customers to make the venture viable, it
becomes too expensive politically and financially to continue in a
highly competitive world market.  At best Denel found partners and
investors from outside South Africa were needed, and under the MTCR
restrictions, it was impossible to obtain a commitment from them.
   This article illustrates some potential pitfalls and problems
with other national launch systems.  Without significant backing
from a national government, purely commercial launch systems will
have a hard time breaking into the world launch market, as they will
have a hard time attracting investors and users, particularly under
the MTCR.]

2- BRAZILIAN LAUNCH TESTS STAGES FOR SPACE LAUNCHER
   On 2 April, the Brazilian government carried out a successful
test of technology being developed  for a small space launcher.  A
VS-40 rocket launched from the Alcantara test site at the Brazilian
military air base at Alcantara carried solar monitoring instruments
to an altitude of 1248 km .  The rocket, flying a high suborbital
trajectory, landed in the Atlantic about 1920 km downrange off the
Brazilian coast near Natal.
   This event was also used by Brazilian president Itamar Franco to
announce his government will create the Brazilian Space Agency.
"The project will be sent to the National Congress, and we will ask
that it be considered urgently" he announced after witnessing the
launch.
   [Commentary:  Brazil is gradually moving towards development of a
small national space launch vehicle, called the VLS (Veiculo
Lancador de Satelites).  The VS-40 was constructed from the S40TM
and S44 motors planned to be used in the third and fourth stages of
the VLS, and this flight was designed to test their performance.
The first and second stages of the VLS are planned to be five S43
motors which were not tested on this flight, presumably as the S43
has been used very successfully in the flight-proven Sonda 4
sounding rocket. The VLS is projected to be capable of placing a 150
kg payload into a 750 km orbit at 25 deg inclination, with a cost
comparative to other small launch vehicles.   Current plans have the
first launch of the VLS in 1995 or 1996, carrying the Brazilian SSR-
1 remote sensing satellite into orbit from Alcantara.
   I'm noting this event of interest to commercial space investors,
as it is another indication of how widely the technology to launch
small payloads is spreading.  There is a proliferation of small
launch systems coming onto the market, and small commercial launch
systems such as IMI, PacAstro, and Pegasus will have to compete with
these small national launchers for market share.
   If the new Brazilian space agency (which I find referenced to
with the acronym of "AEB") is instituted, it will replace the
current Brazilian Commission for Space Activities.  The AEB would
operate under the direction of the Secretariat of Strategic Affairs
and will coordinate and promote space activities in Brazil. This
would presumably be the point of contact for any commercial use or
marketing of the VLS.
   Brazil is also marketing the Alcantara range, just two degrees
south of the Equator, for use by other launch systems.  Payloads
placed into orbit from Alcantara get substantial advantage from the
Earth's rotational velocity and can achieve some propulsion savings
(or payload increases) over other launch sites at higher latitudes.
It is rumored Brazil has approached manufacturers of other small
launch systems to use the Alcantara range -- including Orbital
Sciences and Lockheed/Khrunichev.
   But the use of a Brazilian launch site will be a difficult sell
on the international market.  For example, under the U.S. government
regulations intended to help control the spread of missile
technology (the MTCR), dealings with the VLS launch system are
specifically called out as reason for careful review of any export
licenses from US firms. (The Brazilian Sonda III, Sonda IV, SS-300,
SS-1000, and MB/EE Series Missiles were also specifically identified
in the MTCR regulations).
   These regulations, within the MTCR framework, identify
destinations and projects of concern for missile technology transfer
under Supplement Six of Part 778 of Bureau of Export Administration
rules.  This is not a blanket prohibition of exports, but notes
exporters need to take special care in doing business in certain
regions and countries to avoid participating in or contributing to
missile-related activities, including the identified Brazilian
programs.  Other countries launching from this site would not be
able to launch US satellites or use US components in their systems
or satellites.  This will greatly increase the difficulty of using
Alcantara.
   While it is possible that Brazil could join the MTCR, and agree
to operate under its terms, the government of Brazil has yet to
join.  Use of Alcantara would require a specific ruling, and adds
another obstacle to any such commercial venture.]

3- INMARSAT LOOKS AT GLOBAL PERSONAL COMMUNICATIONS SYSTEMS
   Inmarsat, the International Maritime Satellite organization, is
examining ways to best serve the global hand-held communications
market.  With 67 member countries, Inmarsat currently provides
worldwide maritime, land and aeronautical mobile satellite
communications services, and as part of its Project 21 is looking at
how best to adapt to expected market changes in the next two
decades.  Global personal telecommunications have been identified as
an area in which Inmarsat's market may grow and substantial changes
may occur.
   To examine how Inmarsat may best adapt to the changing market,
contracts have been placed with the communications satellite
industry to assess how Inmarsat can best provide services and to
quantify what market is to be addressed.  Three different global
satellite constellations are being considered for "Inmarsat-P",
including global personal communications systems in geostationary
orbit (GEO), in intermediate circular orbit (ICO), and in low Earth
Orbit (LEO).
   Two contracts have been let for each constellation/ orbit to look
at the size of the handsets or  personal communicators used, the
power requirements needed, and the service capabilities needed in
the satellite system.  Martin Marietta Astro (was GE Astro)/ Matra
Marconi and Hughes/ British Aerospace/ NEC will look at GEO systems.
Matra Marconi/Martin Astro and TRW will look at ICO, and the
Alliance (Aerospatiale/ Alcatel/ Alenia/ DASA) and Antrix will look
at LEO.  Work will be completed by May to review at the Inmarsat
governing council meeting in July.
   [Commentary: The Inmarsat studies are to re-assess the optimal
approach to provide global personal communications.  Over the past
decade other studies have looked at all of these options and come up
with differing answers.
   The current paradigm is LEO constellations can offer the best
services within the constraints of satellite/constellation
manufacture and launch costs, and recurring constellation
maintenance costs.  However this paradigm is dependent upon several
specific assumptions, and most of the LEO constellation solutions
currently proposed focus on providing services to very lucrative
market areas (like the US), or are driven by system funding
constraints.
   In contrast, Inmarsat has access to potentially a large pool of
resources from its member countries and organizations, has already
been granted regulatory approval to provide communications between
numerous individual mobile users, and is chartered to focus on a
global solution rather than for the most lucrative and developed
markets.  This may change the outcome of their studies and change
the preferred approach from a constellation of small LEO satellites.
   A GEO personal communication system would only need only a few
powerful satellites to cover the globe.  In comparison, a system in
lower, intermediate orbits will require a dozen or so satellites at
10-15,000 km distributed over several orbital planes.  And to
provide the same services in LEO could require several hundred small
satellites for continuous global coverage. The key trade off will be
cost of putting up the constellation versus the recurring cost of
maintaining such a constellation.
   The teams looking at GEO systems have the hardest job in defining
such a global system -- they have to operate over the longest
distance and require high power levels, large antennas and highly
sophisticated satellites. But their technology and technical
approaches are well known and they have a wealth of operational
experience.  Hughes is already on record saying they could provide
the equivalent of an Iridium LEO constellation with just 3 large GEO
satellites.  The Hughes/BAe/NEC team and the Martin Astro/ Matra
teams are expected to focus heavily on satellite power requirements,
the GEOsat antenna configurations to receive and differentiate
between many low-powered hand-held sets, and the signal processing
methods to accommodate individual users.
   In the ICO arena, it appears while Martin Astro is leading the
Martin Astro/Matra team for GEO sat systems, Matra is leading the
inverse team for ICO.  They are matched by TRW who has an FCC
application pending for their own "Odyssey" ICO communications
constellation of 12 satellites operating at 10,300 km. I rather
expect TRW's Inmarsat constellation to look a lot like Odyssey.
   LEO systems are a more interesting arena.  On one side there is a
large consortium of European satellite technology houses, matched by
Antrix Corp. Ltd., the corporate front for India's government-
sponsored space industry.  I note no US firms really pursued this
area,  presumably as the majority of their attention is upon the on-
going race to get FCC approval for launch and operation of their own
systems.
   Stepping back from these imminent changes in the market, some
industry analysts place another agenda behind Inmarsat-P.  Inmarsat
is an intriguing operation -- they are the second largest purchaser
of commercial satellites (after Intelsat, another international
telecommunications organization) and have been very proactive in
changing Inmarsat's operations and offerings to best fit into a
rapidly changing marketplace.  Besides the Project 21/ Inmarsat-P
activities, there are recurring rumors Inmarsat is also discussing
possible moves towards privatization.
   The rumors describe two potential options for Inmarsat;
transforming the organization into the majority shareholder in a new
private satellite service provider, or transforming Inmarsat itself
into a private commercial entity.  These rumors have prompted
protests from their competitors claiming Inmarsat is trying to gain
the revenues and profits of a privately held operating firm (above
Inmarsat's current regulated rates and returns as an quasi-
governmental international consortium) while retaining Inmarsat's
regulated position in the international market.
   Such a massive change in Inmarsat's structure is just a rumor,
but if they move towards such a change, and also institute the
Inmarsat-P system, then fledgling US LEO communications companies
might have a much more difficult and limited market to compete in.]

4- INTELSAT LEASES RUSSIAN GEO SATELLITES
   Intelsat announced on 17 March it had entered into an agreement
with InformKosmos of Russia for options to lease up to 3 Express GEO
communications satellites beginning in mid-1994.  Intelsat (the
International Telecommunications Satellite organization) is the
largest user and operator of GEO satellites in the world, operating
19 GEO satellites, and acts as an international non-profit
cooperative of 125 national entities to provide telecommunications
services between 180 countries.
   InformKosmos was established by the Russian government to develop
and market the Express satellite, which is a follow on to the
Gorizont satellite.  Each geosynchronous Express platform will carry
10 C-band 36 MHz transponders and two Ku-band 36 MHz transponders.
   [Commentary:  InformKosmos is a quasi-governmental venture
established by the Russian Federation to design, control,
manufacture, own and finance the Express satellites series.  In 1993
the Russian Republic budgeted about 17 Billion Rubles (about 1/3 of
the total civil space budget) for developing and procuring next
generation communications satellites to upgrade the Russian
Federation's antiquated telecommunications systems.  At least 10 new
Express communications satellites are planned to be bought for, this
program and additional GEO communications satellites and the usage
of the transponders on them are being very actively marketed to
international customers by InformKosmos and NPO PM (Applied
Mechanics).
   Intelsat's use of Russian Express satellites can be interpreted
as a move to acquire additional inexpensive transponder time and to
make a preemptive move to ward off lower-cost competitors for
international telecommunications.  InformKosmos has a major effort
ahead to replace the aging and old-technology ex-Soviet GEO systems
-- yet it has been operating pretty much on a barter-in-kind
financial basis.   Intelsat and other organizations with hard
Western currencies (like Rimsat and InterSputnik, now backed with
German marks -- See CSN/STI No. 18) have obtained very favorable
terms for future GEO satellite option by dealing with InformKosmos.
   This news note is also significant in it establishes a key
precedent -- a Russian enterprise has essentially sold an end-to-end
space system, including Russian launch and Russian hardware, for
hard currency.
   As an interesting side note, for the planned upgrade of the
Russian telecommunications,  InformKosmos is planning to launch 10
of Express GEO satellites plus 4 of an upgraded Express model
(Express-M), plus 5 Gals direct broadcasting satellites with Ku-band
capacity, plus 5 Arkos (GEO) and 4 Maiak (Glonass orbit) satellites
in the Marathon navigation and mobile communications system.  Adding
in the current launches planned for Gorizont C- and K-band
communications satellites and the Ekran direct broadcasting
satellites, this is over 35 launches planned to occur in the next 3-
4 years, all on Proton launch vehicles.  This provides a significant
production run of that launch vehicle, but has prompted other users
to ask rhetorically "Are there any Protons left for commercial
customers?" ]

5- USAF "SPACE LAUNCH GRANTS" TARGET DUAL USE LAUNCH INFRASTRUCTURE
   The US Air Force is offering $10 M in grants to develop new dual
use (DoD and commercial) launch facilities.  According to the 8
April Commerce Business Daily which lists upcoming business
opportunities with the US government,  the USAF will fund up to 75
percent of the total cost of projects designed to improve the US
launch infrastructure,  up to a maximum of $2 M per grant.  Typical
candidate projects for such grants include technical studies of how
new or improved DoD space launch facilities can meet commercial
needs, the design of such facilities, and the construction of or
improvement of facilities within the U.S.
   [Commentary:  Much of the current interest in new US commercial
launch sites has been driven by the expected  availability of these
"space grant" funds.  The USAF had $10 M set aside in the FY 1993
DoD budget for such grants, and this CBD announcement announces the
availability of these funds for interested parties.  I expect it
will be quickly oversubscribed.
   The Space grant program is a follow-on to the "Commercial Space
Competitiveness Act" proposed by Rep. Ralph Hall (D-Texas) and Rep.
Robert Walker (R- Pennsylvania) during last year's Congressional
term.   The act was approved by the House Science, Space, and
Technology Committee last July, but  funding for FY93 was put into
the Defense budget due to near-term budget problems restricting the
amount of funds available.  The responsibility for future grants
will shift to the Department of Transportation's Office of
Commercial Space Transport when funds are appropriated in the
future.
   Space Grants are expected to be pursued by the usual list of
suspects -- Spaceport Florida, the Hawaiian Space Office, the
California Spaceport, a group looking at launching from an offshore
Platform off Alabama, and a group in New Mexico looking at using
White Sands.  Of these proposers, Spaceport Florida is probably the
most well developed -- having proposals on the shelf for specific
launch site improvements to benefit commercial launches.  The
California Spaceport group is looking at improvements to VAFB to
support commercial flights for LEO communications constellations and
has a good chance of getting some grant money if they manage to get
a proposal together in time.  The other groups are looking for study
money to further refine their ideas on how to put in a commercial
launch site.  If the funds are available in the USAF pool, and if
they can show some other financial backing (remember the grants must
be matched 25% from other sources), they might get some grant funds
to continue their efforts. .
   I also expect several new bidders to show up since there is now
real money available.  I'm keeping my ears open, as there ought to
be more data coming out as the grant proposals are filed.]

6- IRIDIUM SIGNS UP INVESTORS FOR LEO CONSTELLATION
   Twenty Japanese firms announced in mid April they were forming a
new joint venture to invest into the Iridium LEO communications
satellite system.  The jointly held firm will be capitalized at 15 B
Yen (US$ 132 M), and includes participation from Sony, Mitsubishi,
Kyocera, and DDI (A long distance Japanese phone carrier) as well as
Motorola.  The exact kinds of services and products to be provided
by the Japanese partners have not been finalized according to
Motorola.
   [Commentary:  Another significant step ahead for Iridium, as they
continue to line up the investors needed to get their venture off
the ground.  I've been following Iridium with particular interest
since it is the most technically advanced LEO constellation being
proposed, the physically largest LEO constellation system proposed
(there's another larger system being discussed, but they haven't yet
filed with the FCC), and since Iridium has been most active in
searching out external financial investors and international
partners.
   Motorola/Iridium has signed up about $800 M in direct investment
for their LEO constellation, which  puts them within striking
distance of their target capitalization.  While the overall
constellation will cost about $3.4 B, Iridium is following a plan
that only requires it to sell about $1.0 B in initial investment
shares, with the remainder to be financed through the debt markets.
The announcement of $138M in Japanese financial backing on top of
the existing commitments should put them in relatively good
financial shape, assuming they get their regulatory problems with a
suitable frequency allocation resolved.
   While the International Telecommunications Union (ITU) has agreed
to allocate a global range of frequencies for such systems as
Iridium, the specific allocation within the US by the FCC has been
tied up in conflict with other LEO constellations.  Iridium desires
to use a Time Division Multiple Access (TDMA) format for their
signal, whereas all of the other ventures proposed for LEO
constellations have requested a Code Division Multiple Access (CDMA)
format.  According to most experts, these two techniques for using
the frequency band are incompatible, and if Iridium is granted
license approval to operate, they will need exclusive access to a
large chunk of the available spectrum.  The other systems claim
their approach  would allow each company to use all of the spectrum
at the same time.
   All of the proposed US LEO constellation firms have been meeting
in a "Negotiated Rule Making Advisory Committee" trying to hammer
out a workable frequency sharing scheme to use.  Unfortunately, they
apparently have deadlocked on how to divide the spectrum and have
not been able to come to an agreement.  Now, the issue is being
handed back to the FCC for a decision that may or may not take into
account each applicants' recommendations.  (This in itself is a
setback, since this is only the second case I can identify where the
FCC gave the applicants a chance to draft their own license
language, instead of the FCC ruling on it alone.  This may
discourage the FCC from trying this approach again in the future.)
   Most importantly, not resolving this issue adds a bit of
financial and technical risk to all of the LEO satellite
constellation schemes since they will have to adapt to the new
regulations when they are issued.  And until the spectrum allocation
is completely resolved specific designs and performance of the
systems cannot be completed and assessed.
   Rules are expected to be issued within a month or so by the FCC,
which may trigger some additional changes in the market.
   As a final note, it is interesting to note the rather broad
response from the Motorola/Iridium offering from Japanese industry.
I had originally seen only reports of about 10 Japanese firms
showing interest in this joint venture, and was rather surprised to
see 20 firms sign on.  Part of the increased interest may be
explained as Motorola has significant market presence in Japan for
wireless communications systems (phones, pagers, etc.), and is
widely recognized as the leader in such services.  There was some
speculation the Japanese partners in Iridium are looking to tap into
the global wireless communications services just appearing, and to
maintain market parity with Motorola and other innovative US
wireless service providers.  If so, a shrewd business move. ]

7- OSC LINES UP FINANCING FOR ORBCOMM
   In related news, Orbital Sciences Corp. (OSC) announced it had
obtained the balance of the financing needed for its Orbcomm global
digital satellite data communications systems.  A MOU (Memorandum of
Understanding) was signed in late April between OSC and Teleglobe
Inc. of Montreal, Canada to provide $80 M for this venture.
   Orbcomm is a proposed system of 26 small LEO satellites to
provide 2-way transfer of short digital messages between inexpensive
pocket-sized communicators.  OSC has carried out the launch of 2
prototype Orbcomm systems, the most recent being orbited as a
piggyback payload on the Pegasus launch of a Brazilian Earth
Observation satellite.
   Under the MOU, Teleglobe will provide $80 M towards the $135 M
total cost of Orbcomm and will operate a new company, ORBCOMM
International Corp., to establish and operate licensee-based Orbcomm
system networks outside the U.S.  OSC will provide the other $55 M
needed and is responsible for operation and control of the satellite
constellation.  OSC is also responsible for marketing Orbcomm in the
U.S. and for obtaining a Federal Communications Commission (FCC)
operating license.  The deal should be finalized in June, and OSC
hopes to receive full FCC approval in the third quarter of 1993.
   [Commentary:  OSC has also been very active in  pursuing
financial and market partners for their LEO constellation.  This MOU
indicates OSC has now lined up all their venture's financial needs,
except final FCC approval.  FCC approval should not be a problem
since the companies proposing "Little LEO" constellations have all
agreed upon an approach to allocate the frequencies needed for their
services - in contrast to the rancor and disharmony between the "Big
LEO" constellation firms.
   These "Little LEO" systems provide limited services compared to
the "Big LEO" systems like Iridium, and do not attempt to provide
full real-time voice and data communications services.  In return,
their costs and complexities are much less.  For example, Orbcomm is
estimated to cost about $135 M versus $3,400 M for Iridium -- which
translates into a projection that Orbcomm only needs about 40,000
subscribers to reach break-even versus 1,000,000 for Iridium.
Furthermore, with a less complex and expensive satellite to build,
Orbcomm expects to rapidly build, launch, and populate their LEO
constellation. Orbcomm expects to be able to operate their
constellation for several years before the "big LEO" constellations
enter the market, giving them a head start in lining up customers.
OSC hopes to have the first 2 Orbcomm satellites in orbit by the end
of this year, with the remaining 24 to be launched in 1994.
   Teleglobe, OSC's primary Orbcomm partner bring some significant
market strengths to the partnership.  Teleglobe is the world's 5th
largest telecommunications provider, and had revenues of over US$ 1
B in 1992.  OSC has been very active in signing up international
partners to sell Orbcomm services and provide Orbcomm data sets, but
Teleglobe will bring added market knowledge and specific skills to
market these services worldwide.]

8- LOCKHEED NOW SELLING SMALL LAUNCH VEHICLE
   Lockheed Corporation announced it is entering the small satellite
launch market in early May as they unveiled plans for a new family
of small launch vehicles designed to launch from  2300 to 8000 lb.
payloads into LEO.  According to Lockheed's announcement, the system
would be available to customers in early 1995.
   Three configurations of the Lockheed Launch Vehicle (LLV) are
planned using different combinations of off-the-shelf solid rocket
motors from Thiokol and United Technologies.  The smallest vehicles,
the LLV1 and LLV2, are combinations of Thiokol's Castor 120 motor
and United Technologies' Orbus 21D.  The LLV3 adds Thiokol's Castor
IV motor as strap-on boosters for additional performance.
   Design work is underway at Lockheed with a team of about 50
engineers, and testing of the structure and electronics is planned
to begin by the end of the year.  An initial demonstration launch is
planned for Nov 1994 from Vandenberg AFB, with  full launch service
available several months later from both Vandenberg and Cape
Canaveral.
   [Commentary: For the past several years, Lockheed has been
examining entry into the smallsat launch market using its own line
of launch vehicles.  Having their own launch system would provide
Lockheed entry into a new part of the space market they are not
currently in (although they build ICBMs and sounding rockets), and
extend their existing product lines to allow them to offer a
complete end-to-end satellite market service from the construction
of a customer's satellite to its delivery on orbit.  Up to now, only
Orbital Sciences Corp. could offer this service, although other
providers such as AeroAstro/PacAstro, and Martin/GE Astro have
considered offering this service.
   Lockheed's initial proposal was for a launch system developed
from converted Poseidon and Trident submarine-launched ICBMs (which
Lockheed builds for the US Navy).  But the uncertain and vague
policy of the US DoD for converting ex-ICBMs into launch vehicles,
as well as unresolved policy problems with converting ICBMs into
commercial launch systems, caused them to shift to design of their
own launch vehicle with off-the-shelf components.
   The LLVs are targeted to fill the niche between the largest
currently available small launch vehicle (Pegasus) and the smallest
currently available commercial medium launch vehicle (Delta).  While
this market is currently not served by any system,  two other launch
vehicles are planned to debut this year, challenging Lockheed's
market entry;  OSC's Taurus rocket, which can launch up to 3,000 lb.
into LEO, and EER Systems' Conestoga rocket, which will lift up to
3,500 lb.   Other proposed systems such as those using converted
ICBMs (for example, the Russian START and SURF systems) could also
compete in this market segment if they find financial and political
backing.
   Lockheed's market plans are to aggressively price the LLV series
to capture two or three launch contracts in the first year of
operations, with the number of annual launches rising after that.
Expected price for the LLV1 will be about $14 M.  For market entry,
Lockheed official say they have two "government funded" customers
targeted for the first LLV flight, but no contracts signed.
Lockheed spokespersons said they are also talking with commercial
entities, including one of the proposed "Big LEO" (low-Earth orbit)
communications satellite constellations as potential customers.
(Considering that Lockheed is building the Iridium satellite,  one
might guess this is Iridium, Inc.)
   This announcement is another sign that Lockheed is very
aggressively moving into the commercial space field -- added to
their recent partnerships with Iridium to build the Iridium
satellites and with Khrunichev in Russia to market the Proton launch
vehicle.  According to published reports, Lockheed's Space Systems
Division wants to double its revenues to $5 B over the next 8 years.
This business area is the most profitable within Lockheed, earning
2/3rds of Lockheed's operating profit last year (about $360 M).  But
most of these revenues have come from defense and NASA space sales.
   Lockheed expects the overall defense market to decline by up to
25% over the next 5 years and substantially impacting their revenues
from their missiles, aircraft and space businesses.  To diversify
outside of defense businesses, Lockheed is looking for other space
businesses to expand into.
   This offering of a new launch system has to be seen as part of a
very conscious, very astute expansion into the commercial space
markets by an experienced and wily competitor. ]

9- COMMERCIALLY DEVELOPED SPACE WAKE SHIELD READIES FOR FLIGHT
   Houston's Space Industries International is hoping to make money
by making the vacuum of space even more rarefied.  With support from
the Space Vacuum Epitaxy Center at the University of Houston (a NASA
sponsored Center for the Commercial Development of Space), SII is
preparing to fly the "Wake Shield Facility" on a Space Shuttle
flight planned for this November.
   The concept behind the Wake Shield Facility is very simple -- by
placing a large disk in orbit, an extremely high and pure vacuum can
be obtained in the "shadow" behind the disk as it sweeps away the
few remaining molecules found in Earth orbit. This environment is
potentially very valuable as semiconducting and superconducting thin
films can be produced with far greater purity than is possible in
even the best vacuums that can be created on Earth.
   The SII Wake Shield Facility spacecraft primarily consists of a
stainless steel disk 12 feet in diameter deployed from the Shuttle.
Once outside of the Shuttle's payload bay, the Wake Shield Facility
uses non-contaminating inert gas thrusters to maneuver about 40
nautical miles away from the orbiter in order to avoid any potential
contamination.  Once in position, the disk's orbital velocity will
create a wake of high vacuum in the wake behind it's steel disk
which is expected to be 10,000 times higher than can be obtained in
ground facilities.
   On the first experimental flight, molecular beam epitaxy
equipment will grow thin film materials with high commercial
potential within the high vacuum and purity volume behind the
shield.  The first payload is designed to grow gallium arsenide thin
films which are of high interest to the electronics industry.  These
will be grown while the facility operates independently from the
shuttle for 2 days before being captured by the Shuttle's remote
manipulator arm and returned to the Earth.
   The current unit is designed for up to 6 flights of up to 3
months duration each, but is planned for only 4 experimental
flights, with the fourth flight planned to produce the first
commercial products. Co-sponsors of the experiment include
Instruments, S.A. Inc., of Edison, N.J.; AT&T Bell Labs, Murray
Hill, N.J., and Schmidt Instruments Inc., Quantum Controls, and
Ionwerks, all of Houston.
   [Commentary:  NASA has been making a push to get more commercial
involvement in space activities.  The NASA CCDS system has proven to
be a spotty mechanism for "jump starting" commercial activities, but
several cooperative ventures are in work which might produce viable
commercial products.  The Wake Shield is one - exploiting a unique
feature of the space environment to examine if a commercial product
can be developed.
   There seems to a real promise to use microgravity and a high
purity space environment for production of thin film gallium
arsenide chips.  Current terrestrial production runs are plagued
with low yield and defects which limit the operability of the GaAs-
based electronic devices.  But before any new product can be sold,
the process and the capabilities of the product have to be
demonstrated in some way.
   Here, NASA is providing financial backing through the CCDS system
sufficient to manufacture the Wake Shield spacecraft and to fly it
on the space shuttle.  In my opinion, this is a reasonable use of
NASA's commercial space money in providing seed money to test a
promising new technique with potential commercial applications.  If
the GaAs production experiments don't pan out, this technique might
be applicable to other products - making the investment in the Wake
Shield experiment facility a reasonable one for limited experiments.
And quite rightly, NASA has not committed to continuing to back this
venture if it is not proven viable through outside commercial
contracts.
   As with many of the previous Materials Processing in Space (MPS)
activities, the market for which this venture is targeted keeps
moving.  There might be enough market for high performance specialty
electronics substrates such that commercial viability at a
reasonable level might be sustained.  The initial Wake Shield
experiments should prove out the performance of the system and the
basic parameters necessary to estimate if a commercially valuable
product can be produced.  But until the technology and products are
proven out in the marketplace, I will remain rather skeptical about
its commercial potential.]

10- OTHER NASA SUPPORTED COMMERCIAL VENTURES ENCOUNTER PROBLEMS
   Two other NASA-supported commercial ventures, COMET and Spacehab,
have run into problems.
   The Commercial Experiment Transporter (COMET), designed to
provide a commercial means of sustaining and recovering commercial
orbital payloads, has run into financial and technical problems.  It
now appears the first COMET mission planned for May has been
postponed indefinitely until contractual and financial issues in the
program are resolved.
   The most serious of the COMET program's problems is ballooning
costs.  COMET's cost was originally set at $85.1M including three
launches as it was funded through the NASA Center for the Commercial
Development of Space (CCDS) at the University of Tennessee's Calspan
Center for Space Transportation and Applied Research (C-STAR).
However, expected program costs have increased to about $ 120 M, and
the program is currently over its available budget by $5.5 M.
Another $13 M is needed just to support its first flight even with
the schedule slipped to a June launch.
   These financial problems arise from a variety of factors
including technical problems encountered during testing of the
systems.  Since the budget available has been exceeded, the COMET
team firms have not been able to continue, and Westinghouse Corp.
and Space Industries International (SII) have stopped work on the
program.  At present, there is no future launch date.
   Another NASA-backed commercial venture, Spacehab, has also
encountered problems.  While Spacehab has not had cost overruns or
schedule slippage, the commercial program to develop a pressurized
module with additional experiment volume for the Space Shuttle has
had problems attracting commercial customers.
   Under the terms of the Spacehab contract with NASA, NASA agreed
to lease at least 200 of the 300 payload experiment lockers
available on the first 6 Spacehab flights.  The remaining 100+
lockers were to be marketed by Spacehab to commercial and
international customers for orbital experiments at about $ 1.8 M per
locker.  Unfortunately, only 26 lockers have been reserved to date,
with 24 going to a single customer, Intospace, the Germany materials
processing consortium.
   [Commentary:  Rumors about problems with these two commercial
ventures have been cropping up with more and more frequency over the
past several months.  Of the two ventures, Spacehab seems to be in
the best shape.  The problem, of course, is if Spacehab does not
come reasonably close to selling out their remaining volume they
will not be able to show their program is a financial success.
   NASA's commitment to lease 2/3 of the available lockers allowed
Spacehab to design and produce their module, secured by NASA's core
tenancy.  But Spacehab must sell out most of the remaining lockers
to demonstrate product feasibility and make their cost/return
projections.
   If Spacehab does not sell out the lockers, the venture won't fold
immediately -- they should have enough money left to continue to
market their product and support it for several more years.  But
they will have problems meeting some cash flow needs as the 1/3 of
the funds on the project were dependent on non-NASA sales.
Hopefully a successful first flight will spark more interest in
their product.  It's currently planned for STS-57 in June of this
year.
   COMET is a somewhat different story.  $33 M in overruns on a $85
M dollar project is substantial.  Furthermore, while NASA is being
approached to cough up these dollars, NASA is feeling uncomfortable
since under the commercial contracts used NASA doesn't have the data
to know how far the contractors are along on the program, and
doesn't have any assurance the dollars they provide will solve the
program's problems.
   Since NASA's CCDS is acting like a venture capitalist on the
COMET project it wants to quickly review of the status of the COMET
program to determine if the dollars requested and the planned
actions by the COMET team will solve the problems encountered.  In a
similar situation a venture capital organization would do the same,
excepting the private VC outfit would hire outside experts
(consultants) to wire-brush the venture, but here the NASA CCDS is
planning to other NASA centers for the experts.  In my opinion, the
CCDS should consider also going to outside experts who would have a
perspective outside of the standard NASA culture to best review a
commercial program being run in a non-NASA culture.
   My expectation is the problems with COMET will be found to be
identified, and in another month or so NASA will recommend
continuing with the venture through at least the first flight.  NASA
will have to scrape around in their OACT budget to find enough funds
to get the first COMET launch off sometime this year (perhaps
September?), but will find enough to fund the first flight, holding
any remaining funds needed until FY 94 and a flight to show the
current problems have been resolved.
   COMET's marketing efforts to attract new customers are being hurt
by these financial problems and the delayed launch -- particularly
as this program was billed as providing cheap and simple access to
space for commercial researchers.  WESTAR, the commercial version of
COMET, is still looking for outside customers and while Westinghouse
has stopped work on COMET, they may be continuing a low level of
effort to market WESTAR.  I have heard some rumors of some folks
being interested in future flights but I have seen no notification
that any significant customers have signed up.  I also note WESTAR
is talking with Arianespace to launch the WESTAR orbital and
recovery modules piggyback on Ariane polar launches.
   Problems with COMET also delay the first launch of the Conestoga
launch vehicle.  This has been in the news recently as it is the
Conestoga vehicle which will carry the advertisements for Arnold
Schwarzenegger's new movie "The Last Action Hero".  Columbia
Pictures is still planning to put the ads on the upcoming launch,
even though this occurs after the mid-June premiere of the movie.
Columbia will use a later launch to help publicize the release of
the picture in markets outside of the US and in preparation for home
video release in late 1993.
   In a related note, Dr. Carole Lieberman, chairperson of the
National Coalition On Television Violence, has vowed to push to
remove the advertising from the Conestoga launch.  In a recent press
release she charges the ad represents "an unprecedented
glorification of media violence."  She is quoted as saying "Is
nothing sacred anymore? Has the space program -- which was the pride
of our nation -- become nothing more than an example of
commercialization run amok, just to further the glamorization of
primitive violence?".  The impact of this on the Conestoga launch is
not known.]

11- AEROSPACE FIRMS PLAN JOINT STUDY OF COMMERCIAL SPACE MARKET
   In a surprise announcement on 5 May Dan Goldin revealed 5 major
aerospace firms were banding together to study the commercial space
market.  Speaking at the AIAA national convention, the NASA
Administrator said the eventual goal of this activity could be the
development of a new launch system to best serve the commercial
space market in the next decade.
   Reports in the Wall Street Journal and the trade press identify
the firms involved as Boeing, General Dynamics, Lockheed, Martin
Marietta and Rockwell.
   [Commentary:  Little data has been released on this new activity.
I'm noting it here as it could be the start of a significant new
commercial launch system.
   From the little data publicly released by participants, the
initial effort would focus upon a study of where future commercial

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End of Space Digest Volume 16 : Issue 643
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