X-33 aircraft

"The Commercial Launch Industry, Technological Change, and Government-Industry Relations"

Andrew J. Butrica

On October 31, 1997, NASA announced that the X-33 Program had just successfully completed its five-day-long Critical Design Review. The X-33 is a technology demonstrator for NASA's "next generation" of space launch vehicle. It will flight test a range of technologies needed for single-stage-to-orbit reusable launch vehicles, such as thermal protection systems, composite cryogenic fuel tanks, and the aerospike engine. Test flights are now scheduled to begin in July 1999. Eventually, based on the X-33 experience shared with NASA, Lockheed Martin may build a commercial single-stage-to-orbit reusable launch vehicle, called VentureStar. NASA also is working with Orbital Sciences Corporation to design, build, and test fly an experimental two-stage reusable launch vehicle called the X-34.

Additional reusable space vehicles are under development by a number of private firms, including Kelly Space Technology, the Kistler Aerospace Corporation, Pioneer Rocket, and the Rotary Rocket Company. No list would be complete, though, without mention of the pioneering DC-X, built by McDonnell Douglas Aerospace for the Strategic Defense Initiative Office, and flight tested between August 1993 and July 1995, before being reborn as a NASA vehicle, the DC-XA, and performing additional test flights between May and July of 1996.

All of these vehicles were or are intended eventually for the commercial launch market. The ever growing commercial demand for launchers, and the relatively high cost of placing payloads in space, have driven the search for new, less expensive launch vehicles utilizing the latest technologies. However, the use of new, untried launch systems, and the technical difficulties associated with reentry vehicles, pose high risks for those attempting to create a niche in the commercial launch market by utilizing new technologies. A case in point is the COMET program.

COMET was a NASA program intended to boost the fledgling microgravity industry. Part of the COMET spacecraft was a reusable reentry module. It was to be put into space by a completely new type of launcher. Thus, like the current generation of reusable launchers, COMET combined reusability and a novel launch system in order to address the needs of industry. By examining the example of COMET, we will see the complexities and difficulties inherent in introducing new launchers, as well as reusable vehicles, into the commercial market.

COMET stood for COMmercial Experiment Transporter. In May 1990, the Center for Space Transportation and Applied Research (CSTAR), at the University of Tennessee in Tullahoma, a university entity operating as a NASA Commercial Center for the Development of Space (CCDS), proposed COMET to the NASA Office of Commercial Programs. CSTAR proposed to procure three COMET missions for NASA for about $85 million spread over five years. The focus of the COMET program was on jump-starting the incipient space-based materials processing industry. The COMET spacecraft would carry microgravity experiments into low earth orbit for a month, then parachute test samples back to Earth in a reusable, recoverable module. Another portion of the spacecraft, the service module, would be left in orbit for two to four years. Rides on the COMET promised to be longer and better than those aboard either the Space Shuttle or a sounding rocket.

CSTAR's role in the COMET program was to provide general oversight. The prime contractors for COMET were the Space Division of Westinghouse Electric Corporation, in Baltimore, which supplied the service module; Space Industries Inc. of League City, Texas, which provided the recovery module; and EER Systems Corp. of Vienna, Va., which furnished the Conestoga launch vehicle. Space Industry, Inc., also was to contribute payload integration, orbital operations, and the recovery system. Westinghouse's Commercial & Civil Space Department was hoping to sell COMET services to commercial customers under the business name Westinghouse Space Transportation and Recovery (Westar).

The Conestoga rocket was a new launch vehicle, and the launching of COMET would mark its debut. While employed by Space Services Inc. (SSI) of Houston, Texas, Donald K. "Deke" Slayton, one of the original seven Gemini astronauts, thought up the concept of a multiple-stage rocket consisting of a core motor with additional motors strapped around it, the number of additional motors depending on the size of the payload. This was the Conestoga rocket. When EER bought SSI, they acquired the Conestoga design, as well as Deke Slayton, who came to EER as Director of the Space Services Division.

It did not take long before it became obvious to NASA that the COMET program was in trouble, and as early as February 1992, COMET problems aired in the press following a major design review completed January 22, 1992. One serious problem was a launch delay arising from the late delivery of rocket motors by the Thiokol Corporation of Ogden, Utah. NASA, however, felt that the problems went deeper. CSTAR was not performing competently as project manager, incapable of handling such a complex engineering effort and causing repeated schedule delays. NASA further was troubled by the project's mushrooming costs, which had ballooned to an estimated $158 million for three missions. As a result, COMET was reduced from a three-mission to a single-mission program with a budget of $65.8 million, instead of $85 million for three missions. By January, 1994, the relationship between NASA and CSTAR had reached bottom, as NASA announced plans to phase out CSTAR and five other Commercial Centers for the Development of Space. The termination of CSTAR raised several major questions about COMET's future, especially who would run the COMET program.

At the same time, NASA ordered an extensive independent review of the COMET program. The review examined financial, technical, and schedule problems and was to be completed in early February, 1994. As the review was taking place, Congress intervened. On January 14, 1994, the heads of the House and Senate appropriations committees, Sen. Barbara Mikulski (D-Md.) and Rep. Louis Stokes (D-Ohio), directed NASA to release $7.2 million in the COMET budget, but only if the program successfully completed the independent review. NASA's review of the COMET program continued into April, 1994.

On May 5, 1994, with the results of the independent review in hand, Daniel Goldin, NASA Administrator, announced that the space agency would refuse to continue funding COMET. The independent review team had concluded that the COMET recovery vehicle would have had a greater probability of success if it had been built using regular NASA procurement and management practices, instead of through a grant to CSTAR. Moreover, the program created a serious liability problem for CSTAR and its contractors, as well as for NASA, in the event that the recovery module landed outside the safe area of the Utah Test and Training Range in Utah's sparsely populated Great Salt Lake desert. As one anonymous congressional staffer commented to a Space News reporter, "It sounds like it [COMET] has a massive cost overrun, there is no commercial market [for it] and NASA doesn't need it. I don't think anyone is going to try and save it."

Despite Goldin's announcement, COMET was not dead. Congress brought it back to life. CSTAR COMET program managers convinced Sen. Mikulski and Rep. Stokes that NASA should release COMET funding on condition that the contractors agree to waive NASA's legal liability. In a letter dated June 10, 1994, Mikulski and Stokes requested that NASA release all COMET funding. NASA agreed, but attached certain strings laid out in a letter to COMET contractors dated July 18, 1994. NASA wanted CSTAR out of the COMET program, and asked the three contractors to enter into a fixed-price contract with NASA for the first launch in exchange for the release of the remaining $14 million in funding. In addition, NASA asked the contractors to accept legal liability for the reentry vehicle.

The immediate reaction of COMET contractors was that such major changes so late in the program could kill the enterprise. EER Systems viewed NASA's proposal to change its relationship with the contractors as an unnecessary complicating factor that could drag the process out for months. Neither a consortium nor a joint venture arrangement, as proposed by NASA, were satisfactory to the contractors.

NASA officials met with representatives of the three COMET contractors on August 5, 1994, to attempt a resolution of outstanding questions and to resurrect the program. NASA now removed the biggest roadblock to agreement by agreeing to drop the agency's demand for a new contract with the three-company team. Neither Westinghouse nor Space Industries was interested in pursuing the project further. After long discussions stretching over the final months of 1994, on March 28, 1995, NASA signed a sole-source, firm fixed-price contract with a single party, EER Systems.

Unlike the other COMET contractors, EER Systems saw COMET as a great opportunity, an opportunity to make lemonade out of lemons. Since its acquisition of SII and the Conestoga rocket design, EER had been looking for payloads to launch. The firm landed a five-launch contract with the Strategic Defense Initiative Office (now the Ballistic Missile Defense Organization) to place segments of the so-called Star Wars space defense system in orbit at low cost. However, when the President and Congress killed the Star Wars program and changed that agency's agency, the Conestoga lost that customer. The COMET program, then, appeared as a way to provide Conestoga with its first payload. Once the Conestoga launcher was proven, customers would be easier to find.

As part of its deal with NASA, EER would find commercial payloads for the first COMET launch, which was now scheduled for May 29, 1995. EER also announced, in early January, 1995, that they had secured five firm commercial payloads for the first COMET flight, and they were negotiating with customers for space on a second COMET mission, COMET 2, scheduled for launch in 1996.

Also key to EER's management of the COMET program was the decision, made at NASA's suggestion, to change the COMET landing site from Utah to the Atlantic Ocean. This change reduced the reentry liability risk immensely, and facilitated the process of obtaining a launch license from the Department of Transportation. Ultimately, however, the Department of Transportation did not issue its launch approval until 72 hours before schedule launch on August 4, 1995.

Launching the Conestoga on schedule was another problem. The inability to establish a firm launch date hindered EER's efforts to line up customers. In their quest for commercial payloads, EER discovered that customers' chief requirement was the ability to launch on demand. The Conestoga was not fated to launch according to schedule. Like so many other COMET launch dates, the August 4, 1995, launch was postponed to August 12th, when high winds over the Wallops Island launch site again delayed the launch until the following day. Then, two of the CASTOR solid-rocket Thiokol engines malfunctioned just one minute and 38 seconds before launch.

Although NASA announced a new launch date, October 20, 1995, the first Conestoga launch, with the COMET spacecraft onboard, did not take place until three days later, on October 23, 1995. The picture perfect lift-off seemed to assure the success of the Conestoga launcher and the COMET spacecraft. However, just 46 seconds after lift-off, the Conestoga broke into pieces 23 kilometers off the Virginia coast at an altitude of 10 kilometers. That one launch failure marked the end of both COMET and the Conestoga. EER was out of the launch business, and abandoned selling space on future COMET missions.

We will never know how successful, technologically or financially, the COMET reentry module would have been. That is in the nature of failures. What is clear, though, is the exceedingly difficult and risky nature of using new technologies to serve the commercial market, whether those new technologies are reusable reentry vehicles, like the COMET spacecraft, or new launch systems, like the Conestoga. But the lessons of COMET and Conestoga reach beyond the commercial launch market to the policy world.

The failure of CSTAR to adequately manage the COMET program raises serious questions about the role of universities in the commercialization of space, or at least as managers of programs that involve complex engineering processes. Also, programs need single individuals, not academic committees, to take responsibility for program progress and budget.

The conduct of the COMET program also raises questions about the relations between government (specifically NASA) and industry. NASA played the vital role of creating and funding the program in order to foster the nation's nascent microgravity industry. Here would appear to be an argument in favor of government support and even guidance of industry. However, NASA did not carry the program to fruition, that is, turn COMET into a real commercial venture. That task ultimately fell to industry itself, in the form of EER. In the end, it would appear that NASA's (government's) crucial role was to supply the venture capital money for the project. Industry did what it does best: attempt to turn a profit, but lining up paying customers. Being handed lemons can be a powerful motivating force.


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