"Factors Affecting U.S. Commercial Space Launch Industry Competitiveness"

The U.S. commercial launch industry began in earnest in 1986, after the U.S. Government changed its launch policy in response to the Challenger accident. This policy change sought to encourage, facilitate, and coordinate the development of commercial expendable launch vehicle operations by U.S. firms, and took NASA's Space Shuttle out of the competition for commercial and foreign spacecraft payloads.

The policy change set in motion numerous agency actions aimed at implementing these objectives. Yet, despite subsequent policy statements and implementing actions aimed at improving their ability to compete, U.S. launch firms have failed to secure a leadership position in the commercial market. This paper explores the reasons why U.S. commercial launch firms were not more successful between 1986 and 1992, the earliest years of the commercial launch industry. It addresses the question of how implementation of the U.S. Government's commercial space launch policy has affected the U.S. industry's abilities to compete.

This paper briefly describes the historical background of the commercial space launch industry; executive and legislative policy directives, guidelines, and implementing actions; the roles, stakes, resources, and actions of policy decision making and implementing agencies; and the U.S. launch firms, international competitors, and communications satellite firms that were their customers. It assesses the effectiveness of the U.S. commercial space launch policy's implementation and offers insight into the impact of policy implementation and other factors on the abilities of U.S. firms to compete.

The paper concludes that policy implementing actions both helped and hindered the U.S. commercial space launch industry's ability to compete. However, the overall competitiveness of U.S. commercial launch firms may not have improved even if policy had been implemented more effectively. The policy design was flawed from the start; it implied that the U.S. Government could influence behaviors of actors and outcomes of events that were beyond its control. The ability of firms to compete ultimately depends on decisions made by the firm, its customers, and its competitors, as well as on the policy implementation actions of the Government.