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THE COMMERCIAL SPACE LAUNCH INDUSTRY: 

SMALL SATELLITE OPPORTUNITIES AND 

CHALLENGES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON SPACE 

COMMITTEE ON SCIENCE, SPACE, AND 

TECHNOLOGY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

April 19, 2016 

Serial No. 114–73 

Printed for the use of the Committee on Science, Space, and Technology 

( 

Available via the World Wide Web: http://science.house.gov 
(II) 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

HON. LAMAR S. SMITH, Texas, Chair 

FRANK D. LUCAS, Oklahoma 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

DANA ROHRABACHER, California 

RANDY NEUGEBAUER, Texas 

MICHAEL T. MCCAUL, Texas 

MO BROOKS, Alabama 

RANDY HULTGREN, Illinois 

BILL POSEY, Florida 

THOMAS MASSIE, Kentucky 

JIM BRIDENSTINE, Oklahoma 

RANDY K. WEBER, Texas 

BILL JOHNSON, Ohio 

JOHN R. MOOLENAAR, Michigan 

STEPHEN KNIGHT, California 

BRIAN BABIN, Texas 

BRUCE WESTERMAN, Arkansas 

BARBARA COMSTOCK, Virginia 

GARY PALMER, Alabama 

BARRY LOUDERMILK, Georgia 

RALPH LEE ABRAHAM, Louisiana 

DRAIN LAHOOD, Illinois 

EDDIE BERNICE JOHNSON, Texas 

ZOE LOFGREN, California 

DANIEL LIPINSKI, Illinois 

DONNA F. EDWARDS, Maryland 

SUZANNE BONAMICI, Oregon 

ERIC SWALWELL, California 

ALAN GRAYSON, Florida 

AMI BERA, California 

ELIZABETH H. ESTY, Connecticut 

MARC A. VEASEY, Texas 

KATHERINE M. CLARK, Massachusetts 

DONALD S. BEYER, JR., Virginia 

ED PERLMUTTER, Colorado 

PAUL TONKO, New York 

MARK TAKANO, California 

BILL FOSTER, Illinois 

SUBCOMMITTEE ON SPACE

HON. BRIAN BABIN, Texas, Chair 

DANA ROHRABACHER, California 

FRANK D. LUCAS, Oklahoma 

MICHAEL T. MCCAUL, Texas 

MO BROOKS, Alabama 

BILL POSEY, Florida 

JIM BRIDENSTINE, Oklahoma 

BILL JOHNSON, Ohio 

STEVE KNIGHT, California 

LAMAR S. SMITH, Texas 

DONNA F. EDWARDS, Maryland 

AMI BERA, California 

ZOE LOFGREN, California 

ED PERLMUTTER, Colorado 

MARC A. VEASEY, Texas 

DONALD S. BEYER, JR., Virginia 

EDDIE BERNICE JOHNSON, Texas 
(III) 

C O N T E N T S 

April 19, 2016 

Page 

Witness List ............................................................................................................. 2 

Hearing Charter ...................................................................................................... 3 

Opening Statements 

Statement by Representative Brian Babin, Chairman, Subcommittee on 

Space, Committee on Science, Space, and Technology, U.S. House of Representatives ........................................................................................................... 20 

Written Statement ............................................................................................ 23 

Statement by Representative Marc A. Veasey, Subcommittee on Space, Committee on Science, Space, and Technology, U.S. House of Representatives .... 25 

Written Statement ............................................................................................ 27 

Witnesses: 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

Oral Statement ................................................................................................. 32 

Written Statement ............................................................................................ 35 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation (CSF) 

Oral Statement ................................................................................................. 42 

Written Statement ............................................................................................ 44 

Discussion ................................................................................................................. 55 

Appendix I: Answers to Post-Hearing Questions 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation .......................... 72 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation (CSF) .......... 91 

Appendix II: Additional Material for the Record 

Statement submitted by Representative Eddie Bernice Johnson, Ranking 

Member, Committee on Science, Space, and Technology, U.S. House of 

Representatives .................................................................................................... 122 

(1) 

THE COMMERCIAL SPACE LAUNCH 

INDUSTRY: 

SMALL SATELLITE OPPORTUNITIES AND 

CHALLENGES 

TUESDAY, APRIL 19, 2016 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON SPACE

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY, 

Washington, D.C. 

The Subcommittee met, pursuant to call, at 10:02 a.m., in Room 

2318 of the Rayburn House Office Building, Hon. Brian Babin 

[Chairman of the Subcommittee] presiding. 
2 

li\MP,R S SMITH. fcxas 

CHAIBMfiN 

\tongress of the CJ!inited ~tates 

il'lousc of 'Rcprcscnmtiucs COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

2321 RAYBURN HOUSE OFFICE BUILDING 

WASHINGTON, DC 20515-6301 

1202) 225-6371 www.science.house.gov 

EDDIE BERNICE JOHNSON, fexas 

RANKING MEMBER 

The Commercial Space Launch Industry: Small Satellite 

Opportunities and Challenges 

Tuesday, Apri119, 2016 

10:00 a.m. 

2318 Rayburn House Office Building 

Witness 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

Mr. Eric StaHmer, President, Commercial Spaceflight Federation (CSF) 
3 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

HEARING CHARTER 

Tuesday, April19, 2016 

10:00 a.m. 

2318 Rayburn House Office Building 

The Subcommittee on Space will hold a hearing titled The Commercial Space Launch Industry: 

Small Satellite Opportunities and Challenges on Tuesday, April 19, 2016, at I 0:00a.m. in Room 

2318 Rayburn House Office Building. The purpose of this hearing is to examine the current 

state of the small satellite commercial launch industry. 

Witnesses 

• Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

• Mr. Eric Stallmcr, President, Commercial Spaceflight Federation (CSF) 

Background 

Origins of the U.S. Commercial Space Launch lndustri 

Between 1963 and 1982, U.S. expendable launch vehicle (ELV) manufacturers produced 

vehicles only under contract to the National Aeronautics and Space Administration 

(NASA) or the Department of Defense (DOD). In the early 1970s, when private 

companies and foreign governments purchased communications satellites, they had to 

contract with NASA to launch their payloads. Through NASA, launches could be 

procured on any one offour ELVs: Titan, built by Martin Marietta; Atlas, built by 

General Dynamics; Delta, built by McDonnell Douglas; and Scout, built by LTV 

Aerospace Corporation. NASA would purchase a launch vehicle through traditional 

government procurement practices, and the launch would be conducted by a privatesector contractor under NASA supervision. The U.S. government essentially served as 

the only provider of space launch services to the Western world. Seeing an opportunity 

to provide launch services, the European Space Agency developed its own ELV, Ariane, 

which became the first competitor to NASA for commercia/launches. The first Ariane 

1 Origins of the Commercial Space lndusl!y. It can be accessed at: 

hur;~\\.\\~YJ"i!.~t,g_~)~~hS!JJLIJ.i.~ts)n .. m)_l_~s.tQ!l~~J1l?Ji}_t't(~<lnJl!Jfr~@L)Jl~C_l!ldustrv.p_Qf (Last Accessed on March 31 s\ 

2016). 
4 

launch occurred in 1979, and in 1984, a private company, Arianespace, took over 

commercial operation of the vehicle. 2 

In the late 1970s, the U.S. government decided to phase out all ELVs, except Scout, in 

Javor of the U.S. space shu/1/e. The shullle would take all U.S. government satellites, as 

well as commercial satellites, into orbit. NASA declared the shuttle, which made its first 

flight in 1981, operational in 1982, and governmentfimding ofELV production ceased 

in 1983. It quickly became evident, however, that the flight schedule of the shuttle could 

not meet all of the U.S. security, civil, and commercia/launch requirements 3 As the 

need grew for more launches than NASA could handle, some launch vehicle 

manufacturers expressed interest in offering commercial launch services. In 1982, the 

first successful private launch in the United States took place -a test launch of the 

Space Services' prototype Conestoga rocket. The procedures required to gain approval 

fi!r that launch, however, proved time-consuming and led to the introduction of 

legislalion to make it easier/or companies to pursue commercia/launch activities. A bill 

(l!R 1011) introduced in the !louse by Congressman Daniel Akaka (D-HI) would have 

designated the Department of Commerce as lead agency, while the Senate bill (S 560), 

introduced by Ernest "Fritz" Hollings (D-SC'), intended to give the lead role to the 

Federal Aviation Administration (FAA). Others suggested the lead go to the Department 

of State or NASA. While Congress debated the efficacy of its legislation, on July 4, 1982, 

President Ronald Reagan issued national security decision directive (NSDD) 42, 

"National Space Policy, "stating that expansion of US. private sector involvement in 

civil space activities was a national goal. 4 

On May 16, 1983, the President issued NSDD 94, "Commercialization of Expendable 

Launch Vehicles. " This stated the "U.S. Government fully endorses and will facilitate 

the commercialization of U.S. Expendable Launch Vehicles. The U.S. Government will 

license, supervise, and/or regulate U.S. commercial ELV operations only to the extent 

required to meet its national and international obligations and to ensure public safety. " 

Congress affirmed and expanded these actions through the Commercial Space Launch 

Act, enacted on October 30, I 984. This legislation addressed three substantive areas: 

licensing and regulation; liability insurance requirements; and access of private launch 

companies to governmentfGcililies."5 

'For more information on the development of the early commercial launch market, consult the 1992 Vice 

President's Space Advisory Board's report on "The Future of the U.S. Space Industrial Base." Part one is 

available here: Part two is available here: 

Accessed on March 31 ", 20 16). 

During time, was objection to what was seen as a NASA monopoly on the commercial 

launch market. For more see the June 20, 1984 paper by Milton "The Perils of a NASA 

published by the Heritage Foundation. Retrieved at: !ill:iL..'.'~'I.'llls;I!li.l£.\'.c2IR-c.\:O;:i!IJ'lLL92!lrJ;,J . .YJi:L\i'!!__t!.l<'::Q.<;!J.i.:od'J:: 

\'--:'1~l::'Jll!"£.1l]QilQJ2lli.\. (Last Accessed on April4'h, 2016). 

For more on the "National Space Policy" consult NASA's fact sheet "'Presidential Directive on 

National Space Policy,' February II, 1988." It can be found through the NASA History Office at: 

lJ.lli2.:~_\\ \\ l~~:JJ~JllijiL@} __ .Qlfl£.\:?Jlli.2lJistorv po!icv88_html 5 A copy of the Commercial Space Launch Act (P.L. 98-575) can be found at: 

Il11.Jli_~~-~-gp_o.!!ov_JQ.?\S pka. STYrL' J'L---98 'pdf STAll' r1>98-Pg305illiit'. 

2 
5 

State of the Commercial Space Launch Industry Today 

Since the passage of the Commercial Space Launch Act (P.L. 98-575) in 1984, global 

commercial space launch services are estimated to account for about $6 billion in annual 

revenue. 6 Most of this launch activity is presumed captive; that is, the most payload operators 

have existing agreements with launch service providers or do not otherwise "shop around" for a 

launch.7 About a third of this $6 billion represents internationally competed, or commercial, 

transactions 8 In 2014, U.S. launch service providers accounted for about $2.4 billion in total 

revenues or 41 percent of global launch services.9 In 2014, the FAA Office of Commercial Space 

Transportation licensed launches accounted for $617 million of the $2.4 billion. 10 Globally, the 

commercial space launch industry revenue is experiencing growth, estimated at 9 percent growth 

in 20!5 as compared to 2014, in part due to higher numbers of European and U.S.Iaunches of 

commercial satellites. 11 

NASA's Relationship with the Commercial Space Launch Industry 

NASA's Launch Services Program 

The Launch Services Program (LSP) was established at Kennedy Space Center for NASA's 

acquisition and program management of expendable launch vehicle (EL V) missions. The 

principal objectives of the LSP are to provide safe, reliable, cost-effective and on schedule 

launch services for NASA and NASA-sponsored payloads seeking launch on ELVs. 12 The 

Launch Services Program is responsible for NASA oversight of the launch service including 

launch vehicle engineering and manufacturing, launch operations and countdown management, 

and providing added quality and mission assurance in lieu of the requirement for the launch 

service provider to obtain a commercial launch license. Since 1990, NASA has purchased EL V 

launch services directly from commercial providers for its missions. In September 20 I 0, 

NASA's Launch Services (NLS) contract was extended by the agency for 10 years, through 

2020, with the award of four indefinite delivery/indefinite quantity contracts to United Launch 

Alliance (ULA), Space Exploration Technologies (S~aceX), Orbital Sciences Corporation (now 

Orbital A TK), and Lockheed Martin Space Systems. 3 

Part of LSP's duties include managing the Venture Class Launch Services (VCLS) contracts. 

NASA's Venture class missions are small- to medium-sized missions that can be designed, built, 

6 Federal Aviation Administration, "The Annual Compendium of Commercial Space Tracnsr>ortatirm 

20 !6. Retrieved at '.U.'l""--"-'•=cl.cle~.'-"''"~-'£c.'! .. '.'"""-'~-"'£''"'"'''" .'.c-'-''-'"~'"'-'"!..!'""·""'-='"'-~C!11L'"'"!.!.'!.!.'£\!.!.· 'Ibid., l. 8 Ibid .. I. 

g Ibid .. 9. 

"'Ibid .. I. 11 Satellite Industry Association, "2015 State of the Satellite Industry Report." September 2015. Retrieved at: 

!."c'l"'--'7'-~:uu.'~' "--"'J•'""-"'-"-"L'""''c'.W-"-".''-L'-""'~'-'~"'-'£''-'2=""-'~'..J...-'.DJ.,::.'...'="'-""""'"-"""' (Last Accessed on . 2016). 

fact sheet, "NASA's Launch Services Program." Retrieved at: 

h.!JJh_ \\\\ w .nasa.gov site~ default.Jllcs:fi!c:-. ·LSP tact sheet !\;ov20 ll.pdt' 13 NASA fact sheet, "NASA's Launch Services Program." Retrieved at: 

J.llip: W\\\\.nnsa.no'.:...£.i.!t;_~!.£i~tult files·llks LSP bchhect "\i<w201l.pdf. 

3 
6 

and launched in a short period of time. NASA explains the VCLS contract as "a Firm-Fixed 

Price contract for a dedicated launch service for U-Ciass satellites with NASA having sole 

responsibility for the payload on the launch vehicle. NASA's LSP supports the CubeSat Launch 

Initiative (CSLI) by providing launch opportunities for CubeSats that are currently on the 

manifest back log." 1 

For example, in October 2015, the LSP awarded multiple VCLS contracts to provide small 

satellites (also called SmallSats, CubeSats, microsats and nanosatellites) access to low-Earth 

orbit. The launch-provider companies and the value of their NASA contracts are listed below: 

• Firefly Space Systems Inc. of Cedar Park, Texas, $5.5 million 

• Rocket Lab USA Inc. of Los Angeles, California, $6.9 million 

• Virgin Galactic LLC of Long Beach, California, $4.7 million 

According to NASA, "LSP is attempting to foster commercial launch services dedicated to 

transporting smaller payloads into orbit as an alternative to the rideshare approach and to 

promote the continued development of the U.S. commercial space transportation industry ... 

VCLS is intended to help open the door for future dedicated opportunities to launch CubeSats 

and other small satellites and science missions." 15 

Commercial Crew and Cargo 

Commercial Crew- Currently, the Russian Space Agency, Roscosmos, provides crew 

transportation to the International Space Station (ISS). This contract is worth $490 million 

through 2018. 16 However, NASA is funding U.S. private sector development of crew 

transportation capabilities to the ISS on domestic launches that can then be procured on a fixed 

price contract after certification by NASA. 17 NASA hopes to demonstrate this capability in 

2017. 

NASA awarded contracts to two of the final competitors in the Commercial Crew Program, the 

Boeing Company (Boeing) and SpaceX. The final phase of the program, Commercial Crew 

Transportation Capability (CCtCap) provides significant government funding to finalize designs, 

test various elements, and certify each of the crew systems. The firm-fixed price contract 

guarantees each company at least two flights to the ISS and as many as six for a total of 12 

14 Found at the Federal Business Opportunities website. Retrieved at: 

https: \\'Ww.tho.gov index?s · opportunitv&mode -f()rm&id ·2831d4142a7bb8fd6323b997! add63hc&tab-·core& cv 

icw-1 (Last Accessed on April5'h, 2016). 15 NASA Press Release, "NASA Awards Venture Class Launch Services Contracts for CubeSat Satellites." October 

14, 2015. Retrieved at: h.t!v:- www.na~a.l!ov ·press-release·nasa-awards~venture-class-launch-services-contracts-forcubcsat -':'>atcllitcs. 

''NASA-Press Release, "NASA Notifies Congress about Space Station Contract Modification with Russia," August 

5, 2015. Retrieved at: https:f/wv.·'\v.nasa.gov/sites/deH"wlt/tiles,·atoms/tiles/sovuz seat modification letter. pdf 17 NASA provided $49 million in 2010 for CCDevl, $315 million in 2011 for CCDev2, $1.167 billion for CCiCap 

in 2012,$29.582 million for CPC in 2012, and $6.8 billion for CCtCap in 2014 for a total of$8.361 billion. See 

supra 13. 

4 
7 

possible flights. The potential contract value is $4.2 billion for Boeing and $2.6 billion for 

SpaceX. 18 

Commercial Cargo- NASA began funding commercial space transportation services to the ISS in 

2006 by funding multiple companies to develop systems for transporting cargo to the ISS with an 

eye towards eventually having multiple carriers compete for the resupply contract. This was 

accomplished through the Commercial Orbital Transportation Services (COTS) and Cargo 

Resupply Services (CRS) programs. NASA purchases cargo transportation to the ISS under the 

CRS contracts with Orbital A TK and SpaceX and under the CRS2 contract with Orbital A TK, 

Sierra Nevada, and SpaceX. 19 

In 2008, NASA signed two CRS contracts. The original SpaceX contract was valued at $1.6 

billion for 12 missions and the Orbital Sciences contract was valued at $1.9 billion for 8 

missions. Through contract extensions, NASA has since awarded SpaceX eight additional and 

Orbitai-ATK two additional space station cargo-supply missions. While the SpaceX contract 

includes a down-mass capability (returns cargo to Earth), Orbital ATK's Cygnus spacecraft (like 

the European Space Agency's ATV or the Japanese Space Agency's HTV) has no down-mass 

capability (by design). In January, 2016, NASA awarded the CRS-2 contracts to SpaceX, Orbital 

A TK, and Sierra Nevada Corporation. The CRS-2 awardees are to each fly at least six cargo 

missions, between 2019 and 202420 

Commercial Launch Market Demand 

The Federal Aviation Administration's Commercial Space Transportation Forecast is published 

every year by the FAA's Commercial Space Transportation (AST) office and the Commercial 

Space Transportation Advisory Committee (COMSTAC). In the April 2015 publication, 

COMSTAC predicts a "healthy" demand for commercial launch services to geostationary orbit. 

It projects that the number of commercial launches to geostationary orbit will be 17 launches in 

2015 and 18 launches in 2017. The report only forecasts up to 2017 for commercial 

geostationary launches due to realignment of issuance dates of the report. 

For non-geostationary orbit (NGSO) launches, the report predicts a global average of 13.1 

launches per year over the next ten years. It forecasts a peak of 19 launches in 2016 due to 

completion of the Iridium constellation. Once complete, launches will decline to 10-11 per 21 year. 

18 NASA fact sheet, "NASA's Commercial Crew Program." Retrieved at: 

Accessed on April4'", 2016). 

Accessed on April 4th, 

NASA Press Release, "NASA Awards International Space Station Cargo Transportation Contracts." January 14, 

"0 16. Retrieved at: lillj J;__\\c\'>~lliO'ch;;l~=''d:'l<;i!O~!lll:'il:i':'-'Affi;,-J_W£!:1!ill!!2llu_l_:5l'i"-'~illl'"l~':ill:f:<l:l@llOlli'fr 

(Last on March, 

Federal Aviation Administration, ''20 15 Commercial Space Tra,nsr>ortaticm 

h~tr~.: f}b,o_\l! 

_:2Q_I~m1I (Last Accessed on 

5 
8 

The report takes into account an expected jump in small satellite constellations to be launched in 

the coming years. "From 2015 2018 the report forecasts a number of small commercial 

satellites to be launched as Iridium, ORBCOMM. Planet Labs, and Skybox all deploy their 

constellations. "

22 

Table 1: NGSO Launch History and Projected Plans 

co 

IS 

16 

14 

Ic 

I I I I 10 

.::oo:-. .::oo6 .::oo- .::oos 20o9 2010 2011 .2012 .2ou 2014 2015 2o16 .::or: .::o1s .2o19 .::o2o 20.21 ::o:.:.2 .2023 2o.N 

Source: I·AA, ''2015 Commercial Space Transportation Forecasts." 

Commercial Telecommunications and Earth Observation Services Demand 

Launch service revenue derived from private sector customers is dominated by commercial 

telecommunication satellites, but there are an increasing number of commercial Earth 

observation satellites purchasing launch services. To put the respective size of the 

telecommunication and Earth observation services sector in perspective: mobile, fixed, and 

consumer telecommunication satellite servicing revenues account for 98.5 percent of global 

satellite services ($121.3 billion), with the remaining 1.5 percent derived from commercial Earth 

observation ($1.6 billion).23 

According to the Satellite Industry Association's "2015 State of the Satellite Industry Report," 

Earth observation services grew by 9 percent and mobile satellite services grew by 25 percent in 

201424 The major growth in mobile satellite services, according to the report, is due to an 

increase in data services for aviation customers. Overall, satellite services reported a growth of 4 

percent in 2014. In the same year, the launch industry grew by 9 percent as a result of more 

European and U.S. commercial satellite launches than in 2013 25 

22 Ibid., 3 

Satellite Industry Association, ·'20I5 State of the Satellite Industry 

Accessed on 

6 
9 

Small Satellite Demand 

Technological advances in computer hardware and sensors allow satellite manufactures to put 

more capabilities in smaller spacecraft. Small satellites arc generally considered those that weigh 

less than 500 kilograms. Due to their size and low mass, it is much easier to build and launch 

small satellites than larger satellites. The drawback of small satellites is that they usually do not 

have the same capabilities as larger satellites. Also, due to the relatively low orbit at which they 

arc deployed. small satellites encounter more atmospheric drag and do not stay in orbit for as 

long as satellites in higher--like geosynchronous--orbits. On the other hand. constellations of 

small satellites can be launched more frequently and their hardware can be updated more often. 

Some estimates have suggested that over the past decade $2.5 billion has been invested in small 

satellite development.'" Table 3 shows the significant increase of small satellites launched over 

the past three years. 

26 Satellite TV. Satellite. Radio, and Satellite Broadband. 

:

7 Transponder Agreements and Managed Services. 

Voice and Data. 

,., Clay Dillow. "Here's why small satellites arc so big right now." Fortune. August 4, 2015. Retrieved at: 

l)tlP.; .. J,:rwnv,~.\'lll_~Q_I ~-D~_i2:L~l!l::!lJ.:-_~;-~u.,tl.~t.~'--:=rtL~\\'iJI;lc.~-- (Last Accessed on April!, 2016). 

7 
10 

I.'P 

i(l(j 

Source: F:urospace LEA T data, courtesy of the Space Foundation 

fi!'!.Cl\\'d ~g) 

llll"\i~n'' ( !-!H kf) 

'!,\1\;r,>{\1-12\lk:g) 

Ill \:hru (!21-."'0(, ~tl 

\kdmm(->\l].]~(i\ikgl 

, I ~rg~ ll '(l) .. Hl{l1) kgl 

In June 2015, the Science and Technology Policy Institute, a Federally Funded Research and 

Development Center (FFRDC), published a study sponsored by the National Aeronautics and 

Space Administration (NASA) and Office of the Director of National Intelligence (ODNI) study 

titled Global Trends in Outer Space. According to this study, small satellite demand for launch 

services has been increasing and is forecasted to increase significantly over the next few years. 

Small satellites are not a fimdamentally new concept~even the first artificial satellite, 

Sputnik-I, .fits most definitions of a modern small satellite. However, the high cost of 

launch into space and importance of operational missions has, over time, driven the 

production of larger, more capable, longer lived, and rigorously reliable satellites. While 

these satellites are highly capable, they have high production costs. Recently, there has 

been interest in developing small, low-mass satellites, which have more limited 

capabilities but cost less to produce. 

While small satellites have lower component, launch, and development costs, they have 

significantly less power andji.mctionality on a single platform. Because of these 

characteristics, small satellites ofien have higher mission and component risk tolerances 

and lower lifetime expectotions. The lower costs make it simpler to build additional 

platjiJrms·-whetherfiJr a constellation or .for replacements. 

The lower cost of smaller satellites is allowing new entities to build, launch, operate, and 

support satellites, especially in low Earth orbit. In turn, the greater number ofinterested 

parties results in a more competitive market for goods and services, driving down costs 

further. The result has been a spike in the number of small satellites below 50 kilograms 

in the last few years, which has been proiected to increase significantly over the nextfew 

8 
11 

years based on mission plans and launch manifests. From 2013 to 2014 alone, the 

number of microsatellites launched in the range of 1-50 kilograms increased 72 percent. 

Large communication microsatellite constellations have been announced by SpaceX and 

One Web, consisting of 4, 025 and 648 satellites, respectively (Space Works Enterprise, 

Inc. (SE!) 2015). This growth is in sync with an increase in the available market of 

component and payload suppliers and developers, as well as for launch and satellite 

service providersfor launch, launch integration, ground-station construction or 

management, and soforth. However, the long-term viability of this market of parts, a 

sustained demand for missions, and commercial returns on investment are all interlinked 

claims that remain to be observed311 

Commercial Launch Market Supply 

Current U.S. Orbital Launch Service Providers 

Orbital A 1K- The Dulles, Virginia-based Orbital A TK offers three different launch vehicles: the 

Antares, Minotaur and Pegasus rockets. It is currently developing a medium- to heavy-class 

rocket that uses solid propulsion. 31 

SpaceX- Space Exploration Technologies (SpaceX) is a Hawthorne, California-based company 

that offers the Falcon 9 launch vehicle. SpaceX's heavy-lift vehicle, the Falcon Heavy, is 

scheduled to launch later this fall 32 

ULA- United Launch Alliance, a joint venture of Lockheed Martin Space Systems and Boeing 

Defense, Space and Security, is headquartered in Centennial, Colorado and currently operates 

three different launch vehicles (Atlas V, Delta II and Delta IV). ULA's next launch vehicle, the 

Vulcan, is currently under development to replace the Atlas V. 33 

U.S. Small Satellite Launch Services 

Several new launch vehicles are being developed specifically to address what some believe is 

latent demand among small satellite operators. 34 These rockets are designed to launch payloads 

10 Bhavya Lal. et al. "Global Trends in Space." Science & Technology Policy Institute, June 2015. Retrieved at: 

Jltill~'i~---~i~::..·.J~~.ida.org.·idamcUia (Q!]2QratciFilcs Publications STPIPuhs/20 1 5·'p5242v2,ashx (Last Accessed on April 

5, 2016). 11 Mike Gruss, "Orbital Developing Rocket to With SpaceX, ULA." SpaceNews, January 14,2016. 

Retrieved at: hJU!L-.a>.ilc~J~~"'·'~QDLQJQilill:<JD!ili,'illl:u;::JI>.-J).<'.l:!Q:cc:QIDJ2~<C:illlli:::illJl&S_'•.::JlJ!!L (Last Accessed on March 

31, 2016). 

" Peter B. de Selding, "SpaceX says reusable stage could cut prices 30 percent, plans November Falcon Heavy 

debut," SpacelV'ews, March 10,2016. Retrieved at: http:,.·spacenews.com,spacex-sa"s-n.·usablc-stage-could-cutPJ:I.~:ill:::1.\!.:J2!lilli:'.l!L'i!::Jiilo,:Qll:!J'~U!l::!!""'~l2IT(Last Accessed on April15, 2016). 

Mike Gruss, "ULA's Vulcan Rocket To be Rolled out in Stages." SpaceNews, April 13,2015. Retrieved at: 

http:· sp<-h.:tncws.com: u!as-vukan-rod.d-to-be-rolled-out-in-stm.!es.' (Last Accessed on March 31, 2016). 34 Federal Aviation Administration, "The Annual Compendium of Commercial Space Transportation: 2016" January 

2016. Retrieved at https:. ·\VW\\.f3a.gov.about ·office org. headquarters officesiastimcdia/20 16 Comrcndium.pdf 

(Last Accessed April 5, 2016). Federal Aviation Administration, "2015 Commercial Space Transportation 

Forecasts." April, 2015. Retrieved at: 

9 
12 

with masses under 500 kg ( 1,102 lb) to low Earth orbit (LEO). Though the price per kilogram 

may remain high relative to larger launch vehicles, presumably there will be additional value in 

scheduling; small satellite operators, especially those with constellations of many satellites, can 

have greater control over the orbits their satellites are placed rather than simply being a 

"piggyback", rideshare secondary payload for a larger satellite. New launch vehicles are in 

various stages of development, like the Electron by Rocket Lab and LauncherOne from Virgin 

Galactic. 35 

Foreign Launch Service Providers 

China- The China Great Wall Industry Corporation (CGWIC) aggressively pursues international 

clients via package deals that include satellite manufacturing and launch. However, these 

CGWIC launch contracts are not internationally competed. China conducted 19launches in 

2015 36 Also in 2015, China introduced two new small-class launch vehicles, the Long March 6 

and the Long March 11.37 The country continues to develop the Long March 5 and Long March 

7, both of which are expected to be launched in 2016 from a new launch site on Hainan Island. 38 

Finally, China's human spaceflight program continues development, while the Chinese National 

Space Agency (CNSA) carries out robotic missions to the Moon. These activities point to an 

expansion of China into the international commercial launch market. 39 

India- The Indian Space Research Organization (ISRO) and its commercial arm, Antrix Corp., 

are expanding India's domestic launch capabilities and seeking new commercial opportunities. 

ISRO's Polar Satellite Launch Vehicle (PSLV) has completed 25 operational missions and India 

has funded 15 more launches to be completed before 2020.40 In February of this year, ISRO 

Chairman, A.S. Kiran Kuman, said that ISRO plans to "largely privatize" the PSL V by 2020 and 

to increase its launch rate from 12 to 18 per year. 41 India has also developed its Geosynchronous 

Satellite Launch Vehicle (GSLV) and intends to launch a GSLV Mark-3 (also known as the 

LMV3) with its new, Indian-made Cryogenic CE-20 engine on the upper stage in December of 

https:; \\ w\-v·.faa.goviabout/office org!headquarters offices:ast·'media/Commercial Space Transportation Forecasts 

2015.pdf(Last Accessed on March 31, 2016). 35 Federal Aviation Administration, "The Annual compendium of Commercial Space Transportation: 2016." January 

2016. Retrieved at https:·:\n\w.hta.gov:ahouJ·otticc om.'headqum1ers offices:astirnedia/20 16 Compendiurn.pdf 

(Last Accessed AprilS, 2016), 2. 36 Deganit Paikowsky, et al. "Space 20I5: A Year In Review." Tel Aviv 

Accessed on April 5, 

Marcia Smith, "China Debuts Second New Small Rocket, Long March II." Space Policy Online. com, September 

25, 2015. Retrieved at: blt~W\-\ .spacepo!icvQDJinc.com news:china~debuts-second-new-small-rocket-!ong-

(Last Accessed, March JI, 20 16). 

Bradley Perrett, March 7 Is Delayed Again, Due To Fly In 2016." Aviation Week, March 25, 20I5. 

Retrieved at: (Last Accessed on March 31, 

20I6). 

39 Federal Aviation Administration, "The Annual Compendium of Commercial Space Transportation: 2016". 40 Peter B. de Selding, "India Oks Budget for Building, Launching I5 PSL V Rockets by 2020." SpaceNews, May 

22, 2015. Retrieved at: http:• spaccnews.convindia-to-build-and-launch-15-pslv-rockets-bv·2020/ (Last Accessed on 

March 29, 20 I6). 41 Srinivas Laxman, "Plan to largely privatize PSL V operations by 2020: ISRO chief." The Times of India, February 

15, 2016. Retrieved at: 1H!.Jr0.iln~sotiJl9jll:llliJLatimei:~QllUDili~J/Plan-to-lamely-privatize-PSLV -onerations-bv2020-lsro-chicf-articlcshow. 50990 145.cms (Last Accessed on March 29, 2016). 

10 
13 

2016.42 On the GSLV Mark-3's maiden voyage in 2014, it demonstrated re-entry and recovery of 

an experimental crew capsule.43 

Russia- On January 1, 2016, Russia's Federal Space Agency Roscosmos was dissolved and all of 

its responsibilities transferred to the Roscosmos state corporation.44 Roscosmos' two main 

launch vehicles, the Soyuz and Proton, launch regularly. The Proton had 8 launches in 2015.45 

The Soyuz had 17 launches in 2015.46 Among its capabilities, the Soyuz is currently used to 

bring astronauts and cosmonauts to the International Space Station. The Soyuz rocket also 

launches from the European Space Agency's Guiana Space Center in South America. The 

Proton launch vehicle is used for both Russian government and commercial satellites launches. 

Russia intends to phase out the Proton rocket b); 2025 and replace it with the Angara AS, which 

completed a successful first test flight in 2014. 7 Russia is also planning to phase out its Dnepr 

launch vehicle, which was based on decommissioned Russian intercontinental ballistic missiles, 

and its Zenit medium-class rocket. 4

8A9 

European Space Agency (ESA)- In addition to the Soyuz, ESA uses the Ariane 5 launch vehicle 

and the Vega small launch vehicle. The French-based company Airbus Defense and Space is the 

Ariane 5's prime contractor. The Italian Space Agency, in cooperation with ESA developed the 

Vega launch vehicle that is used to launch small satellites. In August 2015, ESA committed over 

$3 billion to upgrade both the Arianne and Vega launch vehicles. The Ariane 6 and the Vega-C 

are expected to debut in 2020 and 2018, respectively 5° 

42 K.S. Jayaraman, "India's heavy-lift rocket on track for December debut following engine test" SpaceNews, 

February 22, 2016. Retrieved at: http://spacencws.comlindias-heavv-lift-rockct-on-track-for-dccembcr-debutfollo"in"-en"ine-lesti (Last Accessed on March 29, 2016). 43 K.S. Jayaraman, "India Tests GSLV-3 Rocket and Crew 

18, 2014. Retrieved at: llliJL:llli!££!.!£YC'clQ!!!Jns!i<Jc::JSili::W.Y:J'-:L\l'f.h!~lllil=lli::9J2!illl£.:ctYi!J~l!!litd>J1ill::!ill=!i 

(Last Accessed on 

" Avanesh Pandey, "Russia:s Federal Space Agency Dissolved, Responsibilities To Be Transferred To State 

Corporation." International Business Times, December 28,2015. Retrieved at: http:liwww.ibtimcs.com;russiasfederal~spacc-agcnc\-dissolvt.:d-responsibilitics-bc-transfcrrcd-statc-2,40831 (Last Accessed on March 29, 2016). 45 Federal Aviation Administration, "The Annual Compendium ofCommercia1 Space Transportation: 2016" 46 Federal Aviation Administration, "The Annual Compendium of Commercial Space Transportation: 2016" 

"Warren Ferster, "Russia Aims To Retire Proton in 2025 as Takes Over." March 17, 2015. 

Retrieved at: (Last Accessed on 

March 30, 48 Doug Messier, "lMF: Ukraine Space Sector Possibly Suffered 80 Percent Revenue Loss." Parabolic Arc, 

February 15, 2016. Retrieved at: h~ww_\\.parag_olicarc.com:2Q 16:02'16'ukraine-spacc-scctor (Last Accessed on 

April 4, 20 I 6). 49 lbid. 50 Peter B. de Selding. "ESA Inks $3.8 Billion in Contracts for Ariane 6, Vega-C and Spaceport Upgrades." 

Space News, August 12, 2015. Retrieved at: b1tl2~ . .2llil£~1J.f:..\Y.5,f:..Q!D/esa-inks-J-8-billion-in:£Ontracts-tQr-arian~:§.: 

vl'ga-c-an_Q-=:w.mQIL:.urgrades · (Last Accessed on March 30, 20 16). 

11 
14 

Vehicle Provider Country kg to LEO kg to G10 .first launch 

Cab-3!\ CubeC'ab L:SA N/A 2017* 

Lynx Mark l!l XCOR Aerospace USA 10 N/A 20! 8* 

(iOLaunchcr-2 O:ncrat10n Orb!! LSA 45 Nii\ 20 17* 

Electron Rocket Lab USA !50 N/A 2016* 

SOAR Smss Space Systems S\\lt:terland 250 N!i\ 201 R* 

LaunehcrOne Y1rgm Ci'Jiactic USA 400 N/A 2017* 

Firetly Firefly Space Ststems USA 400 N/A 2017* 

Pegasus Orbital ATK USA 450 N/A 1994 

Minotaur! Orb1tal ATK USA 'fj 2000 

!.ong :Vlar..::h 1! PLA China 700 20!5 

Mmotaur IV Orbltal ;\TK USA 1.600 < 2010 

Vega Arianespm:c France L96 2012 

Rokot VKS/Eurockot Russia 2.150 1990 

XS-1 [),\RPA USA 2,267 !\J/A 2018' 

';tratolaunch Starto!aunch Systems USA 

Dncpr lSC Ko~motra:. Russw 3,200 '"""~'"' 1999 

Minotaur V Orblial ATK USA N;A 2013 

PSI.V !SRO/Antnx India 3,250 1,425 ]993 

Dct!a l! ULA USA 3.470 Nil\ 1998 

Angara 1 2 Roscnsmos Russia 3}WO N/A 2014 

GSLV !SRO,Antnx lndw 5.000 2.500 200 I 

:\ntar~.C"s Urbllal ATK USA 7.000 N/A 201 J 

Soy tv F(J VKS/Rosco.smo.s Russia 7.800 N/A 2001 

GSLV Mark-3 (LMVJ) !SRO/i\ntnx India 8.000 4,000 2016* 

Delta IV (Medium) lJLA USA 12.900 6,160 2002 

Fakon 9 Space X USA 13.150 4.850 20!0 

Long March 7 PLA Chma 13.500 N/A 2017* 

Minotaur"C Orbital ATK USA 1-1_580 N/A 2016* 

Long Man:h 6 PL/\ Rus~1a 15,000 N/A 2015 

Vulcan liLA USA 18.510 8.900 20!9* 

,\tlas V Ul.AiLMCLS t 1SA 18.814 8,900 2002 

:\mtne 5 i\nancspacc France 2 I .000 9,500 1996 

Armnc 6 Ariancspacc France 2UJOO 11.000 2020' 

Proton :\1 VK.')/Rosco:.mosi! l.S Russm 23_000 6.920 2001 

Angara :\5 RoscosJnos Russia 24.500 7,500 2014 

Long 1\·tarch 5 PL\ China 25,000 14.000 2016* 

Delta !V l!cavy lJLA USA 28.370 13.810 2004 

Falcon lkavy Space X (;SA 53.000 21.200 2016' 

Blue Ongm Vehicle Blue Ongin USA UndJsdoscd lhJdJscloscd 2020* 

Data takt:ll j/·om f·AA 20/6 ( ompe11dwm and respectn:e launch sernce provtder s wcbslle .\umhers rejlect ma:nmwn !{!ling 

capabili!;es 

12 
15 

Reusable Vehicles 

A majority of launch costs is vehicle hardware. For some launch providers, the first-stage engine 

alone makes up to 65 percent of the total launch cost. 5

1 To drive down launch costs, many 

companies are looking at ways to reuse launch vehicle components, rather than discarding them 

after launch. Some estimates say that reusing such launch components could reduce costs by a 

factor of I 00 52 With the possibility of dramatically reducing launch costs, some launch 

companies are investing in reusable launch vehicle technologies. The Space Transportation 

System (Space Shuttle) was partially reusable as well; however, inspection, maintenance, and 

refurbishment of reusable components for a human-rated launch system proved to be more far 

expensive than originally planned53 

SpaceX and Blue Origin have demonstrated the ability to land and recover the first stage of a 

launch vehicle. SpaceX has landed and recovered their first stage after delivering its second stage 

to an intended orbit 5 4 Blue Origin has landed and recovered their first stage after delivered a 

suborbital payload. The goal of recovering the first stage of a launch vehicle is to refurbish and 

reuse the first stage for future launches. ULA has proposed a method to detach the engine of a 

launch vehicle after the first stage and float it back to the Earth with parachutes where a 

helicopter can then catch the hardware 5 5 Airbus has proposed a similar method where the 

engine, avionics, and propulsion bay of the first stage detach and glide back to Earth with 

winglets and land on a runway 5 6 

Key National Policy Issues 

Use of Excess ICBM Motors 

Since 1998, national policy is that excess U.S. intercontinental ballistic missiles or their 

components should not be used for commercial launch services. The 2013 National Space 

Transportation Policy states: "Excess U.S. ballistic missiles [or their components] shall either be 

retained for government use or destroyed,'' and that departments and agencies may use them on a 

51 Doug Cameron, "How to Catch a Rocket 'With a Helicopter." The Wall Street Journal, April 14,2015. Retrieved 

at: (Last Accessed on March 31, 

1016). 

52 Jessica Orwig, '"Elon Musk's rocket landing could make space travel costs cheaper than a penthouse in NYC'' 

Business Insider. December 22. 20 !5 (Last Accessed on March 31. 2016 ). Retrieved at: 

13 
16 

"case-by-case" basis. The policy also directs that agencies should only use ICBMs in a way that 

"limits the impact on the U.S. space transportation industry."57 

According to Federal law, departments and agencies may use such excess ballistic missile assets, 

including rocket motors, to launch payloads into orbit on a case-by-case basis with the approval 

of the Secretary of Defense and notification to Congress that: (I) the use would result in costsavings to the Federal Government when compared to the cost of acquiring space transportation 

services from United States commercial providers; (2) meets all mission requirements for the 

agency, including performance, schedule, and risk; and (3) is consistent with the international 

obligations of the United States. 5

8 Federal law also requires the Federal Government to acquire 

space transportation services from United States commercial providers whenever such services 

are required in the course of its activities, subject to a number of exceptions. 59 Launch vehicles 

derived from excess ballistic missiles are subject to this requirement and can only be acquired if 

an exception is determined. 

There are examples of companies that use excess ICBM assets. In 1997, for example, the U.S. 

Air Force awarded its Orbital/Suborbital Program (OSP) contract to Orbital Sciences 

Corporation (now Orbital ATK), which helped the company develop its Minotaur line of launch 

vehicles that use decommissioned ICBM rocket motors in combination with commercially built 

upper-stage motors. Orbital A TK continues to develop and use such launch vehicles. In 2013, 

NASA launched the Lunar Atmosphere and Dust Environment Explorer (LADEE) to the Moon 

on a Minotaur V. In total, the Minotaur family has launched 25 variants since 2000, all 

successfully.60 In July 2015, the Air Force awarded Orbital ATKa $23.6 million contract to 

launch a small satellite aboard a Minotaur IV rocket in 2017 61 The Aerospace Industry 

Association claims that using ICBMs as launch vehicles is only marginally cheaper than using 

other vehicles on the market. 62 This is due to costs associated with storing, maintaining and 

converting the missiles to usable launch vehicles63 

Indian Launch Services 

57 The National Space Transportation Policy, November 21, 2013. Retrieved at: 

h~-\~ ... \~:-~~._,tE!.o:<:L.W_\.:.~L~? __ I}~faqJL.flJ_c.s fll,c~··nati(lnal space transpmtation policv I 121 "0 1 3.pdf (Last Accessed on 

April 4, 20 16). 58 51 U.S.C. §50134 (2016) 59 51 u.s.c. §50131 (2016) 60 Minotaur Fact Sheet, Orbital ATK. Retrieved at: hnps: :wW\-\ .orbitalatk.com.f1ight-svstcmsispace-launchvchiclcs minotaur (Last accessed on April 15, 2016) 61 Mike Gruss, "U.S. Air Force's ORS-5 Satellite To Launch on Minotaur 4." Space!Vews, July 9, 2015. Retrieved 

at: ~· spacenc\vs.com ·u-s-air-fon:cs-ors-5-satcllitc-to-launch-on-minotaur-4: (Last Accessed on April 4th, 20 16). 62 Aerospace Industries Association, "America's Space Propulsion Industrial Base is at Risk." Retrieved at: 

http:. (W\\ w.aia-aerosracc.org a~sets 'AlA Space Propulsion lndustria! Base Issue Paper. pdf (Last Accessed on 

April 4'\ 20 16). 63 Aerospace Industries Association, "America's Space Propulsion Industrial Base is at Risk." Retrieved at: 

htlJ2~-~~~~v.aia-aeJ:g~~.tL~~~:2!:g·l!.;;.sets/AlA Space Propulsion Industrial Base Issue r~~Qf (Last Accessed on 

April4'h, 2016). 

14 
17 

The United States has a long-standing policy of not supporting the development or acquisition of 

space transportation systems in non-Missile Technology Control Regime (MTCR) countries64 

The Missile Technology Control Regime is an informal and voluntary association of countries 

which share the goals of non-proliferation of unmanned delivery systems capable of delivering 

weapons of mass destruction, and which seek to coordinate national export licensing efforts 

aimed at preventing their proliferation65 The MTCR was originally established in 1987 by 

Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. Since that 

time, the number ofMTCR partners has increased to a total of thirty-four countries, all of which 

have equal standing within the Regime. India is a not a member of the MTCR. However, U.S. 

policy is to support India's entry to the MTCR66 India formally submitted an application in June 

2015, with active support from the United States. 67 This submission is still under consideration. 68 According to Foreign Policy: 

India has appliedfor MTCR membership as a part of its efforts to integrate itself with the 

global non-proliferation community .... the efforts began right ajier its nuclear tests in 

1998, when India expressed its supportfbr the basic objectives oft he NPT -marking a 

complete turnaroundfrom the approach it had previously demonstrated. The United 

States, one of the founding designers of the existing global non-proliferation architecture, 

realized that while India would no/join the NPT, it could play a crucial role in 

strengthening other non-proliferation and export control bodies. This was the premise of 

the India-US. nuclear initiative which began in 2005, and over the years, the importance 

of integrating India with the global non-proliferation architecture has now been realized 

by many other J<Overnments, inc/udinJ< Australia, Canada, France, Germany, Japan, 

Russia, South Korea and the United Kingdom." 

On July 20, 2009, the United States and India signed a Technology Safeguards Agreement which 

changed U.S. Government (USG) policy to permit the launch of civil or non-commercial 

satellites containing U.S. !TAR-controlled components on Indian space launch vehicles. 70 

However, this agreement did not include permission to launch commercial satellites. On a caseby-case basis, U.S. companies must receive a license to export satellites to India for launch that 

waives the non-MTCR compliant acquisition of launch services policy prohibition. In 2015, 

Spire Inc. of San Francisco, California, was the first company to have its cubesats to launch from 

Accessed on 

Missile Technology Control Regime Retrieved at: l.l!.\]2;_,_\:1',\'W.mtcr.inCo end ish (Last Accessed on April 

, 2016) 66 Tom 

68 Ibid. 69 Arka Biswas, "India and the Missle Regime." ForeignPolicy, September 18,2015. Retrieved at: 

http: fQreignpolic> .com 20 15:'09 · 18 india-and-the~missilc-renime; (Last Accessed on April 6, 20 16). 70 DDTC guidance governing the export of satellites to India for launch is provided under "Licensing Satellite 

Components for Launch from India (August g•h, 2009). Retrieved at: 

h L\P.\; ·--\\~~ .~Y J? ms!\!!h~~.~~t.~ :£.QYJi£§:D~ing__Qi~f._llJ!J~DJ1i: .. \t~J~2;Q1~_lD_Q ia LaJ!!]ch-l.!llitlL~JlQ.f (Last Accessed on Apri I 

6'h, 2016). 

15 
18 

India. 71 Skybox Imaging of Mountain View, California, owned by Google's Alphabet, has 

contracted for multiple commercial imaging satellites to launch on the PSLV72 PlanetiQ of 

Boulder, Colorado, has contracted for a late 2016 launch, and Airbus Defence and Space of 

Europe has launched commercial Spot6 and Spot 7 Earth observation satellites, both with U.S. 

components, on PSLV rockets.n74 

According to the United States Trade Representative (USTR), some satellite operators and 

manufactures are asking for increased access to Indian launch services due to what they see as a 

shortage of U.S. launch capacity75 Others, including the Commercial Space Transportation 

Advisory Committee (COMST AC). have warned against increasing access because "India's stateowned and controlled launch providers whose pricing structures and related costs are not able to be 

confirmed as market-based hold the potential to dist011 the conditions of compctition.''76 

Hosted Payload/Ride Share Challenges 

A hosted payload is a module that connects to a commercial satellite. The module shares the host 

satellite's power supply but operates on its own, independent of the host. Commercial satellites 

launch regularly and the modular design of hosted payloads in principle makes them easy to 

install. Some in the U.S. space industry see hosted payloads as an efficient method of launching 

Federal Government payloads, such as the Space Based Surveillance follow-on mission, but raise 

concerns that the DoD and other government agencies have resisted committing to hosted 

payloads. 7778 

Another option for launching small payloads exists in the form of rideshares. Sometimes, launch 

service providers will have extra room in a launch vehicle and open up the space for secondary 

payloads. These slots are often filled by small payload that ride along with the primary payload 

'

1 Spire Inc. press release. "First of Many: Beginning of First Ever Commercial Weather Network Satellites to 

Reach Orbit." September 28, 2015. Retrieved at: .b.JlP~Pirf.S.Q!JljJ))i.gb,L0.JJ,~~~s tirst-cornm-:rcial-\\s;Jitl!£r-s<lltiJjJs.: 

(Last Accessed on April6. 2016). 

Peter B. de Selding, "PSt.V Rocket Launches India's 1" Astronomy Satellite, 4 Spire Cubcsats." SpaceVews, 

September 28,2015. Retrieved at: hi!p.. (Last 

Accessed on April6, 2016). 7 l Peter B. de Se!ding, "PSLV Rocket Launches India's 1st ASlroriOITIV 

September 28. 2015. Retrieved at: "'·'h'd'.'l'!';:L•.~o.c-'.'lli.l.'1"_L,•t:.C\,•tl.l\'i."'.U! 

Accessed on April 6, 2016). 

" Jeff Foust. ··rJanetiQ Selects India's PSL V to Launch its First Satellites." .vn.?ce. vews. 

Retrieved at: 

6. 2016). 15 Jeff Foust, "U.S. Considers l\·"laking it Easier To Launch from India." 5i'pace,Vews, October 23, 2015. Retrieved at: 

~'"''~'' '''·''·""""''"'-'=""'''""'"'·~c:''""~'""""""''"'-"'""''-"""~ (Last Accessed on March 31 ", 2016 ). Observations, Findings, Recommendations to the Associate Administrator tOr Commercial Space 

Transportation (January 29, 2016). 77 Mike Gruss. "Hosted Payload Hopefuls Eye Air force's SBSS Follow-on System." .vu.uce·.vews. 

20 I 5. Retrieved at: miLifll"-.;c'lC:.''·""'i'!!Ul•,''l ::ci-JQil_\ ll_\11Q:J.~2J1~'li:::ill:::il'.r:::J\l!S••2:c'~~O::.Ll'll\!c'.l.:.t''l:.::C\ .. c•.!.<:.' 

on March 31, 2016). 

of Hosted Payloads"" Sat( 'om f·hmtier, March 8, 2016. 

\' lla t '-hu l ding -[1_n~ h.: J j1c-_ad op_Z i '-~n-~~ f-Jl\l_,~{ .:5:!_-:PitlJ!:1_~!0;- (Last 

16 
19 

but are deployed separately. Rideshares are subject to launch delays encountered by the primary 

payload and are bound to whichever orbit the primary payload chooses. 

17 
20 

Chairman BABIN. The Subcommittee on Space will come to order. 

Thank you for being here. 

Without objection, the Chair is authorized to declare recesses of 

the Subcommittee at any time. 

Welcome to today’s hearing entitled ‘‘The Commercial Space 

Launch Industry: Small Satellite Opportunities and Challenges.’’ 

I recognize myself for five minutes for an opening statement. 

The commercial space industry truly is an amazing industry. It 

generates hundreds of billions of dollars of economic activity, serving both the private and public sectors, all while pushing the 

boundaries of innovation and fostering the United States as the 

global leader in space. 

Part of this innovation is a new space spin-in phenomenon. Computer, data analytics, and IT technologies having their origin in our 

space program but more recently developed outside of the space 

sector are being reapplied for space-specific purposes. 

Significant research and development investments are also being 

made in the United States to create and manufacture new types of 

small satellite technologies and application. One of the largest barriers to that small satellite companies—that they face is the cost 

of launch. Launch often accounts for a significant portion of a small 

satellite’s overall mission cost. 

Recent government incentives for launch vehicle development 

may allow small satellite operators greater access to space. New 

launch vehicle test flights present great opportunities for small satellite operators to launch secondary payloads if the companies are 

willing to accept the primary payload schedule, mission profile, and 

mission risk. 

The development of a small satellite industry is also attracting 

investment for a new class of launch services to serve the specific 

needs and requirements of smaller satellites and associated onorbit constellations. A number of American companies in various 

stages of development plan on offering dedicated launch services to 

the small satellite industry in the next few years. These companies 

hope to fulfill the unmet demand of the small satellite market. 

They also promise to provide more flexible launch services such as 

delivery to unique orbits and rapid replenishment. 

There is a lot of change going on in the small satellite and 

launch services industry. Winston Churchill once said, ‘‘There is 

nothing wrong with change if it is in the right direction.’’ From my 

point of view, the investment and innovation occurring in the small 

satellite and launch industry is good for America, and it is an important step in the right direction. 

But change often presents both challenges and opportunities. 

Companies are seeking to supply the demand for greater small satellite launch capability in many unique and innovative ways. Some 

solutions carry more risk than others. Some solutions are easier to 

implement than others. Some solutions require government action 

and some do not. 

Today’s hearing gives us the chance to explore these challenges 

and opportunities. One policy challenge is excess intercontinental 

ballistic missile motors. It is longstanding national policy that excess U.S. ICBMs or their components should not be used for commercial launch services. This policy is established in the 1998 Com-
21 

mercial Space Act and reiterated in the 2013 National Space 

Transportation Policy, which states: ‘‘Excess U.S. ballistic missiles 

or their components shall either be retained for government use or 

destroyed,’’ and that departments and agencies may use them on 

a case-by-case basis. 

But should this policy be changed to allow greater use of excess 

ICBM motors for commercial launch services? This isn’t a blackand-white issue, and the policy outcomes associated with either 

keeping or modifying existing policy will create winners and losers. 

And those in favor argue that many U.S. small satellites have 

launched on Russian DNEPR vehicles derived from Russian ICBMs 

and that, by modifying existing U.S. policy, U.S. launch services 

could compete with Russia and bring this business back to America. 

Those in favor also argue that there is a cost to the taxpayer associated with storing excess ICBMs. By allowing the U.S. commercial launch industry to use excess ICBMs, you not only lower the 

tax burden but also create potential revenue derived from the sale 

of these motors. 

Those that oppose the policy change raise legitimate concerns 

that allowing excess ICBMs to be used for commercial launch purposes could distort the market in the United States, undermine future investment, and delay innovations that are on the horizon. 

Access to foreign launch services is also a policy challenge for the 

U.S. small satellite industry. And I’ve heard from a number of companies that build and operate small satellites that there isn’t 

enough capacity in the market at a price they can afford to meet 

their needs. 

India has stepped in and offered to fill, in part, this demand and 

is launching smaller satellites on their PSLV vehicle. The Administration has provided a number of export waivers on a case-by-case 

basis for these launches, in part because India is becoming a strategic ally in South Asia. Unfortunately, the Administration seems 

to lack a clear long-term policy to guide access to PSLV launches. 

What should U.S. policy be with regard to Indian and other foreign 

launch vehicles? 

Another factor that may impact the small satellite market is 

reusability. We all watched with great awe the accomplishments of 

Blue Origin and SpaceX when they launched and recovered their 

first stages. ULA and Ariane are now planning partially reusable 

systems as well. Will partial reusability of launch systems lower 

launch costs significantly and will it be the panacea for small satellite operators? Will they be able to overcome many of the past 

issues with reusability such as refurbishment and maintenance 

costs? Only time will tell, but I’m excited about these recent transformative developments. 

Finally, are there any artificial government barriers to expanding opportunities for secondary payloads, hosted payloads, and 

rideshares? Is there anything that can be done to assist in the aggregation of small satellites on a—on larger vehicles so as to benefit from economies of scale? Are there technologies or policies that 

could allow for greater utilization? 

There is a great deal of promise in the future of space, but if we 

fail to provide long-term solutions to the issues that our nation 
22 

faces, we may well lose our leadership in space. China stands everready to fill that leadership void at a national level. Russia and Europe will gladly fill that role from a commercial perspective once 

again. 

We must provide a competitive legal, policy, and economic environment or other nations will happily step up. This would lead to 

an eroded industrial base, decreased national capabilities, declining 

international influence, and the loss of a skilled workforce. I, for 

one, will not allow that to happen on my watch. 

I look forward to learning more about these critical issues facing 

our commercial space industry and finding common ground and responsible solutions that meet the needs of our nation, grow our 

economy, and maintain our leadership in space. 

[The prepared statement of Chairman Babin follows:] 
23 

For Immediate Release 

April19, 2016 

H 

Media Contact: Zachary Kurz 

(202) 225-6371 

Statement of Space Subcommittee Chairman Brian Babin (R-Texas) 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

Chairman Babin: The commercial space industry truly is an amazing industry. It generates hundreds of 

billions of dollars of economic activity, serving both the private and public sector. all while pushing 

the boundaries of innovation and fostering the United States as the global leader in space. 

Part of this innovation is a new space "spin-in" phenomenon. Computer, data analytics, and IT 

technologies having their origin in our space program but more recently developed outside of the 

space sector are being re-applied for space-specific purposes. Significant research and 

development investments are also being made in the United States to create and manufacture new 

types of small satellite technologies and applications. 

One of the largest barriers that small satellite companies face is the cost of launch. Launch often 

accounts for a significant portion of a small satellite's overall mission cost. Recent government 

incentives for launch vehicle development may allow small satellite operators greater access to 

space. New launch vehicle test flights present great opportunities for small satellite operators to 

launch secondary payloads. if companies were willing to accept the primary payload schedule, 

mission profile, and mission risk. 

The development of a small satellite industry is also attracting investment for a new class of launch 

services to serve the specific needs and requirements of smaller satellites and associated on-orbit 

constellations. A number of American companies. in various stages of development, plan on offering 

dedicated launch services to the small satellite industry in the next few years. These companies hope 

to fulfill the unmet demand of the small satellite market. They also promise to provide more flexible 

launch services such as delivery to unique orbits and rapid replenishment. 

There is a lot of change going on in the small satellite and launch services industry. Winston.Churchill 

once said. "There is nothing wrong with change, if it is in the right direction." From my point of viewthe investment and innovation occurring in the small satellite and launch industry is good for America 

and is an important step in the right direction. 

But change often presents both challenges and opportunities. Companies are seeking to supply the 

demand for greater small satellite launch capability in many unique and innovative ways. Some 

solutions carry more risk than others. Some solutions are easier to implement than others. Some 

solutions require government action. and some do not. Today's hearing gives us the chance to 

explore these challenges and opportunities. 

One policy challenge is excess intercontinental ballistic missiles (ICBM) motors. It is long-standing 

national policy that excess U.S. ICBMs or their components should not be used for commercial launch 

services. This policy is established in the 1998 Commercial Space Act and reiterated in the 2013 

National Space Transportation Policy, which states: "Excess U.S. ballistic missiles [or their components) 

shall either be retained for government use or destroyed," and that departments and agencies may 

use them on a "case-by-case" basis. But should this policy be changed to allow greater use of excess 
24 

ICBM motors for commercial launch services? This isn't a black-and-white issue and the policy 

outcomes associated with either keeping or modifying existing policy will create winners and losers. 

Those in favor argue that many U.S. small satellites have launched on Russian DNEPR vehicles, derived 

from Russian ICBMs, and that by modifying existing U.S. policy, U.S. launch services could compete 

with Russia and bring this business back to America. Those in favor also argue that there is a cost to 

the taxpayer associated with storing excess ICBMs. By allowing the U.S. commercial launch industry to 

use excess ICBMs, you not only lower the tax burden, but also create potential revenue derived from 

the sale of these motors. 

Those that oppose the policy change raise legitimate concerns that allowing excess ICBMs to be 

used for commercial launch purposes could distort the market in the United States, undermine future 

investment, and delay innovations that are on the horizon. 

Access to foreign launch services is also a policy challenge for the U.S. small satellite industry. I've 

heard from a number of companies that build and operate small satellites that there isn't enough 

capacity in the market at a price they can afford to meet their needs. India has stepped in and 

offered to filL in part, this demand and is launching smaller U.S. satellites on their PSLV vehicle. The 

Administration has provided a number of export waivers- on a case-by-case basis -for these 

launches, in part because India is becoming a strategic ally in South Asia. Unfortunately, the 

Administration seems to lack a clear long-term policy to guide access to PSLV launches. What should 

U.S. policy be with regard to Indian and other foreign launch vehicles? 

Another factor that may impact the small satellite market is reusability. We all watched with great 

awe the accomplishments of Blue Origin and SpaceX when they launched and recovered their first 

stages, ULA and Ariane are now planning partially reusable systems as well. Will partial reusability of 

launch systems lower launch costs significantly and be the panacea for small satellite operators? Will 

they be able to overcome many of the past issues with reusability such as refurbishment and 

maintenance costs? Only will time will tell. but I'm excited about these recent transformative 

developments. 

Finally, are there any artificial government barriers to expanding opportunities for secondary 

payloads, hosted payloads, and ride-shares? Is there anything that can be done to assist in the 

aggregation of small satellites on larger vehicles so as to benefit from economies of scale? Are there 

technologies or policies that could allow for greater utilization? 

There is a great deal of promise in the future of space. But if we fail to provide long-term solutions to 

the issues our nation faces, we may well lose our leadership in space. China stands ready to fill that 

leadership void at a national level. Russia and Europe will gladly fill that role from a commercial 

perspective once again. We must provide a competitive legaL policy, and economic environment 

or other nations will happily step up. This would lead to an eroded industrial base, decreased 

national capabilities, declining international influence, and the loss of a skilled workforce. 1, for one, 

will not allow that to happen on my watch. 

I look forward to learning more about these critical issues facing our commercial space industry and 

finding common ground and responsible solutions that meet the needs of our nation, grow our 

economy, and maintain our leadership in space. 

### 
25 

Chairman BABIN. And now, I’d like to recognize the Ranking 

Member, the gentleman from Texas, for an opening statement. 

Mr. VEASEY. Thank you, Mr. Chairman. 

And good morning, and welcome to our distinguished panel of 

witnesses. 

I want to thank Chairman Babin, also a fellow Texan, for calling 

this hearing. 

Before I begin, though, I would like to note that we received the 

final witness testimony statements and the hearing charter less 

than 24 hours ago, and this has made it very tough on member 

preparation and staff preparation likewise. And in the future, I 

hope that we can receive the testimony and charter in a more timely manner. That would be very, very helpful. 

Now, again, as a Texas Member, ensuring the continued growth 

of the space industry and addressing the challenges within emerging sectors such as the commercial launch industry remain incredibly important to me and my fellow committee members. 

Thanks to the Johnson Space Center in Houston, Texas. They 

have long been a leader on space issues. Now, as we move forward 

with commercial spaceflight, Texas is positioned to be a leader yet 

again with a growing presence of commercial tests and launch sites 

in Texas. Companies like Blue Origin and SpaceX are laying the 

groundwork for innovation and helping to inspire the next generation of scientists and engineers with their latest test sites in West 

and South Texas. The work of the private space industry is helping 

change the landscape for satellite launches by greatly driving down 

the cost of delivering a payload safely to space. 

Small satellite, also known as smallsats are contributing to the 

emergence of new startup companies that aim to provide rapid 

turnaround in services and technology advancement to improve 

and expand services at a lower cost, especially in the area of Earth 

observation and data provision. 

U.S. leadership in this emerging industry has the potential to 

both create jobs and economic growth for the nation and to serve 

as an important source of U.S. innovation in an increasingly 

competitve and changing global marketplace. Additionally, universities and government agencies are exploring the increased use of 

smallsats and for research, education and training, technology development, and conduct of government operations. 

One of the major challenges that smallsats do face is developing 

and building the spacecraft—is finding a way to put the spacecraft 

in space and to do so in an affordable and reliable manner. Today, 

options for placing a small payload in space include the following: 

that is, using dedicated small launchers, ridesharing as a secondary payload on a large primarily conducted for another purpose, 

being a hosted payload on a commercial satellite, and being ejected 

from a commercial dispenser mounted on the International Space 

Station. 

Unfortunately, smallsat users and operators are often constrained in their choice of launch options due to individual requirements, available budgets, and the unique characteristics of each option. As a result, smallsat users and operators must make tradeoffs 

between factors such as affordability, schedule, risk, and orbital 

placement. For example, since the primary payload customers dic-
26 

tates launch conditions, users and operators of small satellites 

launched as a secondary payload have no control on either the 

launch schedule or the destination orbit of the launch vehicle. And 

while the secondary payload customers must accommodate any 

delay by the primary payload, they benefit from the lower launch 

cost. 

On the other hand, smallsat customers who place a premium on 

when the launch must occur and to what orbit the satellite needs 

to be placed may opt to launch using a dedicated launch vehicle despite that option’s higher cost. 

So it is not surprising that a number of providers are seizing on 

this opportunity to offer additional launch options to meet existing 

and projected demand by smallsats. Two recent proposals have 

been made. The first is to allow the Air Force to make its excess 

intercontinental ballistic motors available for purchase and later in 

use in commercial launches. The second is to facilitate U.S. commercial satellite operator access to Indian launchers. 

I hope that we can have an objective discussion with the panel 

on the pros and cons of these proposals and identify possible unintended consequences as well. Such a discussion is critical because 

both of these proposals are likely to require changes in statute and 

policy, which this committee would have jurisdiction over. 

However, we also need to hear from the relevant government 

agencies, and I hope Mr. Chairman that we will have the opportunity for a future hearing at which we can get the perspectives of 

affected federal agencies. 

In closing, it is clear that we need a thoughtful discussion of 

these complex issues, one that will enable the United States to capitalize on the innovation and job creation that is sure to come from 

designing and building and using this very exciting technology. 

Thank you, Mr. Chairman, and I yield back the balance of my 

time. 

[The prepared statement of Mr. Veasey follows:] 
27 

OPENING STATEMENT 

Congressman Marc Veasey (0-TX)) 

House Committee on Science, Space, and Technology 

Space Subcommittee 

"The Commercial Launch Industry: 

Small Satellite Opportunities and Challenges" 

Aprill9,2016 

Good morning, and welcome to our distinguished panel of witnesses. 

I want to thank Chairman Babin for calling this hearing. 

Before I begin. Mr. Chairman, I wish to note that we received the final witness testimony 

statements and the Hearing Charter less than twenty four hours ago. This has made Member 

and staff preparation needlessly difficult. In the future, I hope that we can receive testimony 

and the hearing charter in a more timely manner. 

Now, as a Texas member, ensuring the continued growth of the space industry and 

addressing the challenges within emerging sectors such as the commercial launch industry, 

remain incredibly important to me and my fellow committee members. 

Thanks to the Johnson Space Center in Houston, Texas has long been a leader on space 

issues. Now, as we move forward with commercial space flight, Texas is positioned to be a 

leader yet again with a growing presence of commercial test and launch sites in Texas. 

Companies like Blue Origin and SpaceX are laying the groundwork for innovation and 

helping to inspire the next generation of scientists and engineers with their latest test sites in 

West and South Texas. 

The work of the private space industry is helping change the landscape for satellite launches 

by greatly driving down the cost of delivering a payload safely to space. 

Small satellites, also known as smallsats, are contributing to the emergence of new start-up 

companies that aim to provide rapid turn-around in services and technology advancement to 

improve and expand services at a lower cost, especially in the area of Earth observation and 

data provision. 

U.S. leadership in this emerging industry has the potential to both create jobs and economic 

growth for the nation and to serve as an important source of U.S. innovation in an 

increasingly competitive and changing global marketplace. 
28 

Additionally, universities and government agencies are exploring the increased use of 

smallsats for research, education and training, technology development, and conduct of 

government operations. 

One of the major challenges small sat users face, after developing and building the spacecraft, 

is finding a way to put the spacecraft in space, and to do so in an affordable and reliable 

manner. 

Today, options for placing a small payload in space include 

I. Using dedicated small launchers, 

2. "ridesharing" as a secondary payload on a launch primarily conducted for 

another purpose, 

3. being a hosted payload on a commercial satellite, and 

4. being ejected from a commercial dispenser mounted on the International 

Space Station. 

Unfortunately, smallsat users and operators are often constrained in their choice of launch 

options due to individual requirements. available budgets, and the unique characteristics of 

each option. As a result, smallsat users and operators must make tradeoff's between factors 

such as affordability, schedule, risk, and orbital placement. 

For example, since the primary payload customer dictates launch conditions, users and 

operators of small satellites launched as a secondary payload have no control on either the 

launch schedule or the destination orbit of the launch vehicle. And while secondary payload 

customers must accommodate any delay by the primary payload, they benefit from the lower 

launch costs. 

On the other hand, smallsat customers who place a premium on when the launch must occur 

and into what orbit the satellite needs to be placed may opt to launch using a dedicated 

launch vehicle--despite that option's higher costs. 

So it is not surprising that a number of providers are seizing on this opportunity to offer 

additional launch options to meet existing and projected demand by smallsats. 

Two recent proposals have been made. 

The first is to allow the Air Force to make its excess Intercontinental Ballistic Missile motors 

available for purchase and later use in commercial launches. 

The second is to facilitate U.S. commercial satellite operator access to Indian launchers. 

l hope that we can have an objective discussion with the panel on the pros and cons of these 

proposals, and identify possible unintended consequences as well. Such a discussion is 
29 

critical because both of these proposals are likely to require changes in statute and policy, 

which this committee would have jurisdiction over. 

However, we also need to hear from the relevant government agencies, and I hope, Mr. 

Chainnan, that we will have the opportunity for a future hearing at which we can get the 

perspectives of the affected federal agencies. 

In closing, it is clear that we need a thoughtful discussion of these complex issues, one that 

will enable the U.S. to capitalize on the innovation and job creation that is sure to come from 

designing, building, and using this exciting technology. 

Thank you, and I yield back the balance of my time. 
30 

Chairman BABIN. Thank you, Mr. Veasey. I appreciate it. 

I would like to thank the witnesses for being here today, and I’d 

like to introduce them. As you may know, last week was the 32nd 

Space Symposium in Colorado. Both of our witnesses have been extremely busy preparing for and attending the symposium, and so 

I very much appreciate that they were able to pull together their 

testimonies and attend this hearing on such a short notice and 

short turnaround. 

The committee received a number of letters from stakeholders, 

and I ask unanimous consent to include them in the record. 

[The information follows:] 
31 

The referenced document was not provided at the time of printing. 
32 

Chairman BABIN. And let me introduce our witnesses. 

First is Mr. Elliott Pulham, our first witness today. He’s the 

Chief Executive Officer of the Space Foundation since 2001. In his 

role at the Space Foundation, Mr. Pulham leads a premier team of 

space and education professionals, providing services to educators 

and students, government officials, news media, and the space industry around the world. 

Before joining the Space Foundation, Mr. Pulham was Senior 

Manager of Public Relations, Employee Communication, and Advertising for all space programs of Boeing, serving as spokesperson 

at the Kennedy Space Center for the Magellan, Galileo, and Ulysses interplanetary missions, among others. Mr. Pulham has a degree in journalism and mass communication from the University of 

Hawaii Manoa. 

Second, Mr. Eric Stallmer, and we appreciate Mr. Stallmer being 

here today as well. He’s President of the Commercial Spaceflight 

Federation since 2014. In his role, Mr. Stallmer constantly promotes the industry and member companies through his outreach of 

high-ranking officials and high-profile media outlets. He also promotes the mission of CSF through participation in multiple industry conferences throughout the year. 

Mr. Stallmer, has a master of arts degree in public administration from George Mason University and a bachelor of arts degree 

in political science and history from Mount St. Mary College. 

I now recognize Mr. Pulham for five minutes to present his testimony. 

TESTIMONY OF MR. ELLIOT PULHAM, 

CHIEF EXECUTIVE OFFICER, SPACE FOUNDATION 

Mr. PULHAM. Thank you, Mr. Chairman, and thank you, Members of the Committee. It’s a pleasure to be here today, and I thank 

you for the opportunity to testify on matters having to do with the 

space launch and satellite markets. 

In addition to my testimony, I’d like to enter into the record a 

brief report on these markets, which is gleaned from our online research source, ‘‘The Space Report,’’ which has been included as an 

addendum to my remarks. 

I’m here today to provide perspective and data on behalf of the 

foundation. We’re a 501(c)(3) nonprofit, nongovernmental organization, and we strive to be an entity that all stakeholders in the 

space policy realm can trust to provide fair, balanced, and well-researched information. 

The easiest way to characterize the current international launch 

market is that it is highly competitive, abundantly supplied with 

a variety of launch systems, and with new systems and suppliers 

entering or attempting to enter the market virtually every day. In 

2015, there were 39 different major launch vehicle models in operation, 39, and they accounted for 86 launches around the world. In 

simple math, this is less than three launches per vehicle, which is 

not commercially sustainable, and it means that some systems 

enjoy a backlog of orders while many, many launches depend upon 

government involvement of one kind or another. 

Regarding the notion of permitting or prohibiting access to foreign launch services, our experience is it’s very hard to characterize 
33 

levels of government support for many competing systems because 

of the different cultures, economies, types of government, perceived 

societal roles, and so forth. But it is safe to say that there are very 

few launch systems in the world that have not has some kind of 

government support at one time or another, although I think this 

is certainly beginning to change with the advance in small commercial launch vehicles. 

The issues I think before us have to do with fairness to the satellite manufacturers of the United States and our allies, reasonable 

access to launch options, and attention to security concerns that do 

not constitute a broad or overly restrictive reach by regulators. 

The impact of ITAR restrictions over the past 20 years has mostly been a body of unintentional consequences that have injured 

U.S. satellite manufacturers while promoting the development of 

so-called ITAR-free and no-U.S.-content satellites in Europe and 

Asia. Many of the satellite orders, once routinely filled by U.S. companies, are now filled by others. Even good friends and allies who 

really, really would like to buy American find themselves frustrated still. Significant changes to ITAR have been made, but implementation of the changes within the government has been slow. 

Recently, there’s been some discussion about allowing U.S.-built 

satellites to fly on boosters such as the Indian PSLV. This kind of 

discussion has taken place before in the case of allowing U.S.-built 

satellites to fly on Chinese boosters, which was permitted but came 

to an end in the late 1990s with the failure of a Long March booster and the subsequent accident investigation, which resulted in the 

ITAR changes mentioned. Since then, no U.S. satellites have flown 

on Chinese boosters. 

I think the concern about using Indian boosters is not so much 

the transfer of sensitive technology to a nation that’s a fellow democracy, but rather whether the Indian launches are subsidized by 

the government to a degree that other market actors would be 

priced out of the market. I would point to the chart that in my testimony that shows the launch rates for the past decade. India has 

not managed to launch more than a half a dozen times the year. 

They’ve also had some reliability challenges with their systems, 

and I do not see them as a clear and present danger to U.S. 

launchers quite yet. 

Within the boom in small satellites, there is also a boom in the 

development of launchers dedicated to the small side—CubeSat, 

nanosat, whatever you want to call them—market. The boom has 

numeric interest, but its market impact remains to be seen. The 

total mass of nanosatellites launched in 2015 only equals one percent of the total mass launched. If it were not for the unique orbits 

required for various small satellite missions, all 120 of the 

nanosats launched in 2015 with a combined mass of less than 500 

kilograms could have been orbited on a single Delta II launch vehicle. 

As regards to these new constellations that we’re seeing, we’ve 

seen a similar story before when forecasts for thousands of new 

small satellites were envisioned for systems like Teledesic, which 

I had some experience with. These led to wildly ambitious launch 

forecasts in the ’90s, which did not materialize and have had a negative impact on national security space ever since. 
34 

Then, as now, there was enthusiasm for the spin-in of technology 

and management architectures from the non-space world. But 

space was and is hard. The ability to succeed in cellular communication did not translate into success in the satellite marketplace 

in the ’90s, nor does acumen in information technology necessarily 

equate to satellite success today. Many of the investments being 

made in small satellites are driven simply by the smaller costs of 

the spacecraft. Small cost and big capabilities seldom arrive handin-hand. 

The other major policy considerations that accompany this proliferation of small satellites has to do with the necessity of getting 

our arms around a space traffic management regime which will ensure continued long-term access to space for operators of all sizes. 

And I’m sure you’ve all heard the three C’s. Space is congested, 

contested, and competitive, and it’s only getting more so. 

I don’t want you to think that I’m not excited about this emerging sector or that it’s necessarily doomed to the fate of the Little 

LEO phenomena of the ’90s, but rather I’m saying we need to be 

cautiously optimistic and not overly bullish. At a recent House 

Armed Services Committee, General Hyten said it was incredibly 

difficult for the government to accurately forecast launch industry 

trends and say with certainty where the industry will be several 

years from now, and I would say it’s difficult for anyone to do that. 

Technology improvements have resulted in better components, 

less expensive technology. I’m not saying it’s not as good as the 

other satellite stuff that’s out there. And the emerging players do 

offer technology advances such as rapid iteration, constantly increasing communication speed, bandwidth, et cetera. These capabilities may in many cases be complementary with legacy companies, products, and services. Pentagon’s recent outreach to Silicon 

Valley speaks to the recognition that there are new things to be 

learned. 

Partially or fully reusable launch vehicles have been the Holy 

Grail in the space sector for ages. It is delightful to see progress 

being made towards reusability. 

And then wrapping up because I’ve abused my time, I just want 

to finally address an issue that is larger than the focus of today’s 

hearing, which is the future of the country in space and how we 

ensure U.S. leadership in space. Last month, the Space Foundation, along with 13 other space-related associations, including Mr. 

Stallmer’s, released a paper, ‘‘Ensuring U.S. Leadership in Space.’’ 

The document is intended to be a nonpolitical statement from the 

space industry to inform candidates for office and educate them of 

how important and essential space efforts, technologies, and capabilities are for all Americans. I encourage you to read this document and ask that you insert it in the record of this hearing. 

Again, thank you for allowing me to go a little bit over my time, 

and I look over to your questions. 

[The prepared statement of Mr. Pulham follows:] 
35 

1 Testimony of Elliot Holokauahi Pulham 

2 Chief Executive Officer, the Space Foundation 

3 House Science, Space, & Technology Committee, Subcommittee on Space 

4 U.S. House of Representatives 

5 Aprill9, 2016 

6 "The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges" 

7 

8 Chairman Babin, Ranking Member Edwards, Committee Members, Friends, and Staff, on behalf 

9 of the Space Foundation Board of Directors and the entire Space Foundation team, I thank you 

10 for the opportunity to testify today on matters having to do with the space launch and satellite 

11 markets. In addition to my testimony, I would like to enter into the record a brief report on these 

12 markets gleaned from our online research source, The Space Report, included as an addendum to 

13 my remarks. 

14 

15 I am here today to provide data and perspective on behalf of the Space Foundation, a 50l(c)(3), 

16 nonprofit, nongovernmental organization. The Space Foundation strives to be an entity that all 

17 stakeholders in the space policy realm can trust to provide fair, balanced and well-researched 

18 information, and to help educate and advise, consistent with our mission: "To advance space19 related endeavors to inspire, enable and propel humanity." 

20 

21 Last week in Colorado Springs, Colorado, we held the 32"d Space Symposium, the largest single 

22 space gathering in the world. More than I 0,000 space professionals from all over the globe came 

23 together to talk policy and conduct business. I can say the energy at the Space Symposium 

24 speaks to the dynamism we arc seeing the in the space industry. 

25 

26 The easiest way to characterize the current international launch market is that it is highly 

27 competitive and abundantly supplied with a variety of launch systems, with new systems and 

28 suppliers entering, or attempting to enter the market, virtually every day. In 2015 there were 39 

29 different launch vehicle models in operation, accounting for 86 launches around the world. In 

30 simple math this is less than three launches per vehicle, which is not commercially sustainable 

31 and means that some systems enjoy a backlog of orders, while many, many launches depend 

32 upon government involvement of one kind or another. 
36 

33 

34 Regarding the notion of permitting or prohibiting access to foreign launch services, our 

35 experience is that it is very hard to characterize levels of government support for the many 

36 competing systems, because of the many different cultures, economies, types of government and 

37 their perceived societal roles, etc. It is safe to say that there are very few launch systems in the 

38 world that have not had some kind of government "support" or another over time, although this 

39 is beginning to change with some of the small commercial launch vehicles. The issues, I think, 

40 are fairness to the satellite manufacturers of the U.S. and our allies, reasonable access to launch 

41 options, and attention to security concerns that do not constitute a broad or overly restrictive 

42 over-reach by regulators. 

43 

44 The impact of IT AR restrictions over the past 20 years has mostly been a body of unintentional 

45 consequences that have injured U.S. satellite manufacturers while promoting the development of 

46 so called "!TAR Free" and "No U.S. Content" satellites in Europe and Asia. Many of the satellite 

47 orders once routinely filled by U.S. companies are now filled by others.Even good friends and 

48 allies, who really, really would like to buy American, find themselves frustrated and buying 

49 elsewhere. Significant changes to IT AR have been made, but implementation of the changes 

SO within the U.S. Government has been excruciatingly slow. 

51 

52 In terms of launch pricing, foreign launch providers that are keen to create viable commercial 

53 space businesses will price as close to the top of market values as possible. It is in their interest 

54 to profit. Where you have disparity is in clearly government owned systems with no private 

55 investment. They have no profit motive, and one must, in each case, ask what the motive is. 

56 

57 Specifically, there has been some recent discussion about allowing U.S.-built satellites to fly on 

58 boosters such as the Indian PSLV. This kind of discussion has taken place before, in the case of 

59 allowing U.S.-built satellites to fly on Chinese boosters. This was permitted but came to an end 

60 in the late 1990s with the failure of a Long March booster and the subsequent accident 

61 investigation, which resulted in the IT AR changes already mentioned. Since then, no U.S. 

62 satellites have flown on Chinese boosters. 

63 

2 
37 

64 The concern about using Indian boosters is not so much the transfer of sensitive technology to a 

65 nation that is a fellow democracy, but rather whether Indian launches are subsidized by the 

66 Indian government to the degree that other market actors, for example American launch 

67 companies or those of allies, would be priced out the market. I would point to the chart that 

68 shows launch rates for the past decade. India has not managed to launch more than half a dozen 

69 times a year. They've also had some reliability challenges with their systems. I do not see India 

70 as a clear and present danger to U.S. launchers quite yet. 

71 

72 

U.S. Launches 

20 

JS 

10 

2COli 2001 2008 2009 2011 2012 2013 2014 

l!lll U S. Non-comnwrCJai wu 

73 

Indian launches 

7007 

I I I I I I /008 7009 2010 2012 2011 2014 201S 

W indld Non,cornnwrnd! JW: !nd:.a Comnwrcidi 

74 

3 
38 

75 

76 Demand for commercial satellites remains high, and the major operators continue to add 

77 capabilities and mass to their geostationary spacecraft. We are seeing an emerging sweet spot for 

78 what I would call small-"ish'' satellites, special purpose spacecraft built at the size of a hotel 

79 refrigerator, and really well tuned to a specific task and, usually, a unique orbit. 

80 

81 With the boom in small satellites, there is also a boom in the development of launchers dedicated 

82 to the small sat, cubesat or nanosat market. This boom has numeric interest, but its market impact 

83 remains to be seen. The total mass of nano satellites launched in 2015 only equals one percent of 

84 the total mass launched. If it were not for the unique orbits required for various small satellite 

85 missions, all 120 of the nano sats with a combined mass of less than 500kg launched in 2015 

86 could have been orbited on a Delta II. 

87 

11 Large (1 ~'01-4000 kr.() 

Source. Eurospace LEAT data, 

v1a The Space Report 

88 In the space economy, space transportation only accounts for one or two percent of total global 

89 space revenues per year, and the small sat segment only one percent of that. The technological 

90 advances we have seen in the past twelve months alone are astonishing. Constellations of small 

4 
39 

91 satellites will no doubt be a viable market for some, and we encourage you to support it, but not 

92 to over react to it. 

93 

94 We've seen a similar story before, when forecasts for thousands of new, small satellites, 

95 envisioned for constellations like Teledesic, led to wildly ambitious launch forecasts in the 1990s 

96 - forecasts that did not materialize and have had a negative impact on national security space 

97 launch capacity ever since. Then, as now, there was enthusiasm for the spin-in of technologies 

98 and management architectures from the non-space world. But space was, and is, hard. The ability 

99 to succeed in cellular communications did not translate into success in the satellite marketplace 

100 then, nor does acumen in information technology necessarily equate to satellite success today. 

101 Many of the investments being made in small satellites today are driven simply by the smaller 

102 costs of these diminutive spacecraft. Small cost, and big capability, seldom arrive hand in hand. 

103 There are other major policy considerations that accompany the proliferation of small satellites104 including the necessity of getting our arms around a space traffic management regime which will 

105 ensure continued long term access to space for operators of all sizes. 

106 

107 I do not want the committee to think that I am saying that this new flurry of emergent space 

108 systems is doomed to the same fate of the "Little LEO" phenomena of the 1990s, but rather I am 

109 saying we need to be cautiously optimistic and not be overly bullish. At a recent House Armed 

110 Services Committee hearing, Air Force Space Command Commander, General John Hyten 

111 stated that it was incredibly difficult for government to accurately forecast launch industry trends 

112 and say with certainty where the industry will be several years from now. The industry cannot 

113 accurately forecast the future trends, either, in fact- which is why we don't try. What we at the 

114 Space foundation endeavor to do is to synthesize data to show historical trends. Government 

115 policy should not become based on forecasts and predictions that in hindsight may be found to be 

116 off the mark. Instead, policies should enable all space companies to operate with the least 

117 amount of intrusive regulation and maximum ability to operate successful businesses. 

118 Technology improvements since the 1990s have resulted in components becoming less 

119 expensive and utilized in new emerging satellite systems. I am not saying this technology is just 

120 as good as the most exquisite imagery or communications satellites out there, but it is good 
40 

121 enough for a market they think can exist and are trying to address. Emerging players in the 

122 satellite field offer technology advances such as rapid iteration, constantly increasing 

123 communications speeds and bandwidth, imagery resolution, and data integration. We have heard 

124 that these capabilities may be in many cases complementary and compatible with legacy 

125 companies' products and services. I think the Pentagon's recent outreach to Silicon Valley 

126 speaks to the recognition that there are new things to be learned. 

127 Partially or fully reusable launch vehicles have been the "holy grail" of the space transportation 

128 sector for decades. We're seeing great work being done, and the economic models are promising. 

129 Again, however, this is harder than it looks. Our only true data point on a partially reusable 

130 system is the Space Shuttle program, a wonder of engineering that proved much more costly, and 

131 difficult, than originally imagined. We are seeing tremendous work on reusability, mostly borne 

132 by private investment, but the ultimate viability of these systems and their impact on overall 

133 launch costs remains to be seen. I believe these systems will prove their worth, but we have 

134 miles to go. I am excited to continue to watch the developments on the reusability front. 

135 

136 Finally, I want to address an issue that is larger than the focus oftoday's hearing. Last month the 

137 Space Foundation, along with 13 other space-related associations, including my colleague 

138 organization the Commercial Spaceflight Federation, with me here today released "Ensuring 

139 U.S. Leadership in Space." This document is intended to be an apolitical statement from the 

140 space industry to primarily inform the candidates for president as well as other candidates for 

141 elected office to educate them how important and essential space efforts, technology and 

142 capabilities are for all Americans. I encourage you all, as leaders in driving U.S. space policy, to 

143 be familiar with this document. Even if you may not have a direct "space constituency," for 

144 example a NASA center in your district, the people you diligently represent depend on space 

145 every single day. I would ask that you insert this document for the record of this hearing. 

146 

147 I thank the Committee and staff for the opportunity to testify today, and look forward to your 

148 questions. 

149 # # # 

6 
41 

Elliot Holokauahi Pulham 

Space Foundation Chief Executive Officer 

Named chief executive officer of the Space Foundation in 2001, Elliot Pulham leads a 

premier team of space and education professionals providing services to educators and 

students, government officials, news media and the space industry around the world. He is 

widely quoted by national, international and trade media in their coverage of space activities 

and space-related issues. 

Before joining the Space Foundation, he was senior manager of public relations, employee 

communication and advertising for all space programs of Boeing, serving as spokesperson at 

the Kennedy Space Center for the Magellan, Galilee and Ulysses interplanetary missions, 

among others. 

He is a recipient of the coveted Silver Anvil Award from the Public Relations Society of 

America -the profession's highest honor. In 2003, the Rotary National Awards for Space 

Achievement Foundation presented him with the coveted Space Communicator Award, an 

honor he shares with the late legendary CBS News Anchor Walter Cronkite and former CNN 

News Anchor Miles O'Brien. 

Pulham is chairman of the Hawaii Aerospace Advisory Committee, a former Air Force Civic 

Leader and advisor to the Chief of Staff and Secretary of the Air Force and a recipient of the 

U.S. Air Force Distinguished Public Service Medal. He serves on the editorial board of New 

Space Journal. 

Space Foundation 

4425 Arrowswest Drive • Colorado Springs. Colo. 80907 • +1.719.576.8000 • +1.800.691.4000 

www.SpaceFoundationorg 
42 

Chairman BABIN. Yes, sir. Thank you, Mr. Pulham. I appreciate 

that. 

And I would now like to recognize Mr. Stallmer for five minutes 

for his testimony presentation. 

TESTIMONY OF MR. ERIC STALLMER, PRESIDENT, 

COMMERCIAL SPACEFLIGHT FEDERATION (CSF) 

Mr. STALLMER. Thank you, Chairman Babin, and Members of the 

Subcommittee, and thank you for holding this hearing today. 

The Commercial Spaceflight Federation is the leading national 

trade association for the commercial spaceflight industry. Our 

members are responsible for the creation of thousands of high-tech 

jobs driven by billions of dollars of investment. Through the promotion of innovation, CSF is guiding the expansion of Earth’s economic sphere, bolstering U.S. leadership in aerospace, and inspiring America’s next generation of engineers and explorers. 

As the commercial space industry experiences rapid growth in 

demand, the U.S. launch industry is responding. Presently, the 

U.S. launch services market is dealing with demand in three ways. 

First, companies are investing a substantial—substantial capital in 

the development of a new class of small launch vehicle systems, including Virgin Galactic, Firefly, Vulcan, and Rocket Lab; second, 

through bundled satellite deals on dedicated medium to intermediate lift rockets with SpaceX, and soon, Blue Origin and Sierra 

Nevada’s Dream Chaser; and finally, through secondary payloads. 

Companies with small satellites piggyback on larger satellite 

launches. PlanetLabs, with its large constellation of small remote 

sensing satellites, has flown to orbit as a secondary customer on a 

number of flights already. 

While small satellite customers benefit from being a secondary 

payload through fractional pricing, we acknowledge that the status 

as a secondary payload does result in tradeoffs for the small satellite customer. The best solution for access to space for small satellite companies would be when they’re dedicated U.S. small launch 

providers coupled with options for bundled launch services on larger rockets and more opportunities to ride to space as secondary 

payloads. 

With the growth in demand for domestic space launch, the need 

in the near term for the state-of-the-art launch facilities is really 

necessary. There are numerous spaceports that are well-positioned 

to support existing and new launch vehicles that are coming online. 

The more U.S. launch vehicles available will provide more opportunities to access space from our many spaceports. 

And even as the ink is still wet on last year’s Space Act, Congress is now facing efforts to reverse decades of sound policy with 

respect to the commercial use of ICBM assets. The vast majority— 

but I will note not all of CSF’s 70 member companies—oppose the 

efforts to reverse this policy. There are some in the DOD and the 

defense industry that are advocating for releasing old ICBM rocket 

motors for use in the commercial marketplace. Those advocating for 

this changes seek to buy the rocket motors at substantial discount 

and then compete against U.S. companies that have developed 

their own launch capabilities using private capital investment. 
43 

This proposal is counter to the longstanding U.S. law and policy. 

Wholesale conversion of ICBMs into space transportation vehicles 

risks placing the government in the position of competing with the 

private sector. It could have long-term consequences, and we’ve 

seen this in the past. Such behavior risks undermining investor 

confidence as well. 

By consistently reaffirming 30 years of U.S. commercial launch 

policy, improving regulatory stability, and promoting pro-growth 

policies, the United States Government has fostered a healthy development of the U.S. commercial launch industry, and we’re seeing this policy bear fruit today. CSF encourages this committee to 

pose any changes to the existing policy with respect to the commercial use of ICBM assets, the reasons that I’ve outlined in my written testimony. 

CSF also opposes efforts to facilitate a government-subsidized 

foreign launch company—in this case India—to compete with U.S. 

companies. Such policy runs counter to many national priorities 

and undermines the work and investment that has been made by 

the government and industry to ensure the health of the U.S. commercial space launch industrial base. 

At the same time, we have to be cautious not to squeeze out the 

U.S. satellite manufacturers and the operators that have immediate launch needs which cannot be served by the aforementioned 

U.S. commercial launch vehicles that will be coming online later 

this year. 

If it can be shown that there is no viable U.S. launch opportunities in the given time frame to a required orbit, launches on Indian 

vehicles should continue to be considered on a case-by-case waiver 

review for U.S. payloads, as has been the practice for the last several years. This practice should continue while still relevant but 

with the knowledge that this is definitely a temporary solution. 

In conclusion, on behalf of my 70 member companies, I appreciate the opportunity to testify in front of you today. American industry is responding to market demands and innovating on new 

technologies and outpacing any other country in the world. We seek 

to preserve this national leadership in space, and we look forward 

to working with this Congress to achieve these goals. 

I look forward to your questions. 

[The prepared statement of Mr. Stallmer follows:] 
44 

Testimony of Eric StaHmer 

President, Commercial Spaceflight Federation 

House Committee on Science, Space & Technology 

Subcommittee on Space 

Hearing on "The Commercial Space Launch Industry: Small Satellite Opportunities and 

Challenges" 

Tuesday, Apri119, 2016 

Chairman Babin, Ranking Member Edwards, and Members of the Subcommittee, thank you for 

holding this timely hearing on the commercial space launch industry and for providing me the 

opportunity to testify as President of the Commercial Spaceflight Federation. 

The Commercial Spaceflight Federation (CSF) is the leading national trade association for the 

commercial spaceflight industry. Founded in 2006, CSF and its more than 70 members are laying 

the foundation for a sustainable space economy and democratizing access to space for scientists, 

students, civilians, and businesses. CSF members are responsible for the creation of thousands of 

high-tech jobs driven by billions of dollars in investment. Through the promotion of technology 

innovation. CSF is guiding the expansion of Earth's economic sphere, bolstering U.S. leadership 

in aerospace, and inspiring America's next generation of engineers and explorers. 

My testimony will focus on three key areas. First, I will provide an overview of key economic 

trends and investments in the commercial spaceflight industry, including existing and new 

markets associated with satellite telecommunication and demand for launch services in this 

sector; and the burgeoning industry around small satellite technology for telecommunication, 

remote sensing, scientific research, resource extraction, and space exploration, as well as demand 

for launch services and launch capacity in this segment. Second, I will focus on new 

technologies-all financed largely by private investment-that are reducing the cost of access to 

space, including reusable launch vehicle systems and small launchers. Third, I will outline key 

policy challenges facing the commercial spaceflight industry, such as reversing sound policy with 

regard to the use of excess ICBMs for commercial launches that would stunt the growth of 

emerging commercial sectors, and offer consensus industry recommendations to the Committee. 

The Commercial Space Industry Today 

The commercial space industry today is a robust and growing technology sector focused on 

innovation and providing capacity to new markets based on existing and emerging satellite and 

human spaceflight systems. In our view, the commercial space launch industry can be broken into 

three core markets: 

I. Existing geostationary (GSO) satellite telecommunications market. The market for 

traditional telecommunications satellite carriage is mature, stable, and predictable. 

2. Existing and emerging non-geostationary (NGSO) satellite market, including 

telecommunications, remote sensing, scientific research, cargo and crew carriage to LEO, 

and others. Here, the market for traditional NGSO launch is predictable, but new satellite 

constellations and new dedicated launch systems are emerging as the market expands. 

1 
45 

3. Commercial Human Spaceflight This includes space tourism, including suborbital 

spaceflights aboard Virgin Galactic's SpaceShipTwo, Blue Origin's New Shepard, 

XCOR's Lynx, and near-space on World View Enterprise's Voyagers; commercial space 

habitats, such as those developed by Bigelow Aerospace; and others. 

These new and existing markets are driving substantial private capital investment into the U.S. 

space sector. In 2015, the commercial space industry saw historic levels of private capital 

investment and market growth. According to a recent report by the Tauri Group, "More than 50 

venture capital firms invested in space deals in 2015, the most in any year during the 15-year 

study period (2000-20 !5)."1 These investments totaled$ 1.8 billion in venture capital, and nearly 

$2.7 billion in total investment and debt financing, according to this report. 2 This investment is 

significant and reflects continued confidence in the market, which, according to the Tauri Group, 

has committed more than $13.3 billion in investment (including debt financing) since 2000. 

Moreover, it seems like every day there is news of another significant technological breakthrough 

in the commercial space industry. Just to highlight a few: 

I. In November 2015, Blue Origin demonstrated a successful launch and landing of its New 

Shepard rocket, and has since launched and landed the same rocket two more times, in 

January and ApriL 

2. In December 2015, SpaceX successfully launched ll Orbcomm OG2 satellites (built by 

Sierra Nevada Corporation) into Low Earth Orbit (LEO), and subsequently landing the 

first stage of the Falcon 9 rocket on its Landing Zone l at Cape Canaveral Air Force 

Station. Just two weeks ago, SpaceX successfully landing its first stage booster on its 

autonomous spaceport droneship after successfully deploying its Dragon spacecraft to 

orbit, and plans to re-fly this stage in the coming months. 

3. On Saturday of last week, astronauts aboard the International Space Station (ISS) 

successfully attached the Bigelow Aerospace Expandable Module (BEAM) to the ISS 

using the Sierra Nevada Corporation's Berthing Mechanism, following its launch inside 

of the trunk ofSpaceX's Dragon spacecraft. 

4. Virgin Galactic unveiled its SpaceShipTwo suborbital vehicle, VSS Unity on February 

19, 20!6 and plans to launch its orbital small launch vehicle, Launcher One in2017. 

5. Virgin Galactic, Masten Space Systems and Blue Origin are supporting DARPA's XS-1 

program. 

6. Planetary Resources deployed its first spacecraft, and will be deploying two more this 

year, AGI won its first space command contract with the U.S. government, and Spaceport 

America unveiled the "Spaceport America Experience.'' 

7. Moon Express, World View Enterprises, Vulcan Aerospace, XCOR Aerospace, and 

Sierra Nevada Corporation have all announced plans to begin flight operations in the next 

couple of years. 

1 Tauri Group. httpJ space.taurigroup,com:reJ2(.\[IS--''i!at:L\~p_5jXt£.,J2<:lf 

'Tauri Group. http:/ spacc.taurigroup.eom reports Start_Up_Space.pdf 

2 
46 

This is an exciting time for the U.S. space industry, with technological advances being 

demonstrated nearly every day, significant investment by the private sector, unique public-private 

partnerships with the U.S. Government, and the onset of new space-based technologies, including 

commercial remote sensing and broadband internet service. Existing U.S. law and policy, 

including the National Space Transportation Policy, the Commercial Space Launch Act, which 

facilitates and encourages a robust domestic space launch and space systems industry, are clearly 

bearing fruit. As I discuss below, now is exactly the wrong time to reverse these policies, which 

have been decades in the making. 

The Commercial GSO Market 

The market for traditional commercial geostationary satellites has remained relatively robust and 

stable for the last several decades. The satellite industry experiences persistent annual growth and 

represents more than $195B in revenues per year, driven primarily by proven demand for 

telecommunications provided by satellites in geostationary orbit. Here, the accessible 

geostationary transfer orbit (GTO) launch market-meaning the market available open to 

competition from U.S. launch services providers-represents $2.0 billion to $2.5 billion in 

revenues per year, and roughly 20-25 satellite launches. 

According to a 2015 report from the Federal Aviation Administration (FAA), which annually 

assesses and forecasts the global space launch market, "The GSO market remains stable with a 

projected demand of25 satellites per year for the period 2015 2017, up from last year's average 

of22.3 for the period 2014 20 16.") 

The commercial GTO launch market is a good news story for the United States and U.S. 

competitiveness worldwide. [n 1980, for example, the U.S. dominated this market with 100 

percent market share. By 2010, however, America's share of the market had collapsed to 0 

percent, reflecting the impact of U.S. policies through which the Government competed directly 

against commercial firms (e.g. commercial payloads on Space Shuttle) and price noncompetitiveness from existing U.S. providers relative to foreign competition. As a result, foreign 

launch service providers such as Arianespace out of Europe and International Launch Services 

(ILS) out of Russia came to dominate the market entirely. 4 

However, a reversal of the foreign dominance of space launch in this market is underway, 

primarily due to evolutionary and revolutionary innovations taking place by U.S. space launch 

services sector. For example, SpaceX, which began offering its Falcon 9 commercial launch 

service in 2012, has unilaterally recaptured 60 percent of the global commercial satellite market 

in 2016. Space X 's entry into the market with reliable, affordable space launch services has 

prompted a major restructuring of Europe's space launch sector5

, and Russia is also making 

1 FAA AST. "2015 Commercial Space Transportation Forecasts." Pg 2. Source: 

https: ·· \\\\\\. tim.guv about/otlic.:_org·hcadquartcrs_oflkcs ast/!)1edia/('omm\.~r~iaf_Spacc_ Transpprtati~1n_ 

Forccasb_20 1.' .pdf' 4 Exploring the Unknown: Selected Document in the flistory of the L'.S. Civil Space Program; Volume IV: 

Accessing Space; Edited by John M. Logsdon, with Ray A. Williamson, Roger D. Launius, Russell J. 

Acker, Stephen J. Garber, and Jonathan L. Friedman. Page 418. Source: ht:tp)~l!istorv.f)as~JillYOif': 

H07 .vol4 CO\Cf.11Sif 

5 Hepher, Tim. "Airbus, Safran team up on response to SpaceX: sources." Reuters. 15 june 2014. 

Source: http:/ jw,v\v.t:c-uters,comj<lrtt~lc/us-airb!ls-gr()ttp:s<lfr~m-_ldlJSK.BNOJ'-Ql22.2_QJ40(,.1(, 

3 
47 

drastic changes to reduce pricing in order to become more competitive." ULA, and other U.S. 

launch providers, have also followed suit by partnering with Blue Origin and XCOR to integrate 

innovative engine technology into their future launch vehicles. The promise of reusability has the 

potential to fundamentally alter the economics of space launch, if realized. 

The NGSO Market 

The NGSO market today is comprised largely of cargo resupply flights to the International Space 

Station (ISS), and, by 2018, the addition of crew flights using U.S. launch vehicle systems and 

spacecraft to service the ISS through NASA's Commercial Crew Program. These missions utilize 

existing medium- to intermediate-class rockets, specifically the SpaceX Falcon 9, Orbital A TK's 

Antares, and the United Launch Alliance (ULA) Atlas V. 

In addition to ISS commercial transportation services, the existing NGSO market today is 

comprised of constellations of satellite systems to provide, for example, machine-to-machine 

(M2M) data messaging service, i.e. Orbcomm; telecommunications through the deployment of 

the IridiumNext constellation, GlobaiStar, and 03b, among others; commercial remote sensing 

satellites, including PlanetLabs, Terra Bella (formerly Skybox Imaging), DigitalGlobe, Planetary 

Resources CERES constellation, and a number of others; and new mega-LEO constellations to 

support broadband internet such as One W cb. 

According to the FAA, "The demand for commercial NGSO launches is expected to be at a 

comparably high level as major NGSO telecommunication constellations are replenished and 

NASA ISS commercial crew and cargo resupply missions become more regular." 7 

In addition to dedicated flights on medium- to intermediate- lift launch vehicles, a new and 

rapidly-growing market of small satellite deployment has emerged via brokering and bundling of 

secondary launches, which in turn has ignited a commercial demand for smaller commercial 

launch vehicles to provide a dedicated launch service. Dedicated small launch capability being 

developed by multiple U.S. companies are scheduled to come online in the next 2 years, with 

many companies already manifesting flights. These companies, once fully operational, will 

launch 12-24 times a year. 

The U.S. launch vehicle industry is seeing hundreds of millions of dollars of private sector 

investments, particularly in the last several years. This investment is driving innovations and 

technologies to develop launch vehicle systems, stati new companies, and create high-paying jobs 

across the United States. 

These developments should be celebrated and encouraged through sound U.S. policy. Until very 

recently, the space business has been somewhat limited to government agencies and large 

corporations-and innovation in technology has been static while launch costs have been highthe inverse of Moore's Law. The onset of new firms driving down the cost of space launch and 

6 Bodner, Matthew. "Russia vs. Elon Musk: U.S. Startup Threatens Moscow's Role in Space." The 

Moscow Times. 14 April2016. Source: 

http:jjwww.themoscowtimes.com/business/articlef.S65756.html 

7 FAA AST. "2015 Commercial Space Transportation Forecasts." Pg 3. Source: 

https !.vv wvv, t~a. goLgb()tt.tioftl .:e _ or&heaclq U<tr.tcrL_ oftlcc.sia~t IJle_{l i a <: ()lll!l1~t:<:llil_~.fl.S:LlJ:<!D>.R'lit~Jl()!l_ 

J'orecasts_20l5.pdf 

4 
48 

companies developing innovative, small, low-cost satellite systems is, however, resulting in a 

new world of exploration and experimentation for private industry, universities, research 

institutions, start-ups. and non profits. 

Private Industry is Meeting Launch Marker Demand 

The predicted increase in the number of small satellites (l kg-500kg) over the coming years is 

directly related to the technology and manufacturing trends that are allowing for low-cost and 

rapid production of hardware and will be promulgated by the accelerated commercial 

development tor access to space. As the commercial space industry experiences this rapid growth 

in potential demand, the U.S. launch industry is responding. Presently, the U.S. launch services 

market is dealing with demand primarily in three ways: 

I. As noted. companies are investing substantial capital in the development of a new class 

of small launch vehicle systems for these payloads, including Virgin Galactic with 

Launcher One, Firefly with its Alpha vehicle, and Rocket Labs with its Electron launcher, 

among others. 

2. Through bundled satellite deals, on dedicated medium- to intermediate-lift rockets, 

including the SpaceX Falcon 9, and Blue Origin's future orbital launch vehicle. 

3. Through secondary payloads, with help from Nanoracks and Spaceflight Services, 

companies with very small satellites join launches provided for other satellite 

customers-here, Planet Labs, with its large constellation of low-cost, small remote 

sensing satellites has flown to orbit as a secondary customer on a number of flights, 

including missions to the ISS. 

Additionally, there have been several proposals for the deployment of large NGSO constellations 

of hundreds or thousands of small satellites to LEO to support low-cost, low-latency broadband 

Internet worldwide. Even here with these mega LEO constellations, the current commercial 

market is providing sufficient capacity. For example, one of these companies, OneWeb, has 

selected a mix of Ariane's Europeanize Soyuz and Virgin Galactic's Launcher One to deploy and 

replenish its constellation. 

Outside of small launcher capacity and dedicated bundled flights, many small satellites today fly 

as secondary or auxiliary payloads on launch vehicles designed for much larger satellites. 

Although the market is responding with the development of new small-class rockets, there are 

limited options for dedicated launch vehicles today that allow small satellites to be the primary, or 

lead, payload. While small satellite customers benefit from being a secondary payload through 

fractional pricing relative to the price of a dedicated launch service, CSF acknowledges that status 

as a secondary or auxiliary payload does sometimes result in tradeoff's for the small satellite 

customer. For example, satellites that fly as secondary or auxiliary payloads must align their 

launch schedules with the primary customer. and usually have to go to the orbit of the primary 

payload. 

The best solution for access to space for small satellite companies in the U.S. will come when 

there are dedicated launch providers specifically targeting small satellites as their primary 

payload, coupled with options for bundled launch services on larger rockets and opportunities to 

ride to space as a secondary payload. As noted throughout my statement, small launch vehicle 

capability is less than a year away, financed by private capital. The launch services market is 

5 
49 

robustly responding to demand-Government intervention at this time is not necessary and would 

likely be harmful. 

U.S Launch Capacitv 

With this growth in demand for domestic space launch, the need in the near term for state-ot~thea!1 launch facilities is necessary, Various spaceports from Virginia to Florida to Alaska are well 

positioned to support existing as well as new launch vehicles that are coming on line. From 

horizontal, vertical, and other gateways into space (World View Experience incorporating 

ballooning technology), as well as testing and research, many different types of facilities and in 

turn. multiple spaceports, are necessary, 

Beyond the Federal Ranges at Cape Canaveral Air Force Station (CCAFS) and Vandenberg Air 

Force Base (VAFB), as well as the existing Mid-Atlantic Regional Spaceport (MARS), there are 

currently spaceports in all stages of development In California, the Mojave Air and Spaceport 

has for years served as a critical test bed and proving ground for radical new technologies that 

have developed into new space capabilities for the United States. Spaceport America, in New 

Mexico, will soon serve as the launch pad for suborbital space tourism. [n Georgia, the Camden 

County Spaceport seeks to join the ranks of the licensed spaceports in the near future. Space 

Florida is working with companies like Blue Origin to build modern manufacturing and launch 

facilities. To help support its incredible launch demand, SpaceX is currently developing the 

world's first fully commercial orbital launch site at Brownsville, Texas. These spaceports will 

contribute to the Nation's capacity to get to suborbit or orbit, and they will all benefit from a 

healthy market of launch vehicles-but, they will be inhibited if U.S, policy were ultimately to 

favor one or two companies over the investments being made in numerous private companies. 

Policy Matters Facing Congress and the Industry 

CSF, as the leading organization for the commercial space industry, worked hard with Congress 

on the Commercial Space Launch Competitiveness Act (CSLCA), which was signed into law in 

November of last year. This bipartisan legislation took important steps to refresh U.S. policy and 

law with respect to the commercial space launch industry, CSF appreciates the important and 

well-considered work done by this Committee and the entire Congress on this legislation, as it 

will facilitate the continued growth in commercial spaceflight 

Commercial Use of Excess ICBlvf Assets 

Even as the ink is still wet on the CSLCA, the Congress is now facing efforts to reverse decades 

of sound policy with respect to the commercial usc of excess intercontinental ballistic missile 

([CMB) assets. The vast majority, but not all, of CSF's 70 member companies strongly oppose 

any effort to reverse the policy. 

There are now some in the defense industry that are advocating for releasing old Minuteman and 

Peacekeeper rocket motors from decommissioned U.S. Government intercontinental ballistic 

missiles ([CBMs) for use in the commercial marketplace. Those advocating for this change seek 

to buy the rocket motors at a substantial discount (or simply have it supplied as Government 

Furnished Equipment (GFE)) and then compete against other U.S, companies that have developed 

their own launch capabilities. using private capital investment This proposal is counter to long6 
50 

standing U.S. law and policy, including the Commercial Space Act of 1998 and the National 

Space Transportation Policy, which seek to promote commercial space transportation capabilities. 

In the early 1990s, following U .S.-Russian Strategic Arms Reduction Treaty (START) 

agreements, the issue of whether or not subsidized U.S. government launch assets should be 

allowed to compete against U.S. commercial launch service providers reemerged in the form of 

excess ballistic missile assets. Having learned the hard lessons from the failed governmentsubsidized Space Shuttle launch model 8

, and not wanting to repeat them, the U.S. Government 

correctly reaffirmed the successful U.S. commercial space launch policies established under the 

Reagan Administration in the 1994 National Space Transportation Policy. The policy set out to 

"encourage private sector investment in new space transportations systems" by: (I) directing U.S. 

government agencies to purchase commercially available U.S. space transportation products and 

services to meet their needs; and (2) directing excess ICBMs to either be retained for government 

use (only after certain, stringent conditions are met) or destroyed. 

Indeed, Congress was especially mindful of the potential negative impact that the conversion and 

use of excess ballistic missiles would have on the growth of the U.S. commercial space industry 

in crafting what eventually became Section 205 of the Commercial Space Act of 1998. For 

example, the Committee on Science commented: "It is the Committee's understanding that the 

[National Space Transportation Policy] sought to strike a balance between efficient use of 

government assets and the potential to undermine the health of the U.S. commercial space 

transportation industry. 

Wholesale conversions of lCBMs [Intercontinental Ballistic Missiles] into space transportation 

vehicles risks placing the government in the position of competing with the private sector and 

could have long - term consequences."9 

By consistently reaffirming 30 years of U.S. commercial launch policy, improving regulatory 

stability, and promoting pro-growth policies, the United States Government has, thus far, fostered 

a healthy development of U.S. commercial launch service providers-and we are seeing this 

policy bear fruit today. Currently U.S. providers operate eight different commercially available 

orbital launch vehicles, with several more under development. Over the past two years, the U.S. 

commercial launch industry has made significant progress in terms of competitiveness and 

innovation. U.S. commercially available launch providers have both recaptured a predominant 

share of the global commercial launch market, and, established the U.S. as the leading provider of 

access to space for commercial small-satellite ventures. With a number of new U.S. launch 

vehicles entering commercial operations in the next year or two, including multiple dedicated 

small-satellite launch vehicles, this progress is forecasted to continue. 

For decades, the Government has correctly recognized that it should not be competing against the 

U.S. commercial launch sector by utilizing excess ICBMs for its own use (unless certain, 

stringent conditions are met) because this would •have adverse impacts on the U.S. launch 

industrial base, to the detriment of national security and civil space objectives. This concern 

would be materially exacerbated by allowing these excess ICBMS to be sold on the open 

commercial market, because the Government would be directly competing against U.S. industry 

beyond the Government launch services sector. 

8 Smith, Marcia. "Space Launch Vehicles: Government Activities, Commercial Competition, and Satellite 

Exports." Congressional Research Service Issue Brief for Congress. 29 April 2005. Pg CRS-2. Source: 

www .hq.nasa._gov oft}cc _hq!_ibm~Y~~ c!o_cumc!]t_~/(J(~~)6?46!3 ._p_df 

H.R. Rep. 104 · 801, pt.!, at 26 (1996). 

7 
51 

CSF encourages this Committee to strongly oppose any change to the existing policy with respect 

to the commercial use of excess ICBM assets for the following reasons: 

I. Flooding the market with cheap government motors would tilt the playing field away 

from the commercial industry and toward the company that received the cheap motors. 

This kind of market intervention is exactly what the current policy is designed to avoid: 

picking winners and losers in the marketplace. It also sends a strong signal to investors: 

don't put your money in launch vehicle companies- the government may decide to cut 

you off at the knees anytime. The result: a weaker U.S. rocket propulsion industrial base, 

less innovation from start-up companies, fewer new technologies, and a Jess robust U.S. 

national security launch capability. 

2. This policy reversal is not necessary. Not only are U.S. firms bringing launch vehicles to 

market. but Russia is removing both of its Dnepr & Rokot converted ICBM rockets from 

the market. 10 

3. The impact of this policy reversal has not been studied. Although media reports recently 

indicated that the Air Force is interested in changing the policy, it is abundantly clear that 

the Air Force or the Department of Defense has taken no steps to assess or understand the 

impact of this policy change on the commercial space launch market. 11 

4. This change would materially damage investment by sending a signal to potential 

developers of future commercial space transportation services that the Government will 

compete with them at any time. and that the Government will pick winners and losers. 

5. This change would undermine longstanding non-proliferation efforts by the U.S. 

Government to limit the use of these missiles to Government use (in rare circumstances, 

requiring a waiver/certification), or be destroyed. 

6. This change would undermine U.S. Government international leadership opposing the 

use by other nations of these excess assets on the commercial market, potentially 

resulting in a flood of these national assets into the market by other nations. 

7. There will be no material cost savings to (he Government, while this reversal in policy 

could irreparably harm the U.S. commercial launch industry. Even if a portion of these 

motors were allowed to be used for commercial launch services, the Air Force would still 

be required to pay storage and monitoring costs, even if the policy is changed." 

10 '·Moscow Conlirms Suspension of Russian-Ukrainian 'Dnepr' Rocket Launches." Sputnik News. 12 

December 2015. "An April 15 [2015] decision by the President of the Russian Federation suspended the 

'Dnepr' conversion program." Source: hnp: sputniklte"SSI>In >Hlrld)O 1512.16!10:' lg5:J451 russialtk ra it1(:-Jn iss i le-laiJnc!lcs. ht1t1! 

"Russia to close Rokot conversion rocket launches under new space program draft." Tass Russian News 

Agency. 02 February 2016. Link: http: tass.ru:cn.scienee X540 IS 11 Klotz, Irene. Reuters. I 4 April 2016. "The last thing we want to do is harm the entrepreneurial space 

market that we've built in this country. But I don't think it's necessarily a given that selling (ICBMs) will 

harm it, nor do I think that it won't harm it. We don't have any information one way or another," Loverro 

said.'' Source: http> \V>\\\.reutcrs.com a11i<:lc us-,pacc-missilcs-commcrcial-idLSKCNOXB2YG 12 Air Force 20 I 7 Budget Request. Storage and Surveillance Cost. Storage and Surveillance Costs: FY!7 

$!!.198M; FY18 $20.9I4M: FY 19 $I 9.861; FY20 $17.817; FY21 $18.133 Source: 

8 
52 

8. There has been no research done or policy discussion conducted as to what would happen 

if there was a launch failure with an excess ICBM - what would that mean to the 

integrity of the ICBM arsenal and the broader efficacy of one leg of the nuclear triad? 

India Launch Services 

Prohibiting access to foreign launch services, like India's, who do not allow their payloads to fly 

on U.S. vehicles, has opened another set of opportunities for U.S. commercial companies to 

develop their own systems to serve the global satellite launch market. 

Here, CSF opposes any change to the current U.S. policy with respect to launch on Indian launch 

vehicle systems. 

For commercial as well as government launches, Indian launch vehicles are operated by the 

Indian Space Research Organization (ISRO), a government entity that also funds the development 

and manufacture of these launch vehicles. Here, CSF has seen that pricing for commercial launch 

services on Indian rockets historically has not reflected the true costs associated with their initial 

development and on-going launch operations, putting U.S. commercial launchers at a 

disadvantage in competitions for these class of payloads. In effect, India is dumping these 

vehicles on the commercial market to the detriment of U.S. firms. We would encourage the U.S. 

Congress to support American firms offering legitimate pricing for launch services in this market. 

To be sure, the U.S. National Space Policy, the National Security Space Strategy, and the 

National Space Transportation Policy all note the importance of a robust domestic commercial 

industry. Specifically, the National Space Transportation Policy notes that "strengthen[ing] U.S. 

competitiveness in the international commercial launch market is important to ensuring that U.S. 

space transportation capabilities will be reliable, robust, safe, and affordable in the future" and 

directs U.S. government entities to consider the health of the U.S. space industrial base in making 

decisions regarding space transportation. 

As my statement has documented, American industry has invested hundreds of millions of dollars 

to meet government and commercial requirements for space launch services and is recapturing 

global commercial launch market share. Industry is bringing new launch capability to market to 

meet new market demand. A new generation of small, flexible, and low cost launch vehicles are 

being developed with private sector resources and these companies have already added thousands 

of high-tech American jobs. These new start-ups are particularly vulnerable to the predatory 

pricing practices of government-owned and -operated launch systems. 

Consequently, CSF opposes efforts to facilitate a government-subsidized foreign launch 

company-in this case, ISRO-to compete with U.S. companies. Such a policy runs counter to 

many national priories and undermines the work and investment that has been made by 

government and industry to ensure the health of the U.S. space launch industrial base. At the 

same time, we have to be cautious not to squeeze out the U.S. satellite manufacturers and 

operators that have immediate launch needs which cannot yet be served by the aforementioned 

U.S. launch vehicles that are still in development. If it can be shown that there are no viable U.S. 

http: www. i2insights.com!library .·de tense_ budg,·t -documents'!)· 20 I 7-dctcnsc _budget· 3600FiJ600f·-

06.1J5860F-f{..pdf 

9 
53 

launch opportunities in a given timeframe to a required orbit, launch on PSL V or GSL V should 

continue to he considered on a case-by-case waiver review for U.S. payloads, as has been the 

practice for the last several years. This practice should continue while still relevant, but with the 

knowledge that it is a temporary solution until the U.S. launch industry further matures and 

becomes available for U.S. payloads. 

*** 

Conclusion 

Mr. Chairman. on behalf of the more than 70 Members of the Commercial Spaceflight 

Federation, I appreciate the opportunity to testify before this Committee on this timely and 

important topic. Given the significant technological breakthroughs and private investment 

happening across our business, I strongly encourage this Committee to be highly circumspect 

about ill-conceived changes to policy that could effectively unwind the progress our industry is 

making. 

American industry is responding to market demand and innovating on new technologies, 

outpacing any other nation in the world. We seek to preserve this national leadership in space, 

extend Earth's economic sphere, and to create safe and reliable access to space. We look forward 

to working with the Congress to achieve these goals. 

10 
54 

ERIC STALLMER, PRESIDENT OF THE COMMERCIAL SPACEFLIGHT 

FEDERATION 

Eric Stallmer is the President of the Commercial Spaceflight Federation. 

CSF is the largest trade organization dedicated to promoting the 

development of commercial spaceflight, pursuing ever-higher levels of 

safety and sharing best practices and expertise throughout the industry. 

Under StaHmer's leadership, CSF has worked tirelessly to develop industry 

standards, craft the modern Commercial Space Launch Act and encourage 

further growth in the commercial spaceflight industry. 

Stallmer constantly promotes the industry and CSF member companies 

through his outreach to high-ranking officials and high-profile media 

outlets. His professional comments have been featured in The Washington Post, Wall Street 

Journal, NBC Today Show, ABC News, CBS News Radio, Fox News, The BBC, CNBC, 

SpaceNews, Orlando Sentinel, Florida Today, Der Speigel, Men's Journal, and more. Stallmer 

also promotes the mission of CSF through participation at multiple industry conferences 

throughout the year. 

Earlier this year, Stallmcr testified before the Senate Subcommittee on Science, Space, and 

Competitiveness in a hearing titled, "U.S. Human Exploration Goals and Commercial Space 

Competitiveness." There he encouraged Congress to codify a number of productive policies that 

will facilitate growth and innovation in the industry, and maintain the American space sector's 

competitive leadership 

Before his position at CSF, Stallmer served as the Vice President of Government Relations at 

Analytical Graphics Inc. (AGI). Stallmer joined AGl in 2002. While there, Stallmer represented 

AGI's commercial off-the-shelf products and technology to defense, intelligence, Congress and 

civil government sectors within the aerospace industry. 

Stallmer came to AGI from The Space Transportation Association (STA), a non-profit, industry 

trade organization providing government representation to companies with a vested interest in 

the U.S space launch industry. Prior to that, Stallmer worked on Capitol Hill in the office of then 

Congressman Tom Coburn. 

For the past two decades, Stall mer has served as an Officer in the United States Army and Army 

Reserves. He was awarded the Bronze Star Medal for meritorious service while engaged in 

combat operations during Operation Iraqi Freedom. He is currently assigned to the Pentagon in 

the office of the Deputy Chief of Staff Army for Logistics, G-4. 

Stall mer earned a Master of Arts Degree in Public Administration from George Mason 

University, Fairfax, VA, and a Bachelor of Arts Degree in Political Science and History from 

Mount Saint Mary College in Newburgh, N.Y. He and his wife Amy live in Arlington, Virginia 

with their three children, Charlie, Billy and Catherine. 
55 

Chairman BABIN. Thank you, Mr. Stallmer. 

The Chair now recognizes himself for five minutes for questions. 

This is directed to both of you. The United States has retained 

a number of excess intercontinental ballistic missiles and component parts. Current law permits these ICBMs to be converted for 

government use in space launch vehicles but only if certain conditions are met. Current law does not permit these ICBMs or their 

component parts to be converted to commercial launch vehicles. 

Recently, in SpaceNews we saw dueling op-eds written by George 

Whitesides of Virgin Galactic and Scott Lehr of Orbital ATK regarding how changing the current rules to allow access ICBM motors to be used for commercial launches would impact America’s 

space industry. Lehr says that U.S. companies are losing small satellite launches to international competitors—specifically, Russia— 

because of these restrictions. Whitesides argues that allowing excess government ICBMs to be used for commercial launches would 

undermine the nascent U.S. small satellite launch services industry, which is heavily invested in the development of new launch vehicles. 

What would be the advantages and disadvantages of amending 

the law to permit wider use of excess ICBMs for commercial space 

launch? Mr. Pulham or Mr. Stallmer, who wants to go first? 

Mr. PULHAM. Thank you, Mr. Chairman. As you note, this is a 

fairly recent and highly contentious issue. And at the aforementioned Space Symposium last week, I had a considerable amount 

of lobbying from both sides of the issue for many of our member 

companies. And there’s a disparity of opinion. 

The Space Foundation has always prided itself on being a consensus-based organization. We put together our pioneering report 

that Congressman Bridenstine has incorporated in his American 

Space Renaissance Act, and we took a year to do that so that we 

could address all the concerns and make sure that what we came 

forward with was something that the entire space community 

would rally behind and benefit from, and similarly, the white paper 

recently on ensuring the U.S. leadership in space bringing 14 organizations and taking about seven months to write what’s essentially a three page paper. 

Our view right now is there is not consensus on this issue, and 

so we really are not going to take a stand one way or another. I 

think that the ideas need to play themselves out in the marketplace. I’m not a believer in the no-win scenario or the zero-sum 

game. I think that there is probably a path forward for consensus, 

but that will take some time. 

Chairman BABIN. Mr. Stallmer? 

Mr. STALLMER. I will take the path of the choices—the advantages or disadvantages. I’ll lean to the disadvantages first. Flooding 

the market with cheap government motors would certainly tilt the 

playing field from the commercial industry. There’s many companies out there that have invested significant amount of private sector investment in developing a marketplace, developing vehicles to 

address this very market that we’re talking about. 

The long-standing government policy which has been around for 

30 years, several different Administrations—is sound policy. We 

saw the effects that it had of the government in the marketplace 
56 

during the shuttle era when the government was launching commercial payloads. In 1980, the United States had 100 percent of the 

commercial launch market. By, I believe, 2010 we had zero percent 

of the commercial launch market. 

So it’s a dangerous precedent to go down. And there’s a lot of different reasons, not just the cost. It stunts innovation. We have 

companies out there in Texas, and California, all over the world, 

probably in every State that is represented here on the dais, that 

are developing innovative technologies. And I think a step back in 

this direction would be a tremendous one, it would send a message 

in innovation and it would send a tremendous message to the investment community on whether, you know, government policy 

should be adhered to or followed as we move forward. 

A lot has been said on the type of these vehicles and the cost savings to the Air Force. As we look at it, it’s very difficult to find that 

cost savings that the Air Force is looking for. 

And, Congressman Veasey, I apologize on the delay on the testimony. As we mentioned, we were both out—Elliott in a much 

greater fashion—at the Space Symposium where we worked extensively with meetings with many of the different companies that are 

involved in this issue and also where the Air Force stands on this 

issue. And that’s also a very difficult position to find at times. 

You can talk to some of the most senior members of the Air 

Force that have no opinion or no knowledge of this issue on Tuesday, and on Thursday the Air Force is coming out and saying, you 

know, maybe we should evaluate this and there could be a sweet 

spot but we don’t want to upset the apple cart with the commercial 

sector. 

As far as the tax savings goes, a lot of it comes down—what is 

said—it’s the surveillance and monitoring and the maintenance of 

this fleet of ICBMs. There’s over 900 of these potential muscles 

that the Air Force is safeguarding, monitoring, and surveilling. If 

you just perhaps say that we’re going to give 50 of these motors 

to the commercial marketplace, you still have 850 of these motors 

that you have to surveil and monitor and watch and everything. If 

you rent storage space, and just because you take, you know, some 

items out of the storage space, you still have to pay for that storage 

space. And also, this is a sunk cost that the taxpayers have paid 

for for their intended purposes. 

So there’s a lot of concern with this and how it could disrupt the 

marketplace. It can disrupt the private sector investment. I certainly see it and the debate back and forth has been tremendously 

cordial with the companies that are involved and thoughtful. 

And for my companies, we represent most all of the spaceports 

in the United States. We have over 10 spaceports that we represent. And I see the concern that they have because to stay in 

business, you need to be launching vehicles. And I am all for that 

and I want to see them grow. I want to see other U.S. launch companies grow. But I think if you shut off this—the capital investment by, you know, tilting the playing field, it will certainly impact 

on other launch companies and limit the amount of launch companies that could be launching at these spaceports. 

So I apologize for the long answer on that. 

Chairman BABIN. Okay, sir. Thank you. 
57 

Okay. Now, I’d like to call on the gentleman from Texas, Mr. 

Veasey. 

Mr. VEASEY. Thank you, Mr. Chairman. 

And I wanted to ask both members of the panel. There seems to 

be a lot of emerging activity in both the smallsat and small launcher arenas. A few years ago, dedicated small launchers were greeted 

with lukewarm reception and the demand never really materialized. What has changed this time around to make the small 

launchers more attractive? 

Mr. STALLMER. Money. I would say money. There’s tremendous 

investment capital. Elliott had mentioned earlier in the late ’90s 

with these pie-in-the-sky ideas, these large, huge commercial constellations. I think the technology was almost there but the funding 

wasn’t there as much, and the capital markets froze up. The capital 

markets aren’t freezing up right now, and there’s a tremendous 

amount of investors. There’s crossover investors. They’re investing 

not only in these large satellite constellations but also in the 

launch vehicles that will provide—you know, provide access to 

these constellations. 

So I think that’s probably the biggest difference right now from 

what we saw in the past, and it’s the tremendous need for big 

data—data, data, I’m sorry. But there’s a tremendous need there 

for internet access, as well as, you know, remote sensing needs, the 

satellite communication needs. So as our appetite for this grows 

larger, I think you’re going to see the need for these larger constellations. 

Mr. PULHAM. I would agree with Mr. Stallmer’s comments. I 

think, you know, a couple other things are at play. The large constellations that have been proposed in the ’90s were really about 

building telecom backhaul and video backhaul, and today, we’re in 

a world of much more directed consumer use of the satellites and 

their data. If you look at the largest category of commercial satellite activity, it is direct-home broadcasting followed by GPS, 

which is direct to consumer. Everybody that’s got one of these a little iPhones or whatever you’re carrying, you’ve got a satellite 

ground station that you’re carrying in your pocket. 

I think the other really interesting difference to me that is somewhat about the money is the degree to which there is great synergy 

now between the technical and innovation focus of Silicon Valley 

and the people who are innovating in space and contributing to 

these startups in space. If you look at, you know, what’s going on 

with SpaceX, well, you know, they know a thing or two about Silicon Valley; they have connections there. And there’s this whole 

locus of people who are equally interested and equally financially 

invested in these markets that begin to integrate themselves. 

And so I think you have a more directly relevant set of investors 

that is much better financially equipped than the last time around 

and with a business model that is much more sustainable. 

Mr. VEASEY. And the next question I wanted to ask both of you 

again is on the Indian launch vehicles. What are the critical factors 

that are leading U.S. commercial satellite operators to seek waivers 

to the U.S. policy on launching satellites on Indian launch vehicles? 

Mr. STALLMER. The challenge right now is that the satellite manufacturers are making satellites at a quicker rate right now than 
58 

we have the launch capability. So a satellite is not making money 

as—while it’s sitting on the ground. Currently, the PSLV launch 

vehicle, the Indian launch vehicle, PSLV, has a sweet spot and it 

has the capability of launching some of these satellites right now 

in a timely manner. 

We don’t want to see U.S. launches going overseas by any means, 

whether it’s to India, Russia, or whomever else, but right now from 

the satellite, you know, producers and manufacturers, they need to 

get their assets up in the sky as quick as possible. 

I think this policy with the waivers and the review is a sound 

policy. I think it needs to be in place. I think we should be—you 

know, should stringently look at every launch that is taking place 

on every vehicle—or every payload that we’re putting up on an Indian vehicle. But I think it really needs to be evaluated, and I 

think—as the Congressman said earlier, time will tell on this. We 

hope to phase this out as the new generation of launch vehicles 

come online. 

And in addition to that, a lot of these payloads that are being 

launched on these Indian vehicles are only one-off prototypes because as they’re being launched, they’re not being launched in a 

dedicated orbit. They’re being launched with the orbit that it’s putting on. So it’s mainly the prototypes of these vehicle—these payloads. 

Mr. VEASEY. Mr. Chairman, I yield back. Thank you. 

Chairman BABIN. Yes, sir. Thank you, Mr. Veasey. 

I’d like to call on the gentleman from Florida, Mr. Posey. 

Mr. POSEY. Thank you very much, Mr. Chairman. 

We got a lot of discussion but still a relatively small amount of 

information about the engines themselves. I’d like each one of you 

to just SWAG what you think each one of these engines would be 

worth on the market. 

Mr. STALLMER. It’s hard to say, but I would say if you were trying to launch that payload or that class of payload, whether it’s 

1,200 pounds or—1,200 kilograms or 1,500 kilograms, what would 

it cost on a commercial variant of that vehicle? And I’m guessing 

that that variant would probably be in the $30 million neighborhood. I think—the motors would be about in the $30 million vehicle. 

Mr. POSEY. Okay. 

Mr. STALLMER. The motors would cost about $30 million, I believe. 

Mr. POSEY. Each? 

Mr. STALLMER. So—each. 

Mr. POSEY. Okay. 

Mr. STALLMER. But I think certainly if you go forward, a detailed 

cost analysis would have to be in place to see what the actual cost 

is, what the government cost, what they should be charging, things 

of that nature. 

Mr. POSEY. Yes. 

Mr. PULHAM. Votes, okay. Congressman, thank you for the question. I would associate myself with Eric’s remarks in terms of the 

detailed cost analysis being required. We don’t like to speculate, 

and if we were asked the question and had time to answer, I would 

task my research experts in talking with the Air Force about what 
59 

they’re willing to sell for, talking with companies about what 

they’re willing to pay to try and come back with some kind of a figure. I just have no idea at this time. 

Mr. POSEY. Well, I—you know, it is so hard on the Hill to get 

a yes or no answer out of anybody, much less a good guess at a 

value. And I really do appreciate you SWAG-ing that for me, and 

it just gets us in the ballpark. 

Would either one of you care to comment on the percentage of 

cost of the launch vehicle, the engine is? So if you have one of these 

engines, do you have 50 percent of your program ready to go, 33, 

25? What do you think? 

Mr. PULHAM. Again, Congressman, it’s an interesting question 

because each of these vehicles has different attributes. If you look 

at what Virgin Galactic is doing with LauncherOne, their entire 

first stage is an aircraft, and so their model is fundamentally different. So I just—you know, it would be different for virtually every 

launch vehicle, I think. 

Mr. STALLMER. I think in the category of launch vehicles we’re 

talking about, though, I think it is significant. It is the motor. I 

mean, you certainly need the guidance systems and the payload 

fairings and everything else, but certainly you build a rocket 

around the engine, the motors. 

But I’m not an engineer. I’m a poli-sci guy, so I would stick to 

the experts on that. But if you’re asking me for a WAG, I would 

say it’s a significant portion of the rocket on this type of—— 

Mr. POSEY. Well, you know, I’m figuring that they would probably like to have the whole rocket. You know, what would the payload be on one of the ICBMs that we’re talking about accessing? 

Mr. STALLMER. The size of the payloads? 

Mr. POSEY. Yes. The weight of the payload. 

Mr. STALLMER. I believe that the payload range is anywhere from 

500 kilograms to about 1,500 kilograms. And I think that’s a rough 

estimate because it falls in the medium-sized payload area. It’s— 

you know, whereas a Falcon 9 is a little bit larger. Falcon 9 Heavy 

is extremely larger. What Virgin Galactic and Firefly looking at are 

smaller payload and the less than, you know, 500 kilogram payload, maybe about 300 kilogram payloads. 

Mr. POSEY. Yes. So the question is if I could just buy one of the 

ICBMs, you know, take out the current payload, now I own it, what 

would the market demand be for the 500 to 1,500 range payload? 

Mr. STALLMER. Well, that’s the challenge. It could—the market 

demand is high for that depending on how you use that payload or 

that rocket. So, for instance, just recently—I don’t have the exact 

date—but a few months ago, SpaceX launched the ORBCOMM constellation of satellites, and they basically bundled, I believe, 11 satellites and then they dispensed the satellites out. 

So if you aggregate the payloads, it ranges. If you’re just looking 

for—you know, to use this launch vehicle for one payload, a 1,000 

kilogram payload, then there you go. There may be a market for 

that. I’m not sure of what that mid-class market is, but I know 

mostly what we’re talking about now—and when you’re talking 

about a much larger market, you’re talking about the geostationary 

market, which is a lot—or it’s a very stable—we know almost exactly what that will be and who will be launching it. 
60 

With these smaller satellites that are going up, these smaller 

constellations—and I have a graph I could share with you and the 

breakdown of the weight and the—— 

Mr. POSEY. That’s one of the talking points. I like that. 

Mr. STALLMER. Yes. 

Mr. POSEY. And I was thinking like OneWeb. 

Mr. STALLMER. So what OneWeb is looking to do right now—and 

they have already aligned—of their 700 launches, they are going to 

go with an Ariane space launch vehicle, as well as augment some 

of these smaller aggregation with Virgin Galactic. So the Virgin 

Galactic will maybe launch, you know, several—a handful of satellites at a time where the Ariane variant can launch a much larger amount because it’s a larger payload. And I think Elliott has a 

chart on that. 

Mr. PULHAM. Yes, Congressman. In my testimony there’s a chart 

from our research folks that shows from 2006 to 2015 the breakdown of various masses that were launched. And in the area that 

we’re talking about, the medium 501 to 1,500 kilograms in 2014, 

just eyeballing it, it looks like it was probably about 13 or 14 percent of what was launched, and in 2015, probably only about nine 

or 10 percent. 

Mr. POSEY. Okay. Thank you very much. 

Chairman BABIN. Thank you. 

I’d like to recognize the gentleman from California, Mr. Rohrabacher. 

Mr. ROHRABACHER. Well, thank you very much, Mr. Chairman. 

Actually, is it okay—— 

Chairman BABIN. No—— 

Mr. ROHRABACHER. All right. 

Chairman BABIN. —he’s passing his time—— 

Mr. ROHRABACHER. All right. Oh, my gosh. 

Chairman BABIN. —so you’re going next. 

Mr. ROHRABACHER. Well, he usually refutes me after I—no, 

thank you very much, Mr. Chairman. This—you know, we have 

perplexing issues here in Washington, D.C., and this is one of the 

perplexing issues because we know that one of our great assets is 

this new and thriving and futuristic space transportation systems 

that we have now being developed in the private sector. 

And at the same time have made a lot of investments when they 

were needed during the Cold War, et cetera, in rocket missile technologies that are—there waiting and then what to do with them in 

a way that would not undermine these people who—not changing 

the rules in the middle of the game for this people who now have 

invested in this new industry. 

So let me suggest that it is not an unsolvable formula that we’re 

looking for. We know, and it’s a pretty well—it is pretty well understood that the government does have a right to do launches on 

these ICBMs for government purposes, for a government mission, 

is that correct? I mean, we’re not saying—the private sector isn’t 

saying no, they’ve got to go with the private companies even 

though the government has the capability of doing it itself, is that 

correct? That’s pretty well—— 

Mr. PULHAM. That’s correct. 
61 

Mr. ROHRABACHER. Okay. Well, then the problem then—let me 

just suggest that the government—maybe we’re under—or not looking close enough to see that there are things that the government 

needs to do in space that will help alleviate this problem. For example, if you have a certain number of space vehicles that are 

there like ICBMs and waiting, well, we didn’t build them because 

we wanted them to drop nuclear weapons on the Soviet Union. 

That’s not why we built those. We built those just in case there 

was a war, but we didn’t want that to happen. 

Well, there are lots of things we need to do in space that would 

also mean that we have to have this capability. How about cleaning 

space debris? How about making sure that we have a new commitment to making sure—and that would be a federal commitment, 

and that these rockets will be used for things like that? Or how 

about global protection against meteorites or asteroids that might 

come and destroy the planet if we don’t have the capability of dealing with that? Those are—you know, we have things we can do— 

that the Federal Government has to do and has to be part of. 

If we don’t clean up the space debris, we’re not going to be able 

to do this business in space. It will undermine the private sector 

anyway. So we need to do that, and it needs to be done by the Federal Government. It needs to be a federal program. And so maybe 

we can dedicate these ICBMs to missions like that and—rather 

than trying to undermine our people in the private sector who have 

invested huge amounts of money in order to build this capability 

without thinking their federal—the Federal Government was going 

to change rules of the game and undermine their efforts to operate 

in the market. 

So, anyway, that’s just a thought. The bottom line is we need innovative technologies, but I think what we need, Mr. Chairman, is 

not just innovative technologies, but we need innovative policies 

and perhaps expanding the role and getting the job done that we 

need to get done in space, and focusing on that may help us overcome this perplexing issue that we’re discussing today. 

And you’ve got about a half-a-minute to say yes or no. 

Mr. PULHAM. Space debris is a huge issue, and I never thought 

I would see a time when the commercial industry would be anxious 

to try and find ways to regulate itself because of the environment 

up there. We are starting to talk about space traffic management, 

which has been an off-subject thing in recent years. You know, absolutely space debris is a huge issue, and anything we can do to 

tackle it is something we need to do. 

Mr. ROHRABACHER. Even with the old ICBMs might play a role? 

Mr. PULHAM. If they can play a role, let them play a role. 

Mr. STALLMER. I would say no on the ICBMs because China had 

a satellite that they justified that there was a dead satellite and 

they wanted to take it out of that orbit, and they used an ICBM 

as an ASAT weapon. And as we were tracking—the U.S. tracks 

over 20,000 pieces of debris because of this China ASAT that took 

place by shooting a piece of debris. It caused about 5,000 pieces of 

debris. 

So that would not be the best way, I would say, to use this, but 

I think the focus the Air Force’s technology on space traffic man-
62 

agement and if there’s a way to use these vehicles in that regard, 

I’d be for it. 

Mr. ROHRABACHER. Yes. I think the suggestion wasn’t that the 

ICBM—— 

Mr. STALLMER. Right. Right. 

Mr. ROHRABACHER. That’s your debris. 

Mr. STALLMER. Right. Right. 

Mr. ROHRABACHER. Yes, you weren’t proposing to blow these 

things out of the—— 

Mr. STALLMER. Not one for one. Not one for one. 

Mr. ROHRABACHER. Yes, but we might have some big machine 

that we put up there—— 

Mr. STALLMER. That’s right. 

Mr. ROHRABACHER. —that could actually—— 

Mr. STALLMER. If we could do that, I would be all for that, sir. 

Mr. ROHRABACHER. Okay. Thanks very much, Mr. Chair. 

Chairman BABIN. You’re welcome. Thank you, good line of questioning. 

Let’s see. Now, the gentleman from Colorado, Mr. Perlmutter. 

Mr. PERLMUTTER. Thanks, Mr. Chair. 

And Mr. Rohrabacher and I often disagree, but a lot of times we 

agree, and he and I are on the same page when it comes to creating 

some kind of formula that both encourages private development of 

launch systems to carry, you know, smaller satellites to really 

maximize the private endeavors here but also maximize the investments that taxpayers have made, whether they’re from Colorado or 

California or any place else in the Nation with all of these ICBMs. 

So I think there will be a formula that will do both of those 

things. And, you know—and I agree we want to use the ICBM not 

to blow something up, up there but to maybe be the vehicle 

that—— 

Mr. PULHAM. Certainly. 

Mr. PERLMUTTER. —you know, has the snowplow cleaning up the 

junk up there. 

So, you know, one of the things I want to see encouraged, and 

I think we’re seeing this development, is with the small satellites, 

the CubeSats, the microsats, whatever you call them, to be able to 

have some kind of a launch system that really is dedicated to them. 

And so that, you know, whether it’s some private—small private 

enterprise that’s building the satellite or whether it’s, you know, a 

university developing the technology to go on a small satellite, I 

mean, I came in late and my guess is you gentlemen already answered this, but are those launch systems being developed? Is 

there something else we as a Congress can do to spur their development? And I’ll turn it over to whoever wants to go first. 

Mr. PULHAM. Thank you, Congressman, and I appreciate you 

being here and would invite you to see some satellite payloads 

being deployed from Fort Carson the summer. We are involved 

with the United Launch Alliance on a program called Future 

Heavy where we’re going to be launching the world’s largest amateur rocket from Fort Carson and deploying about a dozen student 

experiments that are all in the CubeSat sort of range. So I hope 

you can join us for that. 
63 

I think that, as my colleague has suggested, that development is 

going very, very well, and so what we need to focus our efforts on 

is how to be—to not perturb, I guess, the environment by acting 

without really, really thinking things through. I think that the— 

a lot of the launch companies have great, innovative ideas. The architectures that they’re introducing are very interesting, and 

they’re working with lots of different spaceports, which is going to 

give people a tremendous variety of options. 

So I think we’re headed on a really good path. We’ve got a lot 

of private investment pouring in, and so I would say just let’s not 

throw the baby out with the bathwater. 

Mr. STALLMER. I would concur with Elliott on that. The process 

right now is working. We have at least four or five small satellite 

launch vehicles in development right now that should be coming 

online within the next year or so. I think any change in this policy 

again could be very disruptive to that process. A lot of this—you 

know, what you don’t want is these companies coming to you for, 

you know, a handout or, you know, additional funding. They’re 

doing it by themselves by private sector investment right now. And 

if we stunt that private sector investment growth, we’re going to 

have a large—you know, a much greater problem. 

So I think we’re doing the right thing in that regard. And even 

if the policy had—would change, you change it tomorrow, it would 

take at least a year to 24 months to transition these motors into 

vehicles, I believe, maybe a year, but maybe more. So I think that’s 

a challenge that we have. 

But I’m all for—you know, as a taxpayer, as someone who’s 

served in the military for 25 years, I see the investment that these 

had and I think if there’s a way that we can think creatively on 

how to use these missiles for not their intended purposes, I think 

it’s ideal. And I’d like to come to—come forward with a solution— 

try to find a solution to that. 

Mr. PERLMUTTER. Okay. So, I mean, I’m happy if you’re telling 

me just let it develop on its own, that there really isn’t any major 

need for us to do something, that’s fine with me. I do want to see 

us not pass up the opportunity to put the ICBMs to work in some 

positive fashion. I guess I’m not afraid of India as being, you know, 

a launch country for some of our small satellites. So I’m happy just 

to be hands-off. But I also have a responsibility as a Member of 

Congress to make sure that the assets of the United States are 

used properly and not just thrown away. 

Mr. STALLMER. I certainly see your concern there from the taxpayer perspective, and it’s greatly appreciated. But sometimes the 

hands-off approach also is appreciated in industry. If you see—and 

sometimes, you need a little hand from the government and a pat 

on the back, but I think if you see the progress that the commercial 

sector has made just in the last week alone or last two weeks what 

Blue Origin has done out in West Texas on improving their 

reusability, what SpaceX did with the commercial cargo launch, 

they launched not only a cargo to the International Space Station, 

they put in their trunk an inflatable module made by a commercial 

company Bigelow Aerospace that attached to the International 

Space Station that was built—the delivery system was built by Sierra Nevada from Colorado, and all the different commercial play-
64 

ers that were involved in that and launched from Space Florida. So 

there’s a lot of tremendous growth going on in the commercial marketplace. 

Mr. PERLMUTTER. I have one last question if I could, Mr. Chair. 

So when I walked in, I wasn’t quite sure if I heard this correctly, 

but did you say that these companies should get their assets up 

into space as soon as possible? Is that what you said, assets, I 

hope? 

Mr. STALLMER. I think, yes, the companies—and I think collectively as a nation we should get our other assets—— 

Mr. PERLMUTTER. Get our assets up into space? All right. Thank 

you. I yield back. 

Chairman BABIN. Yes, sir. Thank you. And I’d like to call—— 

Mr. STALLMER. My mother might be watching, so I’ll be careful. 

Chairman BABIN. I’d like to call on the gentlewoman from Virginia, Mrs. Comstock. 

Mrs. COMSTOCK. Thank you, Mr. Chairman. 

It’s hard to have a discussion about commercial space and not 

mention Virginia’s Mid-Atlantic Regional Spaceport at NASA Wallops, which is one of only four launch sites in the entire United 

States that is capable of launching to orbit. It has served as a vital 

asset in support of our nation’s space industry. So there has been 

discussion on the commercial use of decommissioned ICBM motors, 

and I wanted to ask how potential use of these motors could benefit 

our nation’s spaceports, including MARS? 

Mr. STALLMER. Well, we represent MARS and the great people 

at the Mid-Atlantic Regional Spaceport. Dale Nash is doing a fantastic job down there, and I think it’s a vital asset to the U.S. 

spaceports, and we are tremendously supportive of what he does. 

And I also should say, Congresswoman, tremendously supportive of 

what you do for McLean Little League and your support. 

Mrs. COMSTOCK. Thank you. 

Mr. STALLMER. You know, I have three children that are quite 

heavily—— 

Mrs. COMSTOCK. That was a great—— 

Mr. STALLMER. —involved. 

Mrs. COMSTOCK. We just had our kickoff on Little League, and 

Jayson Werth threw out the first pitch, so that was fun, too, right? 

Mr. STALLMER. I heard he was only going to be there because he 

knew you were going to be there so—— 

Mrs. COMSTOCK. Oh, yes. 

Mr. STALLMER. But, no, the spaceports are vital to the economic 

growth of our industry. It’s a total ecosystem of what we’re dealing 

with. Without these state-of-the-art reliable spaceports, we’re not 

going to have the vehicles that we can put up into space and all 

the tremendous benefits that we’re going to get to space. So to say 

we support Mars, it would be an understatement because I think, 

as I say, a vital asset. 

I guess our thinking would be—and they have a great partnership with Orbital ATK, another fantastic company, whose right in 

the middle of this issue, and we want to see Orbital be launching 

as many vehicles as they can from MARS and from the other 

spaceports. 
65 

We see the value, though, without these ICBMs, that there’s potential of launching even more vehicles from those spaceports and 

that spaceport in particular. However, I think if the government 

intercedes and cuts into the competitiveness of the commercial 

marketplace, as we’ve seen in the past, it can have a really damaging impact on the industry as a whole. So instead of launching 

one or two vehicles from the spaceport per year, you can go either 

way. It could be we launch several or launching a few, and I think 

that’s what we really need to examine. But tremendously supportive of the Virginia spaceport. 

Mrs. COMSTOCK. All right. Thank you. 

And thank you, Mr. Chairman. 

Chairman BABIN. You’re welcome. Thank you. 

I think at this time we’d like to go back through for a second 

round of questions if that’s amenable with everyone. 

I recognize myself for the first one. 

Under the 1998 Commercial Space Act the Federal Government 

can use excess ICBMs for its own use as long as certain conditions 

are met. We’ve heard that numerous times today. This provision 

was utilized by NASA for the LADEE mission. We’ve recently 

heard that the procurement for this mission was particularly onerous and resulted in a protracted protest to the GAO. As a result, 

we’ve heard NASA is hesitant to use excess ICBM motors on future 

missions despite being able to do so. What can the Congress do to 

make it easier for agencies to utilize existing authorities to use 

these access ICBMs for governmental purposes? Both of you. 

Mr. PULHAM. Mr. Chairman, I think you cut right into the 

Armed Services Committee here. The issue, I think, is the difficulty 

of the contracting environment as regards federal defense and 

space procurements these days. There’s very rarely anymore a procurement that doesn’t end up in court or appealed or challenged or 

protested or whatever can be done. And so, you know, I think that 

the issue is not one that’s particular to launch vehicles of any kind. 

I think it’s systemic within federal contracting and needs to be the 

subject of contracting reform discussions. 

Chairman BABIN. Mr. Stallmer? 

Mr. STALLMER. And I think a lot of this discussion, you know, 

when we go through the research and the waiver process to launch 

in these vehicles, a lot of this policy is the discussion on the potential of what if a launch failure happened at one of these ICBMs? 

I think that is a discussion and what this could mean to the nuclear triad. I think that was where a lot of the area of pause came 

from and the implication and the integrity of our ICBM arsenal. 

So I think there’s a lot of broader policy implications involved 

with this. Certainly, the discussion with Congress on how we can 

streamline these processes would be helpful in that regard because, 

again, the national policy does state that these assets can be used 

for defense and other government missions and just—they—you 

know, they need to go through that process. So I think it needs to 

be a thoughtful discussion involved on that. 

Chairman BABIN. Okay. Thank you. 

And then, again, General Hyten, Commander of Air Force Space 

Command, stated in the ‘‘Financial Times’’ yesterday that a growing number of commercial launch ventures made him worry wheth-
66 

er there was enough business to sustain them all, noting a similar 

bubble in the late 1990s that burst when commercial satellite constellations went bankrupt. Is the recent prosperity of the small satellite market a result of technological advances such as Moore’s law 

and spin-in from the technology sector, or is it a reflection of a 

short-term bubble in launch services brought about by government 

subsidies? 

Mr. PULHAM. Thank you, Mr. Chairman. 

I certainly don’t think it’s because of government subsidies. I 

think that you’re seeing different success in different sectors of the 

space industry, and that drives itself into the various types of satellites that are being launched. 

In the case of the very small satellites, it’s really been the development of microelectronics and the compression of processors and, 

you know, the availability of nanotechnology that is allowing these 

small satellites to be produced almost as a commodity. They’re 

coming off an assembly line and students are putting them together, and it’s not the kind of intense clean-room operation that 

major satellites are contending with. 

At the same time, the companies that have orbital slots where 

they’re able to put very high-value satellites in geostationary orbit, 

they’re not shrinking those satellites. They’re putting more and 

more capability into them and more and more capability to stay in 

orbit longer. And because the longer a commercial satellite is functioning, the more revenue they’re able to see from it. 

And so you’re seeing investment from the commercial operators 

in things like research that will help them with satellite servicing. 

And I think it was Intelsat that just inked an agreement with 

somebody to do a—— 

Mr. STALLMER. With Orbital ATK. 

Mr. PULHAM. With Orbital ATK to do a demonstration of satellite 

servicing. 

So you have different types of investment being made in different 

sectors of the industry. You do have—you know, the launch business is interesting. It really only comprises about 2 to 2–1/2 percent of the total space marketplace globally, but that 2–1/2 percent 

works out to, you know, about $3 billion or so, so that’s not—$6 

billion, so that’s not chump change if you want to be in that business. 

So there is a market for each of these things, and I think, you 

know, we need to trust the companies that have business plans and 

business models to go after each of the segments and to do so 

knowing that some are going to succeed and some are going to fail. 

But I think we’re at a point in the maturity of technology and the 

maturity of the industry and the depth of financial strength behind 

these that we’re going to see more successes than failures as we go 

forward. 

Mr. STALLMER. I would say in all due respect to General Hyten 

that I would gauge the forecast of the commercial marketplace 

more from the commercial marketplace rather than from the Air 

Force, as well as through a lot of the organizations that are doing 

these forecasts in tremendous detail, you know, for instance, the 

Tauri Group on their annual forecast of what venture startup looks 

like and on what the Space Angels Network is seeing, as well as 
67 

the FAA’s forecasts, annual forecasts of what they see for these 

markets. 

The way Silicon Valley has invested in these companies I think— 

as I said, there’s a lot of crossover investors that have also invested 

not only in the satellite systems, but also in the vehicles that are 

producing these. 

So I certainly applaud General Hyten’s passion on this issue, but 

I think unless they have reports that I haven’t seen, these forecast 

reports on the commercial marketplace, I would kind of look forward to more of what the commercial forecasts are looking at. 

Chairman BABIN. Okay. Thank you. 

Yes, sir? 

Mr. PULHAM. And if I can add, we talked a lot about Silicon Valley investments and angel investors here. I think one of the hallmarks of where we are today is that the investment is not just 

coming from high-risk-tolerant people, that a lot of the times when 

you see an investment made in a space company, you’ll see a Silicon Valley company sort of as a lead or a face, but it’ll be somebody very institutional like Fidelity Investments or one of the big 

banks back in New York that is putting a huge equity put into that 

because they see profits and they see progress being made in other 

parts of the sector. They see what is being accomplished, and their 

confidence to invest as institutional investors is quite strong. 

So that again takes it out of the realm of where we were back 

when we had things like Teledesic when you were, you know, just 

depending on somebody’s personal, individual wealth, but you’re 

able to appeal to large financial institutions. 

Chairman BABIN. Thank you. Thank you very much. 

Now, I’d like to recognize the gentleman from Colorado one more 

time, Mr. Perlmutter. 

Mr. PERLMUTTER. Thanks, Mr. Chair. 

And, you know, obviously, this is a frontier, but with all frontiers, there’s lots of opportunity and there is risk. And to the degree there are failures, you know, I spent my life before I was elected to Congress as a Chapter 11 lawyer, you know, so that’s just the 

nature of private enterprise. And the fact is that more companies, 

more individuals are willing to see this frontier for the opportunities that it presents. And if we have some mistakes or some things 

don’t go, then that’s the way it is. 

Now, I have a couple questions. Mr. Pulham, deploying small satellites from the space station using a commercial dispenser is perhaps the most accessible onramp for new entrants to space. What 

is the importance of this asset for educational institutions and 

space research? 

Mr. PULHAM. Thank you, Congressman. It’s very important, and 

we’re pleased to work with the folks at CASIS in Florida on a number of programs appealing to students. But it is one of the largest 

users of these small satellites is for universities and student research because they don’t have access to the big national labs and 

platforms. And so the ability to go someplace like CASIS, manifest 

your payload, and have it ejected from a dispenser, which I’m—it 

sounds like we’re all eating PEZ here, but it works and it’s a very 

good approach. 
68 

And what we’re seeing is that other companies that have other 

solutions are also beginning to think about sort of the philanthropic 

part of this, yes, we’re going to put up a vehicle and we’ve got room 

for five small satellites. Why don’t we dedicate one of those to a 

university project? 

So the International Space Station continues to be a profound investment that pays off for this country every single day, and the 

ability to deploy small satellites is just one of many, many things 

the ISS has given us. 

Mr. PERLMUTTER. Okay. Anything to add? 

Mr. STALLMER. I absolutely, completely concur. I mean, the value 

of the ISS is innumerable to speak of, and it is absolutely a great 

onramp for a lot of the type of payloads that are being launched 

from it. 

As we move forward, I know a lot of these satellite payloads 

want to be—get in their dedicated orbit that would be optimal for 

their use, and—whereas ISS you go out where they ship you out. 

So—but it is just an outstanding resource and the work, you know, 

that CASIS is doing is fantastic and, you know, the companies like 

NanoRacks that help support this, it’s great. 

Mr. PERLMUTTER. Similar to a question and discussion we had 

with my last round of questions, so this year, we found ourselves 

talking at length about how to transition from the Obama Administration to the next President. These conversations will likely carry 

over after this year. What advice do you gentlemen have to our 

committee and the incoming Administration, whoever it is, to support the growing commercial space industry? 

Mr. PULHAM. So, Congressman, thank you. In my introductory 

remarks I asked to have included a white paper that our two organizations and 12 others worked on called ‘‘Ensuring U.S. Leadership in Space.’’ And that paper was written particularly to present 

an industry consensus on exactly this issue for people that are running for office, both those that have and those that have not space 

experience. I think this committee is very rich in that you have a 

lot of people here who have this experience and can share that with 

other members. 

The—you know, the enemy that seems to gnaw at space programs in the United States is the enemy of transition from one Administration to another. And I know this plays out in a lot of different parts of the space community, but certainly where we see it 

the most visible is in NASA where it seems like every new Administration wants to put their thumbprint on the program, and we 

stop and throw away billions of dollars worth of effort and start all 

over again. 

Starts and stops and redos are killing us, and we have to get to 

a position of consistency. And many of these recommendations that 

we’ve made in the past are now in Congressman Bridenstine’s bill 

that he announced last week. 

And so things that give NASA and others in the space business 

the opportunity to do multiyear procurements, no-year procurements, stability and leadership, it’s a highly technical enterprise, 

and it shouldn’t be subject to political—high political turnover, and 

just the long-term vision of what are we intending with our space 

industry? We have good space policies—— 
69 

Mr. PERLMUTTER. I’m going to stop you for one second—— 

Mr. PULHAM. Please. 

Mr. PERLMUTTER. —just to put in a plug for something I’m pushing, which is the orbital mechanical engineers say 2033 is the best 

time to get our astronauts on Mars because that’s when we’re closest, it saves a lot of travel time, and so my goal is to make sure 

we have something from a Congressional standpoint suggesting to 

the Administrations as they come and go, let’s get our astronauts 

to Mars at least by 2033 if not before then. 

And so you’re absolutely right, a lot of starts, a lot of stops. We 

need continuity of mission. We need not to start engaging in things 

if the private sector is actually working its way through all of this. 

So 2033, just remember that date, and then, Mr. Stallmer, if you 

had something you wanted to add, go for it. 

Mr. STALLMER. I think Elliott did a great job covering it. 

I would say for the private sector and, you know, the civil and 

military space, their goals should be to do—in regards to civil and 

military space—do what the commercial sector cannot do. The commercial—and I’m going to tell you all the great things that are 

going on in the commercial marketplace. But there is still fundamental science and technology that only the government has that 

competency and capability of doing. 

So, you know, I know firsthand your staff and all the staff here 

has always been engaged with our member—myself and our member companies on knowing what our capabilities are and what our 

aspirations are and what our limitations are. And I think we’ll always be honest with you. And I think as we move forward, you 

know, from whatever new Administration it is going to be, is that 

NASA has core competencies that they’re very good at, as does the 

DOD. And you’ve got to keep in mind that the commercial marketplace would be there to help throughout the way. 

Mr. PERLMUTTER. Thank you. Thanks, Mr. Chair. 

Chairman BABIN. Yes, sir. Thank you. 

And now, I’d like to recognize the gentleman from Florida, Mr. 

Posey. 

Mr. POSEY. Thank you, Mr. Chairman. 

I’m still trying to quantify the potential values and potential uses 

of our potentially expendable ICBMs. Is there anyone in the industry who uses the same motor now? 

Mr. STALLMER. I do not believe so. I believe that Orbital ATK is 

the subject matter expert on solid rocket motors. I could be corrected on that. But by and large, the majority of folks in the launch 

industry use liquid motors, so Orbital is the one—Orbital ATK are 

that. And again, I’ll check for clarification, but I believe—if they 

aren’t, there’s not that many others. 

Mr. POSEY. Okay. 

Mr. STALLMER. I believe they are the only one. 

Mr. POSEY. And I was interested really in domestic because I 

don’t want them to go overseas—— 

Mr. STALLMER. Right. Right. Yes, of course. 

Mr. POSEY. —by any stretch of the imagination. 

A little while ago, you talked about the United States having 100 

percent of the commercial launch market back in the ’80s, and then 
70 

I missed the last part of that sentence. We managed to parlay it 

into what? 

Mr. STALLMER. So the United States changed their policy. The 

United States and—you know, the commercial launches, and then 

we changed the policy to go onto the shuttle. And then after the 

shuttle happened, during that time frame, lot of—Ariane space 

emerged to take up a lot of those commercial launches because of 

the limitations that the U.S. launch companies had. So the U.S. 

Government was still launching—or we still were launching government payloads, but as far as commercial geostationary satellites, were at zero. 

And that has recently changed, I think, with the emergence of 

SpaceX. I think in 2010 we started beginning to capture a larger 

amount of the market share, and right now, I believe—correct me 

if I’m wrong, but I believe that we have 60 percent of the geostationary commercial marketplace. 

Mr. POSEY. Okay. Yes. My recollection is a little bit differently. 

I think we lost the commercial market because we overregulated it 

while other companies subsidized and actually helped their industries. We choked the golden goose. And I think we managed to do 

that. I don’t think there was ever a necessity for an Ariane if they 

had left our commercial launch vehicles alone and let them do their 

job without trying to fund federal agencies with what should have 

been value-added—or actually were non-value-added cost to our 

commercial launch market. 

Thank you, Mr. Chairman. I yield back. 

Chairman BABIN. Okay. Well, I think this pretty much wraps up 

the questioning for today. And I’d like to thank the witnesses very 

much for being here. And I know there were some other folks that 

wanted to come back, but I think they had other meetings. 

So I guess the record will remain open for the two weeks for additional written comments and written questions from members 

who did not get to get back and ask their questions. 

So thank you again, witnesses. We appreciate it. This hearing is 

now adjourned. 

[Whereupon, at 11:22 a.m., the Committee was adjourned.] 
(71) 

Appendix I 

ANSWERS TO POST-HEARING QUESTIONS
72 

ANSWERS TO POST-HEARING QUESTIONS

Responses by Mr. Elliot Pulham 
73 

2015. Looking within the domestic market, ULA accounted for 8 of 15 U.S. orbital 

launches in 2010. ULA was 12 of20 for 2015, even as SpaceX has been ratcheting up 

its launch campaign. When other nations, such as India, have increased their launch 

rates, the trend of the past I 0 years seems to indicate additional launches instead of 

some sort of"zero-sum game" balancing among nations. In other words, the launch 

pie has been slowly getting bigger. It is unclear whether the market is getting bigger 

quickly enough to absorb the additional launch capacity, or whether the competition 

is driving prices down past the point of profitability for launch operators. But the 

appetite for PNT, imagery, and communications services seems to be growing, which 

will continue to drive launch services. 

b. The April 2015 forecasts project growth in the number of micro- and small-class 

payloads, but project that these will be launched in clusters, so that there will be little 

net effect on the demand for launches. How consistent is this with your own 

observations of the industry? 

There are two primary reasons for a micro- or small-sat operator to require dedicated 

launches: schedule and orbit. If the satellite operator's business case does not require 

launches to occur at a specific time, then they can wait till there are other satellites to 

be launched in a cluster. Similarly, if the satellite's orbit is flexible (Planet Labs has 

reputedly been more focused on getting satellites into space than getting them all in 

specific orbits), then any ride-along opportunity is potentially viable. However, if the 

satellite operator's business plan requires definite launch windows or destination 

orbits, then that could drive demand for more launches to serve those needs. 

c. Considering the FAA AST and COMSTAC forecasts, as well as your own 

observations and experience, how likely is it that the demand for commercial space 

launch services over the next decade will be sufficient to support a healthy U.S. space 

launch industry? What do you consider to be the greatest risks for the industry over 

the next decade? 

The U.S. launch industry continues to be one of the most diverse of its kind in the 

world. During the past five years the United States used at least 10 different types of 

orbital launch vehicles for launch operations. This diversity may increase in the next 

few years depending on whether plans from small-satellite and suborbital launch 

providers come to fruition. The FAA AST and COMSTAC forecasts seem to 

anticipate those possibilities, although not necessarily an increase in demand that may 

occur if launch prices come down. The public demand for data provided from the 

satellites has increased. It seems unlikely the data demand will decrease soon. 
74 

2. The FAA AST and COMSTAC forecasts project that commercial crew and cargo resupply 

missions to the International Space Station (ISS) will account for a majority of the 

commercial launches to non-geosynchronous orbits over the next decade, rising to 70% or 

80% of the market in 2020 and beyond. 

a. How consistent are these projections with your own expectations? 

The rising percentages are largely due to COMSTAC's forecasts in NGSO launches 

dropping off to I 0 or II per year in 2020. As noted above, that launch rate is intended 

to be a baseline rather than an expected total. 

b. Although these crew and cargo missions to the ISS are considered commercial, the 

customer is a federal agency, NASA. How might increasing reliance on a single 

government customer affect the commercial space launch industry? 

Most U.S. launches throughout history have been conducted by companies for the 

U.S. government, so this appears to be business as usual (albeit under different 

contractual and operational terms) rather than a case of increasing reliance on the 

government. 

c. U.S. use of the ISS is currently authorized through at least 2024 (P.L. 114-90, Sec. 

114(b)). When ISS operations end, how will the consequent reduction in demand 

affect the commercial space launch industry? 

It depends substantially on whether there are commercial opportunities to absorb the 

launch capacity that would have been used for the ISS. This could include 

commercial space stations, space tourism, higher satellite launch rates, or other 

commercial activities. We won't know until closer to 2024 whether there will be a 

reduction in total demand for launches. 

3. Earlier this year, SpaceX launched a cargo resupply mission to the ISS and, for the first time, 

landed the first stage of the launch vehicle on a floating platform in the Atlantic Ocean. The 

company plans to refurbish and reuse the first stage in a future launch and expects this 

practice to reduce launch costs. 

a. If the company's plans for reusability are successful, how might that affect the rest of 

the commercial launch industry? 

This is not an area we have studied, and it is sufficiently complex that we would 

prefer not to hazard a guess. 
75 

b. How sensitive is the commercial launch market to launch costs? How much potential 

is there for growth in launch demand, if launch costs can be reduced? 

Launch prices tend to shift gradually, so there is not a good precedent for seeing what 

would happen if reusability causes a sudden drop in prices. Common sense might 

indicate more demand when there's less expense. One example of how the market has 

reacted to a new entrant: Rocket Lab, which h~sn 't even conducted its first launch 

yet, is booked solid for all 12 of its launches of cubesats from Q4 2016 through Q I 

2018. Each launch will deploy 32 small satellites in orbit. The costs for one 3u 

satellite (of which there are 24 on each launch) are as high as $250,000 launching on 

Rocket Lab's Electron. So the demand is there, and maybe even pent up. 

What are the key steps in refurbishing a rocket for reuse? 

We recommend discussing this with the rocket manufacturers since it is likely to be 

different for every vehicle. 

c. What changes, if any, are needed in current federal licensing and oversight to address 

the potential reuse of refurbished rockets? 

We recommend discussing this with the rocket manufacturers since it is likely to be 

different for every vehicle. As always, public safety takes priority, which is 

something the FAA's Office of Commercial Space Transportation is very good about. 

d. What concerns might potential customers have about launching their payloads on a 

refurbished launch vehicle? How could a launch company address those concerns? Is 

there any federal role in facilitating this interaction? 

There may be a perception of more risk to their payloads. Lower costs and a 

demonstration of reusable components' reliability are the most likely strategies for 

addressing concerns. Even unproven launch vehicles find customers willing to take 

the risk of a launch failure, which is not that different from flying aboard a proven 

launch vehicle with pre-flown hardware. It is probably best for the federal 

government to let the various parties involved work the details out among themselves. 

4. Under the 1998 Commercial Space Act, the federal government can use excess ICBMs for its 

own use as long as certain conditions are met. This provision was utilized by NASA for the 

LADEE mission. We've recently heard that the procurement for this mission was 

particularly onerous, and resulted in a protracted protest to the GAO. As a result, NASA is 

hesitant to use excess ICBM motors on future missions despite being able to. What can the 
76 

Congress do to make it easier for agencies to utilize existing authorities for using excess 

ICBMs? I HAD HEARD SOMETHING SIMILAR BUT I WAS NOT PRIVY TO THE 

PRECISE DETAILS. I WOULD SUGGEST YOU DISCUSS THIS EPISODE WITH THE 

NASA OFFICIALS INVOLVED AND ASK THEM WHAT RELIEF THEY WOULD 

NEED FROM CONGRESS FOR FUTURE PROCUREMENTS. I WILL SAY AS AN 

OBSERVER OF GOVERNMENT AEROSPACE PROCUREMENT, THAT IN THE PAST 

DECADE ALMOST EVERY PROCUREMENT INYOL YES A CONTENTIOUS 

PROCESS AND ALMOST AUTOMATIC PROTEST BY LOSING BIDDERS. IN MY 

OPINION IT IS BECAUSE AEROSPACE SPENDING HAS BEEN FLAT AND EACH 

PROCUREMENT BECOMES ALMOST A "DO OR DIE" EVENT FOR SOME OF 

THESE COMPANIES. 

If government intrusion on the small launcher market is a concern, then why is the USAF's 

Operationally Responsive Space (ORS) program getting the go-ahead, and building their own 

SLY system? Wouldn't that potentially depress the market more than reusing ICBM motors, 

using taxpayer money to do so? Even so, reusing ICBM motors would take time for 

integration and testing, with no likely immediate impact on current launch demand. The 

introduction of using these motors for commercial uses might even increase demand. 

Globally, our own laws have not stopped particular country competitors from using their 

ICBM inventories to launch commercial SLVs, giving them a pricing advantage to customers 

worldwide (DNEPR=SS-I 8; Rokot's first two stages). 

5. There are many companies intent on developing small satellite launch vehicles, but these are 

not readily available. A paper submitted to the Smallsat 2015 conference suggested that there 

are at least 20 such launch vehicles under development. While there are many in the works, it 

seems that there are many small satellites ready to launch today. How long do you think it is 

reasonable for small satellite manufacturers and operators to wait for these launch vehicles? 

What catalyst should Congress use to determine if and when a policy change is needed to 

meet the demand for domestic launch? IF THESE SMALL SA TS ARE FOR 

GOVERNMENT MISSIONS, CONGRESS SHOULD USE ITS OVERSIGHT 

RESPONSIBILITY TO IMPRESS UPON WHICHEVER GOVERNMENT AGENCIES 

OVERSEEING THESE SMALL SAT PROGRAMS TO FIND THE MOST EXPEDIOUS 

MANNER TO GET THEM ON ORBIT AND EXECUTING THEIR MISSION. IF THE 

SMALL SA TS WAITING FOR RIDES ARE PRIVATELY DEVELOPED AND TO BE 

PRIVATELY OPERA TED, I AM WARY OF THE GOVERNMENT INTERCEDING 

WHERE I THINK THE FREE MARKET WILL PROVIDE SOLUTIONS. 

If we treat this as a commercial market, then it would be unreasonable to expect any 

manufacturer to wait for another to get their actsw+f together. They only do so because they 

have no choice (yet). The investors and owners of these burgeoning companies are basically 

dead in the water while waiting for the opportunity to launch, and expecting them to do so 

would be different from how other sectors work. There's a definite risk to their future if we 
77 

ask them to wait. Would W€-ttSk Ford Toyola to wait for a particular tire manufacturer to 

fulfill an order if that manufacturer where months or years behind? And what would this do 

to those who wish to enter the market, but then see politically-motivated limitations imposed 

on those already trying to build a business? Recommend eliminating the concept of 

"reasonable waiting period." 

6. Foreign launch service providers are seeking to expand their share of the world market. 

a. How will foreign competition affect the U.S. commercial launch services industry 

over the next decade? WITH MORE LAUNCH OPTIONS AVAILABLE, IT WILL 

CERTAINLY FORCE U.S. LAUNCHERS TO BE PRICE AND PERFORMANCE 

COMPETITIVE. AS I SAID IN MY TESTIMONY, THE PROBLEM WILL BE 

WITH FOREIGN LAUNCH PROVIDERS WHO ARE NOT EXACTLY 

TRANSPARENT ABOUT THEIR FUNDING SOURCES AND THEIR LABOR 

RATES. 

b. How are U.S. companies responding to the possibility of increased foreign 

competition in this industry? WITH THE U.S. LAUNCH COMPANIES WE ARE 

SEEING ALMOST CONSTANT IMPROVEMENTS IN VEHICLE DESIGN, 

MANUFACTURING, PROCESSING, COMPONENT SOURCING AND 

ENSURING THEY HAVE THE PROPER SIZED WORKFORCE. NONE OF 

THESE COMPANIES ARE RESTING ON THEIR LAURELS. How should the 

federal government be responding? PROMOTE POLICIES THAT PROVIDE LONG 

TERM STABILITY. THIS INCLUDES SUPPORT FOR MAJOR SPACE 

PROGRAMS ALREADY UNDERWAY AND NEED CONSISTENT SUPPORT. 

ALSO ENSURE IT AR RULES STAY UPDATED AND MODERN AS WELL AS 

FULL SUPPORT FOR EX-IMBANK. INVESTORS AND CUSTOMERS ALIKE 

WILL WANT TO SEE THAT THEY CAN BE CERTAIN BUSINESS DEALINGS 

WITH U.S. COMPANIES ARE RELIABLE, ROUTINE AND TRANSPARENT. 

c. In the 1990s, the United States had bilateral Commercial Space Launch Agreements 

with Russia, China, and Ukraine. More recently, the United States attempted 

unsuccessfully to negotiate a Commercial Space Launch Agreement with India. How 

does the presence or absence of Commercial Space Launch Agreements affect the 

U.S. commercial space launch industry? LIKE THE QUESTION STATES, THESE 

AGREEMENTS WERE TWENTY YEARS AGO WHEN THERE WAS 

EXPECTED TO BE A SURGE DEMAND FOR LAUNCH THAT DID NOT 

MATERIALIZE. ALSO GEOPOLITICS ARE VERY DIFFERENT FROM 

TWENTY YEARS AGO. I WOULD SAY THESE AGREEMENTS ARE OFTEN 

PART OF A LARGER DIPLOMATIC ENGAGEMENT BETWEEN THE U.S. 

AND SAID COUNTERPART NATION. SINCE THE DOMESTIC SPACE 

INDUSTRIAL BASE AND WORKFORCE ARE ESSENTIALLY DUAL-USE FOR 

BOTH CIVILIAN AND NATIONAL SECURITY REASONS, ANY POLICIES 
78 

THAT COULD TAKE BUSINESS AWAY FROM U.S. COMPANIES NEED TO 

BE SERIOUSLY CONSIDERED AND THOUGHT OUT. 

7. The 2013 National Space Transportation Policy states that "the United States will maintain 

its general policy of not supporting the development or acquisition of space transportation 

systems" in countries that are not members of the Missile Technology Control Regime 

(MTCR). India is not a member of the MTCR. A Technology Safeguards Agreement signed 

with India in 2009 permits the granting of export control licenses for civil and noncommercial satellites for launch on Indian launch vehicles, but it maintains a "presumption of 

denial" for export control licenses for commercial satellites. 

a. In 2015, the U.S. company Spire Global received a waiver from the "presumption of 

denial" in order to launch several small satellites on an Indian launch vehicle. At least 

two other U.S. companies have contracted for future Indian launches. What factors in 

the launch market are driving this apparent trend? 

Business-the difference between success and waiting. There is an unprecedented 

demand for launching small satellites, and it is logical for companies to conduct their 

business, instead of spending money while waiting to conduct business. From a 

satellite operator's perspective, any amount oftime a finished satellite spends on 

Earth instead of in orbit is equivalent to lost revenue. Most, if not all, major launch 

providers have a backlog of several years. If an overseas launch provider, whether in 

India or anywhere else, is able to provide a launch sooner and at a competitive price, 

it is the fiduciary duty of the satellite operator's management to make use of that 

option if at all possible. 

b. How would the U.S. space industry be impacted if India joined the MTCR and U.S. 

policy restrictions on India launch services were removed? I (iUESS IT~df 

DEPEND IIDW-i\GGRESIVELY INDIA I'ROI\!OTED Tl!E!R L\U~;CII 

SERVICES TO AMERICA)': SATELLITE O\VNERS 1

0PERATORS WHO NEED 

LAUNCHES AND ARE NOT HAVING TH.\T NfTD MFT DOIVIESTICALLY. IF 

.J.+~~ A YEAR. I DO-NOT SEE A BIG IMPACT. If ON THE OTHER 

}-J.M.,;fl--f#!+!A+W+TRS ROlWST LMJNCH SERVICE:> AT "FlRESALE" 

PRICES. IT COULD BL PROBIDvi\!IC. 

Minimally? India's current launch rate is very low, and they've already been 

soliciting customers globally. Part of this may be due to the time requirements of their 

processes to build and integrate missions. Part of it may be the limitation in launch 

facilities. They don't have many launch facilities, and building more would take time. 

They also need to prove the reliability of the Geosynchronous Satellite Launch 

V chicle (one of the two types of Indian SL V s ), which suffered from two launch 

failures in 2010 and has launched to orbit at a very low rate, nearly once per year, or 

none, since 2010. The often-used Polar Satellite Launch Vehicle (PSL V) has 

launched 26 times in the last ten years, averaging what? About 2.6 launches per year? 

This is not to discount the achievements of India in space, but current trends show 
79 

they have a long way to go to become truly competitive with an increasingly diverse 

U.S. launch market, and in the meantime, our businesses can benefit from their 

services. 

8. In addition to small satellites, many people are talking about the possibilities afforded by 

hosted payloads, especially for DoD purposes. Can explain how small satellites and hosted 

payloads compare and contrast in terms of capabilities? FOR THE MOST PART HOSTED 

PAYLOADS HAVE BEEN EMPLOYED ON LARGE, POWERFUL, MANUEVERABLE 

SA TEL LITES THAT WILL RESIDE IN THE GEO BELT FOR MANY YEARS. SMALL 

SATS ARE NOT VERY POWERFUL, RESIDE IN LEO AND DO NOT STAY IN ORBIT 

VERY LONG. A REAL CONCERN ABOUT SMALL SATS IS THE LACK OF ON 

ORBIT MANEUVERING CAPABILITIES AND SOME DO NOT EVEN HAVE 

TRANSPONDERS THAT CAN SIGNAL THEIR PRECISE POSITION. THIS CAN BE A 

RECIPE FOR COLLISIONS ON ORBIT AND RESULT IN DANGEROUS DEBRIS 

FIELDS. Do small satellite manufactures and launch providers see hosted payloads as 

competition to their sector of the industry? I HAVE NOT HEARD THAT ASSERTION 

BEING MADE. 

9. Several companies are currently developing launch vehicles specifically designed for small 

payloads, as an alternative to the "rideshare" approach of launching small satellites as 

secondary payloads alongside a larger satellite. 

a. What are the advantages and disadvantages of launching a small satellite on a 

dedicated small launch vehicle, rather than as a secondary payload on a larger launch 

vehicle? IF A SMALL SAT HAS TO RIDESHARE, IT IS HELD HOSTAGE TO 

THE NEEDS AND DICTATES OF THE MAIN PAYLOAD IN TERMS OF WHEN 

IT EVENTUALLY GETS TO ORBIT. IF A SMALL SAT CAN HAVE A LAUNCH 

TAILORED TO ITS NEEDS, THEN IT IS NOT HOSTAGE TO ANYTHING BUT 

ITS OWN ABILITY TO BE READY FOR LAUNCH. ALSO SOME SMALL SATS 

WILL HAVE PECULIAR ORBITS TO RESIDE IN WHERE THE LARGER, 

MORE TRADITIONAL SATELLITES NEVER GO TO, THUS RIDES HARE IS 

NOT AN OPTION. 

b. Looking a decade or more into the future, what fraction of the launch demand for 

small satellites do you expect will be met by dedicated small launch vehicles? I 

WOULD SAY ABOUT 50%-50%. NOT ALL THESE SMALL SAT COMPANIES 

AND SMALL LAUNCHER COMPANIES WILL BE AROUND TEN YEARS 

FROM NOW. What factors will determine the balance between dedicated small 

satellite launch vehicles and the "rideshare" approach? HOW WELL THESE NEW 

COMPANIES PERFORM. WHAT WILL BE THEIR FAILURE RATE? WILL 

THEY BE TRULY ABLE TO UNDERCUT THE RISES HARE OPTIONS? ARE 

THEIR ENOUGH SMALL SATS THE REALLY NEED RIDES TO UNUSUAL 

ORBITS? 
80 

c. What federal laws, regulations, or policies (if any) affect industry decision-making 

about how to launch small satellites? THE FAA'S AST OFFICE IS DOING A 

PRETTY GOOD JOB FROM WHAT I'VE SEEN IN TRYING TO REGULATE 

YET HELP "MID-WIFE" THIS EMERGENT PART OF OUR INDUSTRY. I 

HAVE NOT HEARD ANY SPECIFIC COMPLAINTS ABOUT ANY SPECIFIC 

GOVERNMENT POLICY. Would you recommend changes in any of these? JUST 

ENSURE THAT FAA-AST IS FULLY FUNDED. 

I 0. As demand goes up for small satellites and more and more are launched, low Earth orbit will 

become a much more crowded place. Current Inter-Agency Space Debris Coordination 

Committee guidelines say that these satellites must be placed at a low enough orbit that 

atmospheric drag wi II cause them to re-enter 25 years after the end of its mission. Industry 

has said it will follow these guidelines. What is being done on the industry side to ensure that 

its small satellites do indeed follow these orbital guidelines? INDUSTRY IS DOING A 

GOOD JOB ON TRYING TO BE RESPONSIBLE ACTORS IN SPACE. THE SPACE 

DATA ASSOCIATION IS A GOOD EXAMPLE OF THAT. AT THE MOST RECENT 

SPACE SYMPOSIUM, THE SPACE FOUNDATION HELD A SENIMAR ON SPACE 

TRAFFIC MANAGEMENT. ALL OF US AS STAKEHOLDERS KNOW WE CANNOT 

IGNORE THIS ISSUE. l WOULD SAY THAT THERE IS SOME NAIVETE ON THE 

PART OF SOME SMALL SAT COMPANIES BY NOT PUTTING AT THE VERY 

LEAST SOME SORT OF LOCATION BEACON ON THEIR SATELLITES SO ALL 

OTHER ACTORS KNOW WHERE THE SMALL SAT IS AND IF IT POSES A THREAT. 

I I. One drawback of cube satellites is that many lack any kind of propulsion mechanism. As a 

result, they are not maneuverable and can pose a collision risk. There are some technologies 

under development now such as solar sails and solar electric propulsion that can grant some 

amount of mobility to small satellites. How do you see industry standards for collision 

avoidance and end-of-life disposal capabilities evolving? AGAIN, I ECHO MUCH OF 

WHAT I STATE ABOVE. THE MORE ESTABLISHED SATELLITE 

MANUFACTURERS AND OPERA TORS SHOULD ALMOST LOOK TO MENTOR 

THESE NEW COMPANIES AND INSTILL UPON THEM THE NEED FOR THESE 

SMALL SATS THE ABILITY TO TRACKED, IDENTIFIED AND HAVE RESPONSIBLE 

DISPOSAL PROTOCOLS. I WOULD SUGGEST PERHAPS FAA-AST DENY LAUNCH 

LICENSES IF THE PAYLOADS DO NOT MEET SOME MINIMUM STANDARD OF 

THESE. 

12. Some companies like Spire, Digital Globe and One Web plan to launch huge constellations of 

small satellites into orbit. Assuming that the growth in the small satellite market continues, 

do you foresee a time when popular orbits will become too crowded by constellations of 

hundreds or thousands of satellites? Is there talk within the industry about stricter industry 

standards so that debris does not make popular orbits unusable? 
81 

Could orbits be overcrowded one day? Maybe. But current orbital "crowding" has a different 

source than commercial satellites. The majority of satellites launched and orbiting the Earth 

are operated by some branch of government. Based on the FAA's Annual Compendium of 

Commercial Space Transportation: 2016 (page 36), in 2015 alone 53 of 196 satellites (27%) 

launched or deployed were for commercial use. At least 126 of those 196, according to our 

own research, fell into the nanosat/cubesat realm. While there is some concern about orbits 

becoming crowded, some U.S. companies, such as Planet Labs, are making sure their 

satellites do not litter the orbital landscape. In 2015, based on Space-Track data, 17 of 38 

Planet Labs satellites deployed from the ISS have already decayed from orbit. In 2014, I 00% 

of the company's satellites deployed from the ISS decayed. The responsibility taken by the 

company to ensure its satellites do not become part of a congestion and debris problem is 

commendable and hopefully other commercial and government organizations follow suit, 

possibly even agreeing on standardized solutions. 

13. The Satellite Industry Association's 2015 State of the Satellite Industry report mentions a 

·'growing concern regarding collisions with CubeSats," and notes that NASA has had to 

move satellites in order to avoid running into these small satellites. How would you 

characterize the risk associated with CubeSat's in orbit today? ALL I WILL SAY IS THAT 

IT IS WELL KNOWN THAT MANY IN OUR INDUSTRY REFER TO THESE SMALL 

SATS AS "DEBRIS SA TS.'' I THINK THAT SPEAKS VOLUMES AND THE NEED FOR 

US TO ADDRESS THIS INCREASING RISK. 

14. Arizona State University recently published an articJe on its SunCube FemtoSat, a small 

satellite that is 3 centimeters long on each side. Many others have talked about incredibly 

small satellite and 'chipsats' that are weighed in grams. When you look at the trend in 

satellite size, do you see these extremely small satellites becoming more popular? I DO NOT 

SEE THEM PROVIDING ENOUGH CAPABILITY TO HAVE A REAL BUSINESS CASE 

BEHIND THEM AND THUS WILL NOT SEE LARGE FLEETS OF THEM. THEY ARE 

ALMOST RATHER LIKE ONE-OFF EXPERIMENTS TO SEE WHAT CAN BE DONE 

IN TERMS OF DECREASING COMPONENT SIZE. If so, what is industry doing to ensure 

that we can track these very small satellites? THEY MAY NOT BE TRACKABLE. I 

WOULD LOOK INTO MANDATING THAT THESE WOULD BE SENT TO LESS 

PO PULA TED ORBITS WHERE THE CHANCES OF COLLISION IS LESS. Do you 

envision a commercial need for space situational awareness information and services beyond 

what the Air Force currently provides to the public free-of-charge? YES. I THINK WE SEE 

THE NEED FOR SPACE TRAFFIC MANAGEMENT AND GET THE USAF OUT OF 

BEING THE FAA FOR SPACE. SOME SORT OF COMMERCIAL/US GOVERNMENT 

CIVILIAN JOINT EFFORT IS THE GOAL. THE HARD PART IS HOW DO WE 

ACTUALLY GET THERE. 
82 

15. Small satellite technology can serve both commercial and scientific interests. When you look 

at where investments are being made in small satellites, is it mostly with an eye to the 

commercial benefits or do more end users plan to use them for scientific purposes like 

research and technology development? 

Slightly more than half, 65, of the 126 small satellites launched in 2015 were for some kind 

of experiment or technology demonstration. Fully 46 of the 126 were for commercial 

imagery (Planet Labs). If other companies implement plans and manage to launch small 

satellites for space-based communications networks, other imagery constellations, automated 

identification systems, forest fire detection networks, and more, then the balance of small 

satellites would likely tilt greatly towards commercial products. 

16. Last summer, NASA announced that it would be sending two CubeSats to Mars. The twin 

communications-relay satellites are to be built by NASA's Jet Propulsion Laboratory and 

will launch as secondary payloads to the InSight lander. This mission will be the first time 

that CubeSats have flown into deep space. The vast majority of CubeSats are placed into low 

Earth orbit. Does industry have any plans to move beyond this orbit, out into deep space? 

NOT UNTIL THERE IS BUSINESS CASE WHERE THESE SMALL SA TS GOING TO 

DEEP SPACE PROVIDES A MEASUREABLE RETURN ON INVESTMENT. PERHAPS 

AS SCOUTING PROBES FOR MINING OF ASTEROID COULD BE A REASON. 

17. NASA has several programs dedicated to the development of small satellites including its 

CubeSat Launch Initiative and Venture Class Launch Program. Can you please describe what 

the commercial industry's experience has been working with NASA and other government 

agencies in developing small satellites and launch? NASA IS NOT ALWAYS THE 

EASIEST PARTNER TO HAVE, THAT SAID, THEY SHOULD BE COMMENDED FOR 

STARTING THESE PROGRAMS. TO DATE I HAVE NOT LEARNED OF ANY 

TROUBLES ON THESE PROGRAMS. What policy recommendations do you have that 

could better serve American interests and promote the continued development of small 

satellite and launch technology? ENGAGE AND INVEST WITH SCHOOLS. GIVE 

YOUNG AMERICANS THE OPPORTUNITY TO WORK ON THESE PROGRAMS AND 

GIVE THEM EXPERIENCE THAT HELPS THEM ENTER THE SPACE WORKFORCE 

BETTER PREPARED. 

18. In May of last year, the chairman of the Surrey Satellite Technology Ltd., Martin Sweeting, 

warned that there might be too much "heady enthusiasm" when it comes to CubeSats. 

SpaceNews called his comments a warning about a CubeSat bubble. Are CubeSats a 

sustainable business model, or is this just a Silicon Valley fad? AS I MENTIONED IN MY 

TESTIMONY AT THE HEARING, I DO SEE SOME SIMILARITIES TO THE LITTLE 

LEO BUBBLE OF THE 1990'S AND EARLY 2000'S. THAT SAID, THERE HAVE BEEN 

IMPROVEMENTS IN TECHNOLOGY THAT COULD ENABLE SOME OF THESE 

PROVIDERS A SUCCSSEFUL BUSINESS CASE. I DO NOT THINK THERE WILL BE 

DOZENS AND DOZENS OF SMALL SAT COMPANIES, BUT RATHER AN EXPLICIT 

NICHE IN THE SPACE INDUSTRY WITH A HANDFUL OF PROVIDERS. What kind of 

timeline are investors in CubeSats looking at? BEING THAT MANY OF THESE ARE 
83 

FROM SILICON VALLEY. I WOULD SAY THEY ARE USED TO RELATIVELY 

SI!ORT Rf":TURN. MONTHS TO/\ FEW YEARS AT THE VERY MOST.NCED A ~TIF 

~FR HFRE PbRl!APS? 

19. NASA's Launch Services Program is actively trying to develop the small satellite 

commercial launch industry as an alternative to rideshare opportunities. Small satellite launch 

vehicles, like the ones proposed by Firefly, Virgin Galactic, and Rocket Lab, seem to be well 

suited to launching venture class missions. When looking at the market, do small satellite 

launch service providers see NASA as their primary customer or anchor tenant? I THINK 

FROM THE STANDPOINT OF ATTRACTING INVESTORS, A COMPANY THAT HAS 

NASA AS AN "ANCHOR TENANT" IS VERY HELPFUL. THE NASA "BRAND", IF 

YOU WILL, STILL CARRIES TREMENDOUS POSITIVE CREDIBILITY. I THINK 

NASA TECHNICAL EXPERTISE CAN BE HELPFUL AS WELL. Can you describe the 

demographic interested in small satellite launch services? I THINK THIS WILL BE 

OPERA TORS WHO OFFER VERY SPECIALIZED AND NOT EXQUISITE ON ORBIT 

CAPABILITIES IN TERMS OF PRIMARILY REMOTE SENSING, AND 

COMMUNICATIONS. 

Several people have called the development of CubeSats a revolution in satellite technology. 

According to the Satellite Industry Association's "State of the Satellite Industry Report" 63 

percent of all satellites launched in 2015 were CubeSats. This is an impressive number. And 

yet while most of the satellites launched were CubeSats, they only made up less than I 

percent of the total market value of all the spacecraft launched. Can you give us a sense of 

scale for how big this revolution really is? What kind of economic impact are investors 

foreseeing in small satellite manufacturing and launch? 

Cubesat deployment numbers have been growing. The ISS alone demonstrates this with its 

satellite deployment rates, the majority of which involved cubesats. Five years ago, the ISS 

deployed one satellite. In 2012 and 2013, a total of 10 satellites were deployed. In 2014 and 

2015, deployments nearly reached 50 cubesats each year. This year, 30 have already been 

deployed. Traditional orbital launch vehicles are also making use of cubesat deployers. In 

2014, one Russian Dnepr deployed 33 satellites, many of which were cubesats, one of which 

deployed 4 more satellites. In 2015, an Atlas V deployed about 35 satellites, one Long March 

deployed 20, and a Soyuz deployed 20. Each year, other launchers also deployed cubesats, 

showing one of the cubesat's strengths as a standardized satellite bus. This year, maybe as 

soon as July, a Falcon 9 will deploy more than 80 satellites from a Spaceflight Industries 

Sherpa deployer. 

There is nothing really revolutionary about cubesats themselves. The technology cubesats are 

based on has existed for decades. The critical factor is the affordability, customization, and 

risk-minimization presented by cubesats. These reasons alone are inviting many more 

participants into the space industry, particularly those not necessarily interested in operating 

satellites, but interested in gaining data collected from them. Due to the inexpensive nature of 

cubesats, even large constellations may not have a substantial impact on the satellite 
84 

manufacturing and launch industry. The focus should be on the businesses that are supported 

by the capabilities that these cubesats offer, since that is where we are most likely to see 

revenue growth. 

20. Space Works' 2016 Nano and Microsatellite Market forecast predicts that as many as 3,000 

nano and microsatellites will require a launch in the next six years. The report concludes that 

"the industry has a need for small launch vehicles." There are a number of such vehicles 

under development by U.S. companies. Even if new U.S. vehicles enter the market, will U.S. 

domestic launch vehicles alone will be able to meet forecasted demand? 

It is doubtful the U.S. domestic launch vehicles could meet the demand. Combined with the 

ISS deployments, 126 small satellites were deployed in 2015 using global launch industry 

resources. If that deployment tempo remained the same, it would take more than six years to 

deploy 3000 small satellites. 

The previous example of the Sherpa deployer gives us some idea of launch capability 

possible for small satellites. If an 80-cubesat deployer were launched 12 times a year, and 

successfully deployed payloads, that would result in 960 cubesats in orbit each year. Small sat 

launchers like Rocket Lab seem to be advertising a launch rate of about twice a quarter, with 

each launch able to deploy about 32 cubesats. That would be 256 cubesats deployed in one 

year. If 3,000 satellites are to be launched in the next six years, the global launch industry 

would probably need to be involved to keep small satellite businesses alive. 

21. In March of last year, the International Telecommunication Union held a conference in 

Geneva to discuss challenges facing the development of small satellites including frequency 

management and radio communication standardization. Out of that conference came a 

document called the "Prague Declaration" that confirms the "importance of implementing 

national legal and regulatory frameworks in conformity with international laws, regulations, 

guidelines and procedures." What are the major radio communication policies impacting the 

small satellite industry? 

This is not an area that we have studied. However, there is research underway to develop 

laser-based communications hardware for use in cubesats, which may alleviate some of the 

concerns about spectrum management. Even assuming the R&D goes well, it is likely to take 

at least several years before such systems are affordable and widespread. 

22. The Federal Communications Commission licenses spectrum in the form of radio 

communication for satellites under three different categories: amateur, experimental and 

professional or operational. According to SpaceNews, the fee to license an experimental 

satellite is $430,000. The fee to license an amateur satellite is $60. It seems clear why most 

small satellite operators choose to purchase an amateur license. What kinds offrequency 
85 

issues are influencing the industry right now? Can you talk about this discrepancy in 

licensing prices? Does this inhibit the growth of the small satellite industry? 

This is not an area that we have studied, but lower startup costs generally make it easier for 

new satellite companies to begin operations. 

23. What are the differences of the U.S. government's role in space launch promotion for use in 

commercial space launch twenty years ago and now? I AM NOT SO SURE THERE IS 

THAT MUCH DIFFERENCE. THE GOVERNMENT STILL HAS TO MAINTAIN AND 

OPERATE THE LAUNCH RANGES. THE GOVERNMENT STILL HAS AN INTEREST 

IN A ROBUST WORKFORCE AND INDUSTRIAL BASE. THERE IS ALSO A NEED 

FOR THE GOVERNMENT TO HAVE SOME MODICUM OF CHOICE AND VARIETY 

IN PROVIDERS AS WELL. THUS THE POLICIES IT ALREADY HAS OR DEVELOPS 

NEEDS TO HELP ENSURE THE AFOREMENTIONED. Are the drivers for space assets 

and products different and/or bigger now than they were twenty years ago? PAYLOADS 

ARE MUCH MORE CAPABLE, BUT THEY STILL PROVIDE CAPABILITIES THAT 

WE NEED HERE ON EARTH. PRIMARILY COMMUNICATIONS AND EARTH 

OBSERVATIONS. 

24. Many of the companies we see entering the small satellite market are startups in Silicon 

Valley. This 'new space' industry has a very different look and feel from older aerospace 

companies and satellite manufactures. How would you characterize the small satellite 

workforce? This is not an area that we have studied.STIF ANSWER Are these new space 

startups positively impacting the employment and training pipeline for STEM students and 

recent graduates? This is not an area that v\e have studied.snr ANSWER 

25. The number of small satellites and CubeSats launched in the past few years has skyrocketed. 

There is an entire industry developing just to serve the small satellite and Cube Sat 

community- including manufacturing, launch, and value-added data products. Can you give 

us a sense of how the small satellite industry is impacting job creation? 

Our space workforce reports are largely based on data from the U.S. Bureau of Labor 

Statistics, which does not provide sufficient detail to answer this question. An additional 

complication is that new companies that provide analysis of satellite imagery or customized 

tools for end-users may be recorded as software companies or something else instead of 

"space companies" in government-collected data sets. This speaks to the growing reach of 

space as it is integrated into other industries. 
86 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

Questions submitted by Rep. Barbara Comstock 

1. To any witness: As you all are aware, it is not unusual for the federal government, 

including both DOD and NASA, to make surplus government property and assets 

available to commercial users in order to save taxpayers money and support U.S. 

businesses. I think there is a broad consensus that making use of surplus assets when 

done in a transparent and competitive manner, is in the national interest. 

In recent years, both the Air Force and NASA have made a tremendous amount of federal 

launch property available to commercial users at Cape Canaveral and Kennedy Space 

Center, often at extremely discounted rates, in the name of removing the maintenance 

costs from the government books as well as encouraging greater use of the launch 

complexes. This has included multiple launch pads, processing facilities and other 

property which was built or acquired at significant taxpayer expense. 

When these federal assets were made available to launch companies, there was little 

debate about doing so- despite the fact that it directly competed with state spaceports, 

like MARS, Alaska, and others, who were developing similar capabilities with state and 

private investment and competing for the same customers that were given valuable 

federal property under very generous terms. 
87 

Given that the government policy for this ground infrastructure has been to make surplus 

assets available to commercial customers at below market rates, why is there opposition 

to allowing a restricted number of decommissioned motors available to commercial 

providers at fair market value? Can you clarify how some commercial launch providers 

readily accepted surplus ground infrastructure but are now opposing a similar policy 

when it comes to excess motors? This is not an area that we have studied.Nid2D TO BE 

C.'\REFUL LET ME Til INK ABOUT TillS ONE A LITTLE MORE 

2. As the committee reviews this issue, Members have a fiduciary responsibility to act in the 

best interest of taxpayers as well as to determine what is in the best interest of our 

national security. 

From both of these perspectives, it appears that it is in the Air Force's interest to reduce 

its stockpile of decommissioned motors in a responsible manner by reducing annual 

maintenance costs and avoiding the costly process of responsibly destroying these 

engines. 

The taxpayers would also benefit from having more immediate, low-cost launch options 

from a variety of spaceports, which already have the launch pad and ground infrastructure 

in place to launch these vehicles to launch NASA and NOAA payloads on a commercial 

contract. 

Would you agree that using these decommissioned motors in such a manner is ultimately 

in the best interest of both the taxpayer, the Defense Department and customers who need 

immediate affordable launch options? This is not an area that we have studied.NEED TO 

H-t;-GARE.JC.:~T-M¥,++1~-l·HIS ONE A I .ITTLE M(:)R+; 
88 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

Questions submitted by Rep. Jim Bridenstine 

I. You caution to not be overly bullish about emerging small satellite demand. Last year, we 

had a lapse in the Export-Import Bank in this country. Do you see lack of available 

export financing as an obstacle this industry faces in reaching its potential? ANY 

CONTINUED HINDERING OF THE EX-IMBANK HURTS ALL OF U.S. 

AEROSPACE COMMERCE. 
89 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

Mr. Elliot Pulham, Chief Executive Officer, Space Foundation 

Questions submitted by Rep. Donna Edwards. Ranking Member, Subcommittee on Space 

I. In response to a question from Mr. Perlmutter on the importance of the International 

Space Station's (ISS) capability to deploy small satellites for educational institutions and 

space research, you stated that such a capability was very important. In light of the 

possibi I ity that ISS operations will cease in 2024 and the importance you place on this 

current capability, how would you suggest we start planning for the transition of this 

important user community to future launch options? FROM WHAT I HAVE SEEN IN 

THE PUBLIC DOMAIN, ISS COULD REMAIN IN ORBIT WELL INTO 2028. I 

WOULD SUGGEST SOME THOUGHT BE GIVEN TO EXTENDING ISS. AS FOR 

OTHER LAUNCH OPTIONS, THERE ARE COMPANIES THAT ARE SEEKING 

OUT PAYLOADS FROM EDUCATION INSTITUTIONS TO PROVIDE FREE OR 

EXTREMELY REDUCED COST RIDEALONGS. 
90 

2. In your response to that same question, you indicated that companies were starting to 

think of philanthropic solutions to the challenge of sending student payloads into space. 

You cited launch companies possibly devoting excess payload capacity space for 

smallsats and even dedicating an entire launch for university projects. 

a. How can companies be encouraged to make their excess payload capacity 

available to academic institutions? I DO NOT THINK THEY NEED MUCH 

ENCOURAGEMENT. MANY COMPANIES SEE THESE AS 

OPPORTUNITIES TO MARKET THEMSEL YES TO THIS NEXT 

GENERATION WORKFORCE. 

b. How could companies and academic institutions develop a process which would 

allow excess payload capacity to be matched with small payloads seeking a lowcost ride to space? AGAIN, THESE COMPANIES WANT TO BE GOOD 

CORPORATE CITIZENS AND THEY ARE VERY EAGER TO ENGAGE 

WITH STUDENTS INTERESTED IN SPACE WHO COULD BECOME THEIR 

NEXT GENERATION EMPLOYEES AND INNOVATORS. THEY ARE 

ALREADY ENGAGING WITH A VARIETY OF INSTITUTIONS. 

3. During the hearing, Mr. Perlmutter raised the question of whether or not excess ICBMs 

might be used for government missions such as for addressing orbital debris. 

a. What is your response to this proposal? IF THERE IS A GOVERNMENT 

DEVELOPED PAYLOAD THAT CAN HELP "CLEAN UP" ORBIT, 

PERHAPS FLYING THAT SYSTEM ON SUCH LAUNCHERS MAKES 

SENSE. 

b. Should excess ICBMs be considered for the philanthropic uses you mentioned in 

the hearing, such as for dedicated launches of university payloads? I THINK 

THAT IS AN IDEA THAT BEARS SOME CONSIDERATION. THE COSTS 

OF THE BOOSTERS WOULD STILL BE PRETTY STEEP EVEN FOR THE 

WEALTHIEST UNIVERSITIES, AS SUCH THE GOVERNMENT WOULD 

PROBABLY BE GIVING THEM AWAY. 
91 

Responses by Mr. Eric Stallmer 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and 

Challenges 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation 

Questions submitted by Rep. Brian Babin, Chairman, Subcommittee on Space 

1. The Federal Aviation Administration Office of Commercial Space Transportation 

(FAA AST) and its Commercial Space Transportation Advisory Committee 

(COMSTAC) publish annual10-year forecasts of demand for commercial launch 

services. The April 2015 forecasts project that commercial launches to 

geosynchronous orbit will increase from 16 per year in 2015 to 18 per year in 

2017, while launches to other orbits will peak at 19 per year in 2016 and 2017 

before dropping off to 10 or 11 per year in 2020 and beyond. 

a. How consistent are these projections with your own expectations about 

the commercial space launch industry? What industry trends have you 

observed that might result in higher or lower launch rates? 

When measuring the consistency between CSF's expectation for commercial space 

launch demand and the 10-yearforecasts in the FAAIAST-COMSTAC's April 2015 

Report, it is important to take into account factors that contextua/ize the Report's 

demand forecast: 

1. The Report's launch forecast projection is based on publicly announced launch 

demand at the time of the Report's research and writing, which was in 2014. 

While this is no fault of the Report, it's data is at least two years old and fails to 

take into account many of the new U.S. launch company contracts announced 

over the previous two years. These include, but are not limited to, the following: 

a. Virgin Galactic's deals for: 39 launches of One Web satellites; and 1 

launch of NASA small satellites under its Venture Class Launch Services 

contract. 

b. Rocket Lab's deals for: 3 launches of Planet (formerly Planet Labs) 

satellites; 31aunches for Moon Express; up to 121aunches of Spire 

satellites, and 1 launch of NASA small satellites under its Venture Class 

Launch Services contract. 

c. Firefly's deal for: 1 launch of NASA small satellites under its Venture Class 

Launch Services contract. 
92 

d. SpaceX's deal for launching Spaceflight Industries' SHERPA (89 

satellites). 

2. The Report utilizes what it refers to as a "realization factor" in its forecast 

calculations- which the annual forecast has used since the "realization factor's" 

inception in 2002 - whose methodology may not be valid to forecast emerging 

markets. For instance, the "realization factor" methodology is derived by 

comparing forecast satellite launches with actual satellites launched in the five 

years prior to the Report. This methodology is more appropriate to apply to 

forecast for mature, stable, and predictable markets, like the existing 

geostationary (GSO) satellite telecommunications market. But for nascent 

markets that are expanding, like the emerging new satellites constellations in the 

non-geostationary (NGSO) satellite market, utilizing the previous fives year 

launch average to forecast the next 10 years is most likely to under forecast the 

future. It's like taking a growing teenager's average height over the previous five 

years and applying it to calculate their height for the next 10 years- that 

methodology is likely to drastically underestimate their annual height over the 

next 10 years. 

While the Report's forecast is consistent with our expectations with regard to mature 

markets, like GSO telecommunication satellites and commercial crew and cargo flight to 

the ISS, its forecast does not adequately calculate the growing and emerging markets, 

like new satellites constellations, for the reasons outlined above. 

b. The April 2015 forecasts project growth in the number of micro- and smallclass payloads, but project that these will be launched in clusters, so that 

there will be little net effect on the demand for launches. How consistent is 

this with your own observations of the industry? 

The April 2015 Report fails to adequately project the demand for dedicated launch 

demand of micro- and small-class satellite for the reasons outlined in the previous 

answer. 

c. Considering the FAA AST and COMSTAC forecasts, as well as your own 

observations and experience, how likely is it that the demand for 

commercial space launch services over the next decade will be sufficient 

to support a healthy U.S. space launch industry? How would you define a 

"healthy'' U.S. space launch industry? What do you consider to be the 

greatest risks for the industry over the next decade? 

A healthy U.S. space launch industry is one with multiple launch suppliers and multiple 
93 

satellite operators, governed by policies that promote regulatory stability, fair and open 

competition, efficiency, and innovation. By consistently reaffirming 30 years of U.S. 

commercia/launch policy (preventing U.S. government launch assets from competing 

against the private sector), improving regulatory stability, and promoting pro-growth 

policies, the United States Government has, thus far, fostered a healthy development of 

U.S. commercia/launch service providers and users-and we are seeing this policy 

bear fruit today. As noted in my answer to question 1 (a), a review of recent launch 

service contracts illustrate that U.S. commercial launch service providers are very 

effectively meeting the needs of commercial and international users of commercial 

launch services. 

Policies that prevent or undermine fair and open competition is one of the greatest risks 

for the industry. This kind of market intervention would send a negative signal to 

investors: don't put your money in U.S. launch vehicle companies. The result: a weaker 

U.S. rocket propulsion industrial base, less innovation from start-up companies, fewer 

new technologies, and a less robust U.S. launch industry. 

2. The FAA AST and COMST AC forecasts project that commercial crew and cargo 

resupply missions to the International Space Station (ISS) will account for a 

majority of the commercial launches to non-geosynchronous orbits over the next 

decade, rising to 70 percent or 80 percent of the market in 2020 and beyond. 

a. How consistent are these projections with your own forecasts? 

The April 2015 Report fails to adequately project the demand for dedicated launch 

demand of micro- and small-class satellite for the reasons outlined in the previous 

answer. 

b. Although these crew and cargo missions to the ISS are considered 

commercial, the customer is a federal agency, NASA. How might 

increasing reliance on a single government customer affect the 

commercial space launch industry? 

I respectfully disagree with the premise that underpins the question for the reasons that 

I outlined in my answer to question 2(a). 

c. U.S. use of the ISS is currently authorized through at least 2024 (P.L 114-

90, Sec. 114(b)). When ISS operations end, how will the consequent 

reduction in demand affect the commercial space launch industry? 

NASA's Bill Gernstenmaier in July 2016 testified before Congress that NASA will 

continue to require commercial space transportation services to LEO even after ISS 
94 

operations end (this includes 2024 and 2028 deadlines). In addition, we anticipate 

additional commercial activity in LEO to expand over the next decade, which will require 

commercial space launch services post-ISS as well. Beyond this general demand it is 

too early to better predict post-ISS demand. It better understand post-ISS demand it 

may be useful for the committee to hold a hearing on the matter. 

3. Earlier this year, SpaceX launched a cargo resupply mission to the ISS and, for 

the first time, landed the first stage of the launch vehicle on a floating platform in 

the Atlantic Ocean. The company plans to refurbish and reuse the first stage in a 

future launch and expects this practice to reduce launch costs. 

a. If the company's plans for reusability are successful, how might that affect 

the rest of the commercial launch industry? 

I defer to SpaceX on this matter. 

b. How sensitive is the commercial launch market to launch costs? How 

much potential is there for growth in launch demand, if launch costs can 

be reduced? 

The Space Angels Network, which is the leading source of capital for early-stage space 

companies, states that the "exponential growth in entrepreneurial activity and 

investment in space is underpinned and enabled primarily by the emergence of low-cost 

access to space ... a number of new launch companies are innovating at an incredible 

pace, driving efficiency through standardization, and accessibility through transparency, 

ultimately brining the cost down and the space sector within the reach of startups and 

entrepreneurs for the first time. "

1 

c. What are the key steps in refurbishing a rocket for reuse? 

Multiple companies within the commercial space industry are working on the challenges 

of reusability. Because of the different approaches, each company has developed 

different methods (and therefore different steps for refurbishment) for reusability. The 

specific steps depend on an array of factors including altitude and payload capability. 

Many of the vehicles are vastly different and cannot therefore adhere to one set of 

steps. 

d. What changes, if any, are needed in current federal licensing and 

oversight to address the potential reuse of refurbished rockets? 

1 http://spaceangelsnetwork. com/20 16/06/12/commercial-use-of-icbms-impact-toinvestment-community/ 
95 

CSF is working with its member companies on to figure out whether changes, if any, are 

needed, and looks forward to providing the Committee more constructive feedback on 

this matter in the future. 

e. What concerns might potential customers have about launching their 

payloads on a refurbished launch vehicle? How could a launch company 

address those concerns? Is there any federal role in facilitating this 

interaction? 

CSF defers to the individual companies working on reusability, and their potential 

customers, to answer this question. 

4. Under the 1998 Commercial Space Act, the federal government can use excess 

ICBMs for its own use as long as certain conditions are met. This provision was 

utilized by NASA for the LADEE mission. This procurement resulted in a 

protracted protest to the GAO. As a result, NASA is hesitant to use excess ICBM 

motors on future missions despite the fact that it is permissible. What can the 

Congress do to make it easier for agencies to utilize existing authorities for using 

excess ICBMs? 

I respectfully disagree with the premise that underpins the question, as there is no 

official statement or public record of NASA stating any hesitancy regarding government 

use of excess ICBM-derived launch vehicles. And if NASA follows all the requirements 

outlined in the 1998 Commercial Space Act for government procurement of excess 

ICBM-derived launch vehicles, then it should have no concerns, as its decision would 

be vindicated by any potential GAO review. 

5. There are many companies intent on developing small satellite launch vehicles, 

but have yet to launch. A paper submitted to the Smallsat 2015 conference 

suggested that there are at least 20 such launch vehicles under development. 

While there are many in the works, it seems that there are many small satellites 

ready to launch today. How long do you think it is reasonable for small satellite 

manufacturers and operators to wait for these launch vehicles? What catalyst 

should Congress use to determine if and when a policy change is needed to 

meet the demand for domestic launch? 

Domestic launch capability is already available for sub-500kg performance. This year 

Orbital ATK's Minotaur-C (commercial variant of the Minotaur launch vehicle family) will 
96 

aggregate and launch 6 Skysat small satellites, which weigh 120 kg each, to Sun 

Synchronous Orbit (SSO). Similarly, SpaceX's Falcon 9 will launch Spaceflight 

Industries SHERPA spacecraft and payload adapter, which will launch 87 small 

satellites that are up to 500kg to LEO. In addition, additional domestic launch options for 

sub-500kg satellites will be coming online soon, including services by Virgin Galactic, 

Firefly, Vulcan Aerospace, Masten Space Systems, and Rocket Lab. 

American industry is responding to market demand and innovating on new 

technologies, outpacing any other nation in the world. Per my written testimony, small 

satellite operators believe that the maintenance of current policies is the best way to 

meet their demand for domestic launch. 

6. Foreign launch service providers are seeking to expand their share of the world 

market. 

a. How will foreign competition affect the U.S. commercial launch services 

industry over the next decade? 

Foreign launch service providers have lost significant share of the commercial market to 

US. launch service providers over the past 5 years; a positive trend that is anticipated 

to continue, especially in the small satellite market. The expansion of US. launch 

service providers expanding their share of the commercial market is detailed below: 

a. The 500-2000 kg commercial and internationally competitive satellite 

market has been a relatively small portion of the overall commercial 

launch market over the past 20 years. This market has been dominated by 

the deployment of three satellite constellations (Giobalstar, Iridium, and 

03b) on multi-manifested missions by vehicles with greater capability than 

repurposed ICBMs and international small launch vehicles. Not including 

these constellations, launch demand in this market is projected to fall on 

average to less than two payloads per year. In the near future, the FAA 

Commercial Space Transportation Advisory Committee projects that US. 

based launch systems will dominate the 500-2000 kg commercial satellite 

market due to the deployment of the Iridium Next constellation. 

b. The 1-500 kg commercial and internationally competitive satellite market 

has been a very small portion of the overall commercia/launch market 

over the past 20 years. This market has been dominated by the 

deployment of one satellite constellation (ORBCOMM) on multimanifested missions using US. -based launch systems. Not including the 

ORBCOMM constellation, launch demand in this market is projected to 

increase for dedicated small satellite launch vehicles. In the near future, 

US. based launch systems will dominate the 1-500 kg commercial 

satellite market due to the deployment of several new constellations 

(OneWeb, SHERPA, Terra Bella, Planet, Spire, BlackSky, Planetary 

Resources). 
97 

2. American industry is responding to market demand and innovating new 

technologies, outpacing any other nation in the world. If the Committee wants to 

American industry to maintain this lead and prevent foreign competitors from 

catching up then it should continue to affirm 30 years of US. commercia/launch 

policy, improve regulatory stability, and promote pro-growth policies. This 

includes: 

a. Strongly opposing any change to the existing policy with respect to the 

commercial use of excess ICBM assets; and 

b. Retaining the current case-by-case waiver process. 

b. How are U.S. companies responding to the possibility of increased foreign 

competition in this industry? How should the federal government be 

responding? 

CSF opposes any chanfle to the current US. policy with respect to launch on Indian 

launch vehicle systems. 

c. In the 1990s, the United States had bilateral Commercial Space Launch 

Agreements with Russia, China, and Ukraine. More recently, the United 

States attempted unsuccessfully to negotiate a Commercial Space Launch 

Agreement with India. How does the presence or absence of Commercial 

Space Launch Agreements affect the U.S. commercial space launch 

industry? How does it affect the U.S. commercial satellite industry? 

CSF strongly supports implementation of effective mechanisms for restricting foreign 

governments from imposing unfair and anti-competitive practices against the US. 

commercial space industry. 

7. The 2013 National Space Transportation Policy states that "the United States will 

maintain its general policy of not supporting the development or acquisition of 

space transportation systems" in countries that are not members of the Missile 

Technology Control Regime(MTCR). India is not a member of the MTCR. A 

Technology Safeguards Agreement signed with India in 2009 permits the 

granting of export control licenses for civil and non--commercial satellites for 

launch on Indian launch vehicles, but it maintains a "presumption of denial" for 

export control licenses for commercial satellites. 

a. In 2015, the U.S. company Spire Global received a waiver from the 

"presumption of denial" in order to launch several small satellites on an 

Indian launch vehicle. At least two other U.S. companies have contracted 
98 

for future Indian launches. What factors in the launch market are driving 

this apparent trend? 

Outside of small launcher capacity and dedicated bundled flights, many small satellites 

today fly as secondary or auxiliary payloads on launch vehicles designed for much 

larger satellites. Although the market is responding with the development of new smallclass rockets, there are limited options for dedicated launch vehicles today that allow 

small satellites to be the primary, or lead, payload. While small satellite customers 

benefit from being a secondary payload through fractional pricing relative to the price of 

a dedicated launch service, CSF acknowledges that status as a secondary or auxiliary 

payload does sometimes result in tradeoffs for the small satellites customer. 

b. How would the U.S. space industry be impacted if India joined the MTCR 

and U.S. policy restrictions on India launch services were removed? 

CSF strongly supports implementation of effective mechanisms for restricting foreign 

governments from imposing unfair and anti-competitive practices against the U.S. 

commercial space industry. 

8. In addition to small satellites, many people are talking about the possibilities 

afforded by hosted payloads, especially for DoD purposes. Can you explain how 

small satellites and hosted payloads compare and contrast in terms of 

capabilities? Do small satellite manufactures and launch providers see hosted 

payloads as competition to their sector of the industry? 

CSF strongly supports the U.S. Government's use of commercial services via small 

satellites, hosted payloads, high altitude platforms, and other commercial platforms that 

can help meet and augment its service needs, improve its uninterrupted collection of 

data, lower costs, and increase resiliency. 

9. Several companies are currently developing launch vehicles specifically 

designed for small payloads, as an alternative to the "rideshare" approach of 

launching small satellites as secondary payloads alongside a larger satellite. 

a. What are the advantages and disadvantages of launching a small satellite 

on a dedicated small launch vehicle, rather than as a secondary payload 

on a larger launch vehicle? 

The primary advantage afforded by launching a small satellite on a dedicated small 

launch vehicle is that the small satellite is a primary payload, not a secondary payload. 

Launched as a secondary payload, the small satelfite is at the mercy of the primary 
99 

payload in terms of launch schedule and orbital placement. It goes wherever the larger 

primary payload goes, regardless of whether or not that is the optimal orbital injection 

for the completion of the mission of the satellite. On a dedicated launch vehicle, the 

operators of those satellites can choose where their satellites will go. 

The main disadvantage is a potentia/loss in economies of scale. For CubeSats where 

the exact orbit is less important, the most cost-effective launch method could still be as 

a secondary payload on a larger launch vehicle. This is already taken into account in 

the prices of the two respective launch services. Individual satellite companies should 

have the freedom to choose which launch service best fits with their business model. 

b. Looking a decade or more into the future, what fraction of the launch 

demand for small satellites do you expect will be met by dedicated small 

launch vehicles? What factors will determine the balance between 

dedicated small satellite launch vehicles and the "rideshare" approach? 

It is too early to tell. The nascent small satellite market is still working through what is 

the right balance, which may vary by individual company based on their unique 

business case needs. With that said, if the U.S. government were to flood the market 

with cheap government motors and tilt the playing field away from the commercial 

dedicated small satellite launch vehicle industry, there may not be an opportunity in the 

future for companies to make that choice. 

c. What federal laws, regulations, or policies (if any) affect industry decisionmaking about how to launch small satellites? Would you recommend 

changes in any of these 

CSF is working with its member companies on to figure out whether changes, if any, are 

needed, and looks forward to providing the Committee more constructive feedback on 

this matter in the future. 

10. As demand goes up for small satellites and more and more are launched, low 

Earth orbit will become a much more crowded place. Current Inter-Agency Space 

Debris Coordination Committee guidelines say that these satellites must be 

placed at a low enough orbit that atmospheric drag will cause them to re-enter 25 

years after the end of its mission. Industry has said it will follow these guidelines. 

What is being done on the industry side to ensure that its small satellites do 

indeed follow these orbital guidelines? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 
100 

11 . One drawback of cube satellites is that many lack any kind of propulsion 

mechanism. As a result, they are not maneuverable and can pose a collision risk. 

There are some technologies under development now such as solar sails and 

solar electric propulsion that can grant some amount of mobility to small 

satellites. How do you see industry standards for collision avoidance and end-oflife disposal capabilities evolving? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

12. Some companies like Spire, Digital Globe and One Web plan to launch huge 

constellations of small satellites into orbit. Assuming that the growth in the small 

satellite market continues, do you foresee a time when popular orbits will become 

too crowded by constellations of hundreds or thousands of satellites? Is there 

talk within the industry about stricter industry standards so that debris does not 

make popular orbits unusable? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

13. The Satellite Industry Association's 2015 State of the Satellite Industry report 

mentions a "growing concern regarding collisions with CubeSats," and notes that 

NASA has had to move satellites in order to avoid running into these small 

satellites. How would you characterize the risk associated with CubeSat's in orbit 

today? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

14.Arizona State University recently published an article on its SunCube FemtoSat, 

a small satellite that is 3 centimeters long on each side. Many others have talked 

about incredibly small satellite and 'chipsats' that are weighed in grams. When 

you look at the trend in satellite size, do you see these extremely small satellites 

becoming more popular? If so, what is industry doing to ensure that we can track 

these very small satellites? Do you envision a commercial need for space 

situational awareness information and services beyond what the Air Force 

currently provides to the public free-of-charge? 
101 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

15. Small satellite technology can serve both commercial and scientific interests. 

When you look at where investments are being made in small satellites, is it 

mostly with an eye to the commercial benefits or do more end users plan to use 

them for scientific purposes like research and technology development? 

CSF defers to the individual companies working on small satellite technology, and their 

potential customers, to answer this question. 

16. Last summer, NASA announced that it would be sending two CubeSats to Mars. 

The twin communications-relay satellites are to be built by NASA's Jet Propulsion 

Laboratory and will launch as secondary payloads to the InSight lander. This 

mission will be the first time that CubeSats have flown into deep space. The vast 

majority of CubeSats are placed into low Earth orbit. Does industry have any 

plans to move beyond this orbit, out into deep space? 

Many companies do hope to move beyond orbit to cislunar space and beyond. 

Companies such as Planetary Resources are preparing to use CubeSats or similar 

platforms for exploring asteroids for prospective mining operations. 

17. NASA has several programs dedicated to the development of small satellites 

including its CubeSat Launch Initiative and Venture Class Launch Program. Can 

you please describe what the commercial industry's experience has been 

working with NASA and other government agencies in developing small satellites 

and launch? What policy recommendations do you have that could better serve 

American interests and promote the continued development of small satellite and 

launch technology? 

Policies that promote the fullest possible commercial use of space requires NASA to 

leverage commercial products where available, and avoid competing with private sector 

goods and services, and avoid government-derived duplication with the private sector. 

18.1n May of last year, the chairman of the Surrey Satellite Technology Ltd., Martin 

Sweeting, warned that there might be too much "heady enthusiasm" when it 

comes to CubeSats. SpaceNews called his comments a warning about a 

CubeSat bubble. Are CubeSats a sustainable business model, or is this just a 

Silicon Valley fad? What kind of timeline are investors in CubeSats looking at? 
102 

I fully believe that CubeSats are a sustainable business model. They can offer immense 

capabilities, often at a fraction of the cost of what would be necessary to achieve the 

same mission with one large satellite. Just as Moore's Law decreased the size of · 

computers and made them more commonplace, the miniaturization of satellites is an 

exponential trend. CubeSats are here to stay. 

19. NASA's Launch Services Program is actively trying to develop the small satellite 

commercial launch industry as an alternative to rideshare opportunities. Small 

satellite launch vehicles, like the ones proposed by Firefly, Virgin Galactic, and 

Rocket Lab, seem to be well suited to launching venture class missions. When 

looking at the market, do small satellite launch service providers see NASA as 

their primary customer or anchor tenant? Can you describe the demographic 

interested in small satellite launch services? 

Many of the launch vehicle providers see NASA as just one of many potential 

customers. There are a number potential dedicated smalls satellite launch customers 

including industry, governments, and academia that are looking to launch satellites into 

space and companies like Virgin Galactic, Vulcan, and Firefly will be able to offer launch 

services to these start ups at affordable prices. 

20. Several people have called the development of CubeSats a revolution in satellite 

technology. According to the Satellite Industry .Association's "State of the Satellite 

Industry Report" 63 percent of all satellites launched in 2015 were CubeSats. 

This is an impressive number. And yet while most of the satellites launched were 

CubeSats, they only made up less than 1 percent of the total market value of all 

the spacecraft launched. Can you give us a sense of scale for how big this 

revolution really is? What kind of economic impact are investors foreseeing in 

small satellite manufacturing and launch? 

I will defer to the investment community to answer this question. 

21. Space Works' 2016 Nano and Microsatellite Market forecast predicts that as 

many as 3,000 nano and microsatellites will require a launch in the next six 

years. The report concludes that "the industry has a need for small launch 

vehicles." There are a number of such vehicles under development by U.S. 

companies. Even if new U.S. vehicles enter the market, will U.S. domestic launch 

vehicles alone will be able to meet forecasted demand? 

Yes. American industry is responding to market demand and innovating on new 

technologies, outpacing any other nation in the world. 
103 

22.1n March of last year, the International Telecommunication Union held a 

conference in Geneva to discuss challenges facing the development of small 

satellites including frequency management and radio communication 

standardization. Out of that conference came a document called the "Prague 

Declaration" that confirms the "importance of implementing national legal and 

regulatory frameworks in conformity with international laws, regulations, 

guidelines and procedures." What are the major radio communication policies 

impacting the small satellite industry? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

23. The Federal Communications Commission licenses spectrum in the form of radio 

communication for satellites under three different categories: amateur, 

experimental and professional or operational. According to Space News, the fee 

to license an experimental satellite is $430,000. The fee to license an amateur 

satellite is $60. It seems clear why most small satellite operators choose to 

purchase an amateur license. What kinds of frequency issues are influencing the 

industry right now? Can you talk about this discrepancy in licensing prices? Does 

this inhibit the growth of the small satellite industry? 

CSF is working with its member companies on this matter, and looks forward to 

remaining engaged with the Committee on this matter. 

24. What are the differences of the U.S. government's role in space launch twenty 

years ago and now? Are the drivers for space assets and products different 

and/or bigger now than they were twenty years ago? 

By consistently reaffirming 30 years of U.S. commercia/launch policy, improving 

regulatory stability, and promoting pro-growth policies, the United States Government's 

role will continue to be an enabling partner with U.S. industry. 

25. Many of the companies we see entering the small satellite market are startups in 

Silicon Valley. How would you characterize the small satellite workforce? Are 

these new space startups positively impacting the employment and training 

pipeline for STEM students and recent graduates? 

These new and existing markets are driving substantial private capital investment into 

the U.S. space sector. In 2015, the commercial space industry saw historic levels of 

private capital investment and market growth. According to a recent report by the Tauri 
104 

Group, "More than 50 venture capital firms invested in space deals in 2015, the most in 

any year during the 15-year study period (2000-2015)."2 These investments totaled 

$1.8 billion in venture capital, and nearly $2.7 billion in total investment and debt 

financing, according to this report. 3 This investment is significant and reflects continued 

confidence in the market, which, according to the Tauri Group, has committed more 

than $13.3 billion in investment (including debt financing) since 2000. 

Over the past 5 years, a growing number of U.S. commercial space companies have 

expanded the commercial space economy beyond the traditional spaceflight hubs that 

were established back in the Apollo-era. 

From Florida to Seattle, the expanding commercial space economy is creating modern 

manufacturing facilities, high-tech jobs, and professional and personal fulfillment to an 

ambitious generation of Millennials that are determined to make America's 2151 century 

better than the last. 

Space)(, and commercial space companies, most meaningful place to work for 

Millennials. Median workforce age is 294 

Commercial satellite company One Web, a satellite telecommunication company 

that will expand broadband access globally, is building a 21st century satellite 

manufacturing and testing facility on the Florida Space Coast. The facility will 

bring 250 high-tech jobs to the area. 5 

• Jeff Bezos's Blue Origin rocket company is a/so building a 2151 century rocket 

manufacturing and integration facility on Florida's Space Coast. The facility will 

bring 330 high tech jobs to the area. 6 

• Firefly Space Systems, building a dedicated small-satellite launch vehicle, is 

building a rocket manufacturing and test facility in Cedar Park, Texas. The facility 

will bring 200 high tech jobs to the area. 7 

SpaceX building private spaceport in McGregor, Texas, which employs 300 

people. 8 

2 Tauri Group. http://space.tatirigrilllp.fom/repof!~L~tart_l)p_Sr>a~(!.pdf 3 Tauri Group. !Jttp~ii2P!l£~,\<)!!!:i£t:21ci]J"9-Q!:!l£ri'!P~Jlts/~at1_jlp__~pace.pqJ 4 http://www.payscale.com/data-packages/top-tech-companiescompared?utm_source=buzzstream&utm_medium=outreach&utm_campaign=tech%20 

employers 16 5 http://www .orlandosentinel.com/business/os-florida-privatized-space-race-20160419-

story.html 

6 http://www. orlandosentinel.com/business/os-florida-privatized-space-race-20160419-

story.html 

7 http://www. fireflyspace .com/news/ournews/firefly-space-systems-awarded-usd 1-2-

million-economic-development-grant-from-cedar-park 

8 http://www.wacotrib.com/news/business/mcgregor-sets-new-limits-on-spacex-rocketnoise/article _17 4a 13fd-652b-5139-a4fa-2d328cc89f0e.html 
105 

World View Enterprises, a company that manufacturers helium-filled balloons 

and capsules that can carry passengers and scientific payloads to the edge of 

space, is building a modern manufacturing and launch facility in Tucson, Arizona. 

The facility will create 448 new high tech jobs over the next five years. 9 

Virgin Galactic has opened a new facility in Long Beach, California to design and 

manufacture the company's small satellite launch vehicle, LauncherOne. The 

facility will create 200 new high tech jobs in the area. 10 

• Spaceflight Industries, securing rideshares for secondary payloads and building a 

60 satellite remote sensing constellation, is doubling its Seattle-headquartered 

staff to keep up with its growing business. 11 

26. The number of small satellites and CubeSats launched in the past few years has 

skyrocketed. There is an entire industry developing just to serve the small 

satellite and CubeSat community -including manufacturing, launch, and valueadded data products. Can you give us a sense of how the small satellite industry 

is impacting job creation? 

Please see my answer to question number 25 for details on job creation and economic 

growth. 

27. Would the use of excess ICBM motors for commercial launches compete with 

sub-500kg class vehicles currently in development? 

Yes. Every orbital Minotaur launch, except for one, has launched a sub-500kg class 

satellite as its primary payload. 

a. How would payload aggregating affect an evaluation of whether excess 

ICBM motors would compete with sub-500kg class vehicles currently in 

development? 

Every orbital Minotaur launch, except for one (Minotaur IV launch Sept. 26, 2010), has 

launched a sub-500kg class satellite as its primary payload. It would be competing 

regardless of aggregation. 

b. Would launch vehicles that used excess ICBM motors compete with larger 

launch vehicles for market-share of aggregated payloads? 

9 http://tucson.com/news/city-council-approves-incentive-for-worldview/article 8a8b0bf6-dfaf-5319-94 73-f41 a28900506.html 10 http://www.space.com/28866-virgin-galactic-launcherone-rocket-factory.html 11 http :1/www .bizjou rnals .com/seattle/blog/techflash/2015/03/spaceflight-ind ustries-todouble-in-staff-revenue.html 
106 

c. If they would compete, with or without aggregation, is there a way to 

mitigate the impact to the commercial market? 

Don't allow them to compete. 

No. 

d. Would a sunset on the availability of excess of ICBM motors mitigate any 

concerns? 

e. How would the commercial market be affected (if at all) by only allowing 

excess ICBM motors to be used for commercial markets until sub 

Although we expect the market to grow, it is small enough at this point that even the 

addition of a relatively small number of ICBM motors would dilute the market and cause 

harm. 

f. Would a capon the number of motors available (either in total or to an 

individual recipient) mitigate concerns? 

To a degree this would mitigate some of the concerns depending on the exact number, 

but it would still not address the inherently anti-competitive behavior that would be 

introduced into the market that would threaten the space launch industrial base. I 

believe that the cap that should remain place is zero; zero ICBM motors available to 

anyone. 

28. How should the government determine the fair market value of an excess ICBM 

motor? 

In order to assess any potential methodologies for determining fair market value of 

excess ICBM rocket motors, it is important to review and analyze the current 

methodology by which the Air Force establishes value for its excess ICBM rockets 

motors. 

In the Air Force's most recent financial report, United States Air Force Agency Financial 

Report 2015, excess ICBM rocket motor assets ("uninstalled intercontinental ballistic 

missiles motors") are recognized and reported as Operating Materials and Supplies 

(OM&S). 12 The Air Force is required by Statement of Federal Financial Accounting 

12 htt,:r//www.saffm,hq.af,rnii/ShGired/media/cjocurn~nt/I\F[)~ 151J 1_9-0JZ,pclf [page 48] 
107 

Standards No. 3 (SFFAS 3), Accounting for Inventory and Related Property, to use the 

historical cost to value its Operating Materials and Supplies inventory. The SFFAS 3 

stipulates that historical cost shall include all appropriate purchase and production costs 

incurred to bring the item to their current condition and location. This is the most 

appropriate methodology option available for valuating excess ICBM rocket motor 

assets because there are additional costs required to maintain the assets in their 

current "flight worthy"13 condition in "environmentally controlled" locations. Or as 

officials of the Rocket System Launch Program (RSLP) put it more succinctly, "Our 

capability to store, age and monitor assets a/lows us to offer deactivated weapons 

grade motors and components as some of the most reliable launch vehicles currently 

available. "

14 

With that said, it appears that the Air Force employs a different valuation methodology 

that deviates from the FASAB standard. Per Air Force Instruction 21-103, Equipment 

Inventory, Status and Utilization Reporting, certified current on 7 June 2014, states, 

''The RSLP SPO is responsible for establishing the value of uninstalled RSLP owned 

rocket motors. This value is normally derived from the original weapon system CFO 

reporting data elements (full cost and useful life) however, in the absence of this 

information (for the older weapon systems), the cost may be derived from other means. 

For example, retired ICBM weapon system booster costs established by the ICBM 

SPO. "

15 Per this mandatory instruction, the Air Force only takes into account the original 

weapon system's full cost and useful cost when determining a rocket motor's value, 

which fails to adequately capture all of the asset's historical costs, including "current 

condition and location" costs. When deciding to use an ICBM-derived launch vehicle for 

government missions, the Air Force should update its excess ICBM rocket motor 

valuation methodology to meet the FASAB historical costs standard, to include the 

aggregated costs of annual storage, aging surveillance, and refurbishment costs for 

each rocket motor from the time that it is deactivated and stored to the time it is 

refurbished and launched. 

With regard to selling ICBM rocket motors for commercial space launches, the SFFAS 3 

would require rocket motor assets to be governed by "Inventory" standards rather than 

"Operating Materials & Supplies" standards. The SFFAS 3 requires the reporting of 

inventory in one of four categories: "(1) inventory held for sale, (2) inventory held in 

reserve for future use, (3) excess, obsolete, and unserviceable inventory, and (4) 

inventory held for repair. The standards require historical cost or latest acquisition cost 

13 Space and Missile Systems Center. Performance-Based Work Statement (PWS) For Orbital/Suborbital Program 3 

\OSP-3). 10 May 2012. 4 Emmer. Freyenhagen, Hockenberry, Geiger, "ICBM Derived Small Life Vehicles: Past, Present, and Future". [page 

2] 

http://digitalcommons.usu.edu/cgi/viewcontent.cgi?article=1597&context=smallsat 

15 The RSLP SPO is responsible for establishing the value of uninstalled RSLP owned rocket motors. [page 99] 
108 

valuation of inventory held for sale and inventory held in reserve for future sale. Federal 

law and policy for thirty years have allowed the use of these assets by the government 

for launch and as targets, and these assets have been successfully used in that 

fashion. 

Ultimately, any methodology for determining the fair market value of the ICBM motors 

made available for government and commercial launch purposes should adequately 

reflect the substantial taxpayer investment in these assets. Historical cost valuation 

methodology appears to be the most accurate option for capturing the total investment 

and maintenance cost of these assets. With that said, focusing on fair market value for 

individual rocket motors misses the larger point, implied by other questions in this RFI, 

which is these rocket motors are intended for sale to provide the vast majority of the 

hardware for a space launch vehicle. For example, question number 8 inquires about 

the appropriate quantity of rocket motors that should be sold per year, but always in 

sets of 3. Why always in sets of 3? Because as the title of this RFI indicates, the 

purpose of selling excess ICBM motors is not to rebuild heritage ICBMs or ballistic 

missile targeting vehicles, but rather to build and compete commercial space launch 

vehicles. By focusing only on a method to determine a fair market value for the rocket 

motors and ignoring the fair market value of the potential space launch vehicle, a 

scenario could be created where the rocket motors are sold at a fair market price but 

then are used by a buyer to build a space launch vehicle that cost significantly less than 

comparable launch vehicles composed of new commercial boosters, thereby giving the 

buyer an unfair advantage in the commercial space launch marketplace. For example, 

"In 1998, RSLP supported its first orbital mission by launching an R&D satellite using a 

Peacekeeper ICBM Stage 1 to replace the Castor 120 booster on a Taurus SL V. 

This strategy saved the satellite customer about $6M[i/lion]. "

16 This scenario could 

materialize because boosters represent the highest cost component for the launch 

vehicle hardware. Typically, boosters represent 90% of the cost of launch vehicle 

hardware. Surplus ICBM boosters, integrated into launch vehicles using modern 

avionics, offer a way to shave 30%-50% off the cost of comparable launch vehicles 

composed of new commercial boosters. "

17 

Furthermore, if the U.S. Air Force were authorized to sell excess rocket motor assets 

through U.S. General Service Administration, the scenario outlined in the above 

16 Major Sebek, Captain Knorreck, First Lieutenant Elson, Mr. Buckley, "Low-Cost, 

Reliable Spacelift for Small Satellites Using a Peacekeeper ICBM Derived Space 

Launch Vehicle and Multi Payload Adapters". [page 1] 

http://digitalcommons.usu .edu/cgi/viewcontent.cg i?article= 1756&context=smallsat 17 Ibid. 
109 

paragraph may require an antitrust review by the Department of Justice per Federal 

Management Regulations: 

"When the sale of personal property has an estimated fair market value of $3 

million or more or if the sale involves a patent, process, technique, or 

invention, you must notify the Attorney General of the Department of Justice 

(DOJ) and get DOJ's opinion as to whether the sale would give the buyer an 

unfair advantage in the marketplace and violate any antitrust laws. "

18 

Ultimately, any methodology should include preventive measures to avoid this scenario, 

such as launch vehicle pricing provisions used in commercial space launch agreements 

to ensure potential excess ICBM-derived launch vehicles are comparable to similarly 

capable U.S. commercial space launch vehicles (e.g., Minotaur IV&V comparable to 

Athena 2c). 

29. What is your estimate of the fair market value of an excess ICBM motor? What is 

this estimate based on? 

Please see my answer to question number 28. 

30. What should the U.S. do to prevent U.S. payloads from going overseas to launch 

on foreign launch vehicles? Should it do anything? 

American industry is responding to market demand and innovating on new 

technologies, outpacing any other nation in the world. We seek to preserve this national 

leadership in space by the Committee strongly opposing any change to the existing 

policy with respect to the commercial use of excess ICBM assets and retaining the 

current case-by-case waiver process. 

31. What impact would a limitation on access to foreign launch services have on 

small satellite operators? 

A healthy small satellite industry would continue to grow and thrive by maintaining the 

current limitations that we advocate for in our response to question number 30. 

32. How long have the following launch vehicles been in development? 

CSF defers to the individual companies working on the vehicles you reference. 

18 http://www .gsa .gov/portal/ext/public/site/FM R/file/Part1 02-_ 38. html/category/21858/ 
110 

33. When is the expected operational readiness for the following vehicles? Please 

indicate if the initial operational readiness date was delayed. 

CSF defers to the individual companies working on the vehicles you reference. 

34.When do you believe a domestic launch capability will be available for sub-500kg 

performance? 

Domestic launch capability is already available for sub-500kg performance. This year 

Orbital ATK's Minotaur-C (commercial variant of the Minotaur launch vehicle family) will 

aggregate and launch 6 Skysat small satellites, which weigh 120 kg each, to Sun 

Synchronous Orbit (SSO). Similarly, SpaceX's Falcon 9 will launch Spaceflight 

Industries SHERPA spacecraft and payload adapter, which will launch 87 small 

satellites that are up to 500kg to LEO. In addition, additional domestic launch options for 

sub-500kg satellites will be coming online soon, including services by Virgin Galactic, 

Firefly, Vulcan Aerospace, Masten Space Systems, and Rocket Lab. 

35. How long should the U.S. small satellite operator community wait for the 

development of a domestic launch capability for sub-500kg performance? 

lt doesn't have to wait. Please see my answer to question 34. 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY SUBCOMMITTEE 

ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and 

Challenges 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation 

Questions submitted by Rep. Barbara Comstock 

1. As you all are aware, it is not unusual for the federal government, including 

both DOD and NASA, to make surplus government property and assets available 

to commercial users in order to save taxpayers money and support U.S. 

businesses. I think there is a broad consensus that making use of surplus assets 

when done in a transparent and competitive manner, is in the national interest. 
111 

In recent years, both the Air Force and NASA have made a tremendous amount 

of federal launch property available to commercial users at Cape Canaveral and 

Kennedy Space Center, often at extremely discounted rates, in the name of 

removing the maintenance costs from the government books as well as 

encouraging greater use of the launch complexes. This has included multiple 

launch pads, processing facilities and other property which was built or acquired 

at significant taxpayer expense. 

When these federal assets were made available to launch companies, there was 

little debate about doing so -despite the fact that it directly competed with state 

spaceports, like MARS, Alaska, and others, who were developing similar 

capabilities with state and private investment and competing for the same 

customers that were given valuable federal property under very generous terms. 

Given that the government policy for this ground infrastructure has been to make 

surplus assets available to commercial customers at below market rates, why is 

there opposition to allowing a restricted number of decommissioned motors 

available to commercial providers at fair market value? Can you clarify how some 

commercial launch providers readily accepted surplus ground infrastructure but 

are now opposing a similar policy when it comes to excess motors? 

Yes, you're correct, the DoD and NASA have made surplus government property 

and assets/equipment available to a number of users, including allied Foreign 

governments, State and local governments, and U.S. commercial businesses, for 

a variety of reasons, which include, among others, leveraging taxpayer property, 

reducing Federal government agencies' Operation and Maintenance (O&M) 

costs, and supporting new U.S. businesses and job creation. However, as you're 

aware, there are significant differences between how the U.S. Government 

makes surplus government property and surplus government assets/equipment 

available for private sector use. 

For instance, U.S. commercia/launch companies and State spaceports primarily 

acquire excess launch property and infrastructure through lease agreements with 

U.S. Government (DoD and NASA), rather then purchase excess launch property 

and infrastructure through auctions via the Government Services Administration 

(GSA), per Federal Acquisition Regulations (FAR). Leasing U.S. government 

excess launch property and infrastructure is a significantly different acquisition 

process, with significantly different implications, than the sale of excess DoD and 
112 

NASA assets/equipment to be competed for commercial market-share against 

other U.S. private companies. In fact, Congress recognized this important 

difference over 20 years ago when it codified established policy into Jaw that 

limited the sale of excess defense assets/equipment if it were to have "an 

adverse impact on the national technology and industrial base and, 

particularly, will not reduce the opportunities of entities in the national 

technology and industrial base to sell new or used equipment. "

19 22 U.S. 

Code 2321j(b)(1)(E/0 

If these excess ICBM rocket motors were to be sold for competition in the 

commercial space launch market, they would both have "adverse impact on the 

national technology and industrial base and, particularly, .. . reduce the 

opportunities of entities in the national technology and industrial base to sell new" 

rockets in the commercial space launch market. 

In addition, if Congress were to decide to overturn 20 years of longstanding 

policy, it would be vel}' difficult to define fair market value of these excess ICBM 

rocket motors. Any methodology for determining the fair market value of the 

ICBM motors made available for government and commercia/launch purposes 

should adequately reflect the substantial taxpayer investment in these assets. 

Historical cost valuation methodology appears to be the most accurate option for 

capturing the total investment and maintenance cost of these assets. With that 

said, focusing on fair market value for individual rocket motors misses the larger 

point, implied by your question's reference to a "restricted number of 

decommissioned motors available to commercial providers", which is the purpose 

of selling excess ICBM motors is not to rebuild heritage ICBMs or ballistic missile 

targeting vehicles, but rather to build and compete commercial space launch 

vehicles. By focusing only on a method to determine a fair market value for the 

rocket motors and ignoring the fair market value of the potential space launch 

vehicle, a scenario could be created where the rocket motors are sold at a fair 

market price but then are used by a buyer to build a space launch vehicle that 

cost significantly less than comparable launch vehicles composed of new 

commercial boosters, thereby giving the buyer an unfair advantage in the 

commercial space launch marketplace. For example, "In 1998, RSLP supported 

its first orbital mission by launching an R&D satellite using a Peacekeeper ICBM 

19 https://www .gpo.gov/fdsys/pkg/PLAW-1 04publ164/htmi/PLAW-1 04publ164.htm 20 https://www.law.cornell.edu/uscode/text/22/2321j 
113 

Stage 1 to replace the Castor 120 booster on a Taurus SL V. This strategy saved 

the satellite customer about $6M[illion]. "

21 This scenario could materialize 

because boosters represent the highest cost component for the launch vehicle 

hardware. Typically, boosters represent 90% of the cost of launch vehicle 

hardware. Surplus ICBM boosters, integrated into launch vehicles using modern 

avionics, offer a way to shave 30%-50% off the cost of comparable launch 

vehicles composed of new commercial boosters. "

22 

Furthermore, if the U.S. Air Force were authorized to sell excess rocket motor 

assets through U.S. General Service Administration, the scenario outlined in the 

above paragraph may require an antitrust review by the Department of Justice 

per Federal Management Regulations: 

"When the sale of personal property has an estimated fair market 

value of $3 million or more or if the sale involves a patent, process, 

technique, or invention, you must notify the Attorney General of the 

Department of Justice (DOJ) and get DOJ's opinion as to whether 

the sale would give the buyer an unfair advantage in the 

marketplace and violate any antitrust laws. "

23 

Ultimately, any methodology should include preventive measures to avoid this 

scenario, such as launch vehicle pricing provisions used in commercial space 

launch agreements to ensure potential excess ICBM-derived launch vehicles are 

comparable to similarly capable U.S. commercial space launch vehicles (e.g., 

Minotaur IV&V comparable to Athena 2c). 

2. As the committee reviews this issue, Members have a fiduciary responsibility 

to act in the best interest of taxpayers as well as to determine what is in the best 

interest of our national security. 

21 Major Sebek, Captain Knorreck, First Lieutenant Elson, Mr. Buckley, "Low-Cost, 

Reliable Spacelift for Small Satellites Using a Peacekeeper ICBM Derived Space 

Launch Vehicle and Multi Payload Adapters". [page 1] 

http://digitalcommons.usu.edu/cgi/viewcontent.cgi?article=1756&context=smallsat 

22 Ibid. 23 http :1/www .gsa.gov/po rtal/ext/public/site/FM R/file/Part1 02-_ 38. html/category/21858/ 
114 

From both of these perspectives, it appears that it is in the Air Force's interest to 

reduce its stockpile of decommissioned motors in a responsible manner by 

reducing annual maintenance costs and avoiding the costly process of 

responsibly destroying these engines. 

The taxpayers would also benefit from having more immediate, low-cost launch 

options from a variety of spaceports, which already have the launch pad and 

ground infrastructure in place to launch these vehicles to launch NASA and 

NOAA payloads on a commercial contract. 

Would you agree that using these decommissioned motors in such a manner is 

ultimately in the best interest of both the taxpayer, the Defense Department and 

customers who need immediate affordable launch options? 

No, I respectfully disagree with your assessment. First, from 1972 to 2006, the 

Air Force reduced its stockpile of decommissioned motors in a responsible 

manner by over 650 rocket and missile launches using these surplus motors. 24 

RSLP used these rocket motor assets over the last thirty years to support DoD 

research and testing, chiefly as target vehicles for interceptor and sensor 

testing. 25 Even with this significant reduction in its stockpile, the Air Force's 

oversight and maintenance costs for these motors has remained constant as this 

a fixed costs. 

It is not in the interest of the taxpayer to use old assets to compete against new 

businesses creating high-tech jobs. Rather, these assets are best utilized by 

continuing to lower cost for activities like ballistic missile targeting. To that end, 

the Army's and Missile Defense Agency's use of excess ICBM motors has 

lowered the cost of developing new ballistic missile targeting vehicles. In April 

2016, Lt. Gen. David Mann, USA, Commanding General of the U.S. Army Space 

and Missile Defense Command testified to the Senate Armed Services 

Committee about how the Army was taking advantage of excess ICBM motors to 

develop low-cost targeting vehicles: 

24 Emmer, Freyenhagen, Hockenberry, Geiger, "ICBM Derived Small Life Vehicles: Pas!, Present and Future". [page 

2] 

http://digitalcommons.usu.edu/cgi/viewcontent.cgi?article=1597&context=smallsat 

25 Major Buckley, Captain Weis, Lieutenant Marina, Jr., Lieutenant Morris, Schoneman, "The Orbital/Suborbital 

Program (OSP) "Minotaur" Space Launch Vehicle: Using Surplus ICBM Motors To Achieve Low Cost Space Lift For 

Small Satellites". [page 1] 

http://digitalcommons.usu.edu/cgi/viewcontent.cgi?article=2216&context=smallsat 
115 

"Low-Cost Target Development: The Army continues to pursue a 

technology effort to develop a suite of low-cost targets for the 

Patriot testing program. The intent is to design threat-representative 

targets at a substantially reduced cost for short-range ballistic 

missile testing. Over the past year, we completed detailed designs 

for three new short range ballistic missile targets leveraging existing 

excess solid rocket motors. The first risk reduction flight of these 

targets is planned for May 2016. The Army will realize significant 

savings conducting operational test events using these new targets 

beginning in Fiscal Year 2017. We will continue to leverage existing 

missile inventory and technology advancements to develop less 

expensive targets that are representative of real world threats. "

26 

As for the best interest of our national security, I also respectfully disagree that it 

is in our best interest to use these old assets for commercial space launches. 

Excess Intercontinental Ballistic Missiles (ICBM) assets are already available to 

government users today. Expanding the transfer of ballistic missile rocket motor 

assets to include commercia/launch providers would result in little change, if any 

at all, to space access for national security users. Under the current policy and 

law that has been in place for the last three decades, the U.S. Government 

agencies can use launch vehicles derived from excess ICBM rocket motors as 

long as there is no cost-effective commercial alternative, which is determined on 

a case by case basis. 

In addition, the United States' current national security dependence on Russian' 

rocket engines is due, in part, to its decision to focus on solid-fuel boosters: 

"The Soviet arsenal was built exclusively on liquid engines, whereas 

the military in the West eventually abandoned liquid engines for 

solid-fuel booster rockets, which were deemed easier to launch 

quickly. Over all, the Russian fleet of liquid fuel rockets was far 

more diverse than the West's ... Most importantly, Moscow kept 

working at it, hard. Apart from the space shuttle main engine, the 

United States developed no new power plants for liquid rockets 

after the 1960's. "

27 

26 D1tQ://wiJ'1'f:!_,<!f:ffied-~e_rvices~enate_&g'll'[imo/m~Q_ia/doc/Manl]__ 04-i~.::..t§,Qdf [page 9] 27 Broad, William. NY Times. "Russian Rockets Get Lift in U.S. From Cautious and 

Clever Design". 29 October 1996. 

http :1/www. nytimes. com/1996/1 0/29/science/russian-rockets-get-lift-in-us-from-cautiousand-clever-design.html?pagewanted=all 
116 

This situation was further exacerbated by the U.S. Government's decision to 

compete the U.S. Government's space shuttle against potential U.S. commercial 

space launch services. As noted by the Congressional Research Service, it was 

not until after the U.S. Government decided to end its practice of competing 

government launch assets against U.S. private industry that a U.S. commercial 

launch services industry was able to emerge: "But removing the shuttle as a 

competitor is seen as the major factor in fostering the U.S. commercial space 

launch business. "

28 

These two decisions - a significant focus on solid-fueled rocket motors and 

government assets competing with U.S. private companies- that helped lead to 

a 1990s "wave of activity..characterized by the export of Russian ides, engines 

and vehicles to Western states. "

29 

Now, after putting into place policies to obviate that from reoccurring, many 

commercial companies are developing, under the regulatory auspices of more 

than two decades of consistent Government policy, innovative new launch 

vehicles that can meet national security, civil space, and commercial needs. Any 

policy shift now allowing for commercial access to excess ICBM assets would 

have a negative impact on national security and would encourage the entry of 

artificially cheap launch vehicles, based on old, inefficient, and finite 

technologies. This in tum, would discourage further investment in small satellite 

launch, and pick winners and losers in the marketplace, with one or two 

companies receiving an unfair advantage and the rest being forced to compete 

unfairly. 

3. It is my understanding that the US Government maintains an inventory of 

hundreds of decommissioned ICBM motors at a cost of millions of dollars 

annually to the taxpayer. There has been a lot of discussion lately on whether or 

not these motors should be used commercially and what that impact would look 

28 Space Launch Vehicles: Government Activities, Commercial Competition, and Satellite 

Exports. Congressional Research Service Issue Brief for Congress. Marcia S. Smith. April 29, 

2005. Page CRS-2. Link: http:/!www.hq.nasa.gov/office/hqlibrary/documents/o60694623.pdf 29 Broad, William. NY Times. "Russian Rockets Get Lift in U.S. From Cautious and 

Clever Design". 29 October 1996. 

http://www. nytimes. com/1996/1 0/29/scie nee/russian-rockets-get -lift -in-us-from-cautiousand-clever-design.html?pagewanted=all 
117 

like for the industrial base. If Congress does modify existing law to allow for 

commercial use of these assets, but set limits on the number of flight vehicles 

sold to no more than 5 per company annually and then conduct a review in 3 

years to examine if changing the policy has negatively impacted the broader 

industrfal base, do you believe that could help alleviate concerns on this issue? 

Although we expect the market to grow, it is small enough at this point that even 

the addition of a relatively small number of ICBM motors would dilute the market 

and cause harm. More important, however, is the signal that the Government 

would be sending by reversing its longstanding policy and involving itself in this 

strategic market. Such an action would indicate to investors that the Government 

could increase its involvement at any time, and could expand its involvement to 

other commercial spaceflight activities. This creates uncertainty, which harms 

investment. 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY 

SUBCOMMITTEE ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and 

Challenges 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation 

Questions submitted by Rep. Jim Bridenstine 

1. Given that the ISS will not be around forever, do you see commercial habitats as the 

next generation of LEO platforms? 

I do believe that commercial habitats will be the next generation of LEO platforms. 

Commercial companies are already heavily involved in the operations of the ISS. 

NanoRacks has now launched over 100 satellites from the ISS and Made in Space's 30 

printer allows astronauts to print new tools right on aboard the station. If commercial 

companies take the initiative LEO operations, then NASA could focus on its deep space 

missions. 

In a recent success for the industry, Bigelow Aerospace successfully expanded their 

BEAM module on the ISS, demonstrating the readiness of the technology to lead the 

way when the ISS is decommissioned. 
118 

HOUSE COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY SUBCOMMITTEE 

ON SPACE 

The Commercial Space Launch Industry: Small Satellite Opportunities and Challenges 

Mr. Eric Stallmer, President, Commercial Spaceflight Federation 

Questions submitted by Rep. Mo Brooks 

1. Mr. Stallmer, you said that Arianespace will be supporting One Web's launch of 

hundreds of smallsats with the Soyuz launch vehicle it. The Russian Federal Space 

Agency is the prime contractor for Arianespace for Soyuz launches. How much money 

will Russia receive from supplying Arianespace and OneWeb? 

CSF defers to Arianespace for an accurate answer. With that said, Virgin Galatic is 

launching 39 of One Web's launches, which is 18 more launches than Ariancespace is 

contracted for. In addition, One Web has a contract clause with Virgin Galatic which 

allows it to contract for up to an additiona/100 launches with Virgin Galactic. Clearly 

U.S. launch providers are meeting the global commercia/launch market's needs. 

1. Mr. Stallmer, the US government has had a close contractual relationship with the 

contractor of these missile assets. Additionally, next-generation launch companies are 

developing systems that cannot use these motors. Would that contractor have a 

competitive advantage in this case? 

Yes, absolutely. This close contractual relationship includes: 

• The Air Force spent millions of dollars helping the contractor of these 

missile assets develop a number of orbital launch vehicles using these 

exact rocket motors that are being discussed for commercial space launch 

use. 

• Then, over the past 20 years the Air Force has spent hundreds of millions 

of dollars procuring orbital launches from the contractor of these missile 

assets, using the launch vehicles that incorporate these rocket motors as 

described above, through the Orbital/Suborbital Program-1 (OSP-1) 

contract, Orbital/Suborbital Program-2 (OSP-2) contract, Suborbital Rocket 

Program-1 (SRP-1) contract, Suborbital Rocket Program-2 (SRP-2) 

contract, and Suborbital Rocket Program-3 (SRP-3) contract. 

• In addition, the Air Force has spent additional hundreds of millions of 

dollars contracting with the contractor of these missile assets to do 
119 

storage, aging and surveillance, and refurbishment activities to these 

motors. 

2. Mr. Stallmer, would you be willing to work and find a compromise to ensure that US 

launch providers could use decommissioned ICBM motors while at the same time 

address the concerns of your organization? If so, what would need to be addressed in 

the compromise? 

Absolutely. The Commercial Spaceflight Federation is, and has been, more than 

willing to work with others to find a compromise if the outcome likely would result 

in improving the health and competitiveness of the United States commercial 

space industry, and as a result, strengthen the nation's assured access to space. 

However, we are opposed the notion that a highly successful, long-standing 

policy should be arbitrarily overturned for the sake of compromise, regardless of 

the collateral damage that would likely ensue. 

(121) 

Appendix II 

ADDITIONAL MATERIAL FOR THE RECORD
122 

STATEMENT SUBMITTED BY THE FULL COMMITTEE

RANKING MEMBER EDDIE BERNICE JOHNSON
123 

Æ 

address them is something that I hope this morning's discussion can contribute. Because 

finding affordable, reliable, and responsive access to space for smallsats will be critical to 

realizing their potentiaL 

In addition. there are questions that I hope the Subcommittee will discuss at future hearings, 

such as the potential implications of a large number of smallsats on an already worrisome 

orbital debris problem and considerations were we to provide Universities with greater 

opportunities to be secondary payloads on launches conducted and paid for by the 

government. 

But for today, I hope this panel can shed additional light on possible solutions to providing 

small sat users and operators with more launch options, particularly those that are affordable. 

Because if this Nation is to maintain its global leadership in technology, we must facilitate 

the means by which our young are inspired to do great things. Small satellites, along with 

rocketry and robotics, provide the learning catalysts we so dearly seek and need. 

We must capitalize on the opportunities made possible by sm;;tllsats and find ways to launch 

them affordably. 

Thank you, Mr. Chairman, and I yield back.