Commercial Development Plan

for the

International Space Station

Commercial Development Plan 

for the 

International Space Station 

Final Draft 

16 November 1998 

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Objective 

Commercial Development Plan 

for the 

International Space Station 

• Long Term: To establish the foundation for a marketplace and stimulate a national economy for 

space products and services in low-Earth orbit, where both demand and supply are dominated by 

the private sector. 

• Short Term: To begin the transition to private investment and offset a share of the public cost for 

operating the space shuttle fleet and space station through commercial enterprise in open markets. 

Strategy 

• In partnership with the private sector, initiate a set of pathfinder business opportunities which can 

achieve profitable operations over the long run without public subsidies. Employ these businesses 

to break down market barriers in the near term and open the path for economic expansion. 

• Initialize the process through the internal NASA study of pathfinder candidates, as a point-ofdeparture, with emphasis on pushing the envelope in terms of both public and private sector 

policies, procedures and cultural predispositions [study results provided in attachment 1]. 

Tactics 

1. Release Baseline Pathfinder Study with NASA Assessment of Goods and Services with 

Commercial Potential. 

• Identify nine pilot business areas for private sector validation [completed]. 

• Initiate business development in partnership with industry. 

2. Commission an Independent Market Assessment to Initiate the Most Effective Pathfinders 

(Horizon: 6 Months) 

• Task a nationally prominent business school with recognized high technology acumen, 

through a new cooperative agreement, to evaluate the prospect of the space station becoming a 

fee-for-service commercial technology development testbed. 

• Task SpaceVest, through existing cooperative agreement, to evaluate the private investment 

potential in emerging markets for space products and services which could be enabled through 

access to space shuttle, shuttle replacements and space station accommodations. 

• Task the United Space Alliance, through existing contract, to evaluate the prospect of space 

shuttles and space station as platforms for commercially provided products and services. 

• Task the Boeing Aerospace Corporation, through existing contract, to evaluate the prospect of 

the space station as a customer for commercially provided growth elements, distributed 

systems, and utility services. 

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• Task the Commercial Space Centers, through existing cooperative agreements, to query their 

existing 135 industrial affiliates and evaluate the prospect of the space station becoming a feefor-service product development laboratory or production center. 

• Task the KPMG Peat Marwick Space and High Technology Practice, through existing 

contract, to convene a panel composed of representatives from each of the previously 

identified areas, and others as needed, to review the range of market assessments and to 

synthesize a report on: (a) the market potential; (b) perceived barriers to market entry, and; 

(c) the most effective pathfinder enterprises. 

3. Characterize Barriers to Market Entry and Identify Corrective Actions 

(Horizon: 6 Months) 

Access to Space 

• Direct a cross-program team to audit current practices for assigning space shuttle middeck 

accommodations and establish a minimum set-aside for flight opportunities on every mission 

[underway]. 

• Appoint a dedicated Senior Assistant for Access to Space, charged to continuously scan for, 

and secure, alternative flight opportunities on both reusable and expendable launch vehicles 

[underway]. 

• Benchmark the NASA cost to sortie one dedicated space shuttle mission per year, Commerce 

Lab, until the space station achieves full payload readiness. Identify as an augmentation in the 

FY 2001 NASA submit to the Office of Management and Budget. 

Administrative Process 

• Establish a clearing house function at NASA headquarters for the logging and dispositioning 

of commercial proposals. Implement through an agency-wide Organizational Work Instruction 

in compliance with ISO-9001 [draft provided in attachment 2]. 

Policy 

• Acquire an experienced professional economist to update the 1985 Congressional Budget 

Office report on “Pricing Options for the Space Shuttles” and the 1994 National Academy of 

Public Administration report on “A Review of Space Shuttle Costs, Reductions Goals and 

Procedures”. Benchmark historic marginal and average costs of space shuttle flights, and 

project costs for space station accommodations. 

• Task the KPMG Peat Marwick Space and High Technology Practice to evaluate the effects of 

transitioning from a cost-based to value-based pricing policy with provisions for government 

cost offsets, and define objective methods for establishing value. 

• Task the NASA Office of Policy and Plans and Office of Public Affairs to: (1) acquire the 

services of a recognized firm in the practice of name brand management to evaluate the value 

of space program associations in advertising and customer relations, and; (2) initiate a review 

of NASA practices related to commercial enterprises involving public service sponsorships, 

expressed or implied endorsements, or other situations which affect public perception of the 

nation’s space program. 

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______________________________ ______________________________ 

• Implement the pathfinder strategy as a forcing function to advance policies which will enable 

the commercial development of space shuttle and space station. 

Intellectual Property 

• Task the NASA Office of General Counsel to complete a reference guide discussing the 

statutory, regulatory and programmatic strictures on the deployment, utilization and ownership 

of intellectual property within the space station program. 

• Building on General Accounting Office audit #707379 of technology control plans for the 

space station, task the NASA Office of General Counsel to review agency policy related to the 

handling and treatment of proprietary data. If necessary, issue a NASA Policy Directive to 

correct any deficiencies. 

4. Establish a Non-Government Organization for Space Station Utilization Development and 

Management (Horizon: 1+ Year) 

• Develop a reference model to communicate vision, goals, purposes and working principles for 

a non-government organization (NGO) to manage US utilization of the space station and to 

reduce cost/schedule impediments at the user-operator interface [provided in attachment 3]. 

• Conduct a comprehensive vetting of stakeholders in the government, academic and industrial 

sectors, with the objective of elucidating advantages and disadvantages associated with forprofit, non-profit, and hybrid consortium approaches implemented under contractual or 

cooperative agreements. 

• Develop an organizational and telecommunications architecture that will be most effective for 

evolution to an international scope of operations consistent with the national objectives and 

existing infrastructure of all partners in the space station program. 

• Issue a Request for Proposals and select a NGO in parallel with deployment of the US 

Laboratory in calendar year 2000. 

This plan we have set forth, in concert with the 1998 Commercial Space Act, represents an unprecedented 

initiative to stimulate business growth in the space sector. With the ongoing support of Congress and the 

Executive Branch, we look forward with great excitement to the opening of the 21st century and the role of 

NASA in continuing to push the frontiers of science, technology and economic development. 

Joseph H. Rothenberg Arnauld E. Nicogossian 

Associate Administrator, Space Flight Associate Administrator, Life and 

 Microgravity Sciences and Applications 

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Restructuring the Space Economy

Short Run Long Run 

Future Future Government 

Private Proposals Requirements 

Establishing the Customer - Supplier Relationship

Restructuring the Space Economy 

Internal Proposal 

Clearing House 

(ISO 9000) Non-Government 

Organization* 

Customer 

Supplier 

Private 

Pathfinder (e.g., COMSAT, STSI)

Enterprises 

Independent External Privatized NASA Internal Market Study Space Transportation, Pathfinder Study “Commerce Lab” (Commercial Space Act) Space Station Reimbursable Missions Operator 

(SFOC Evolution) 

Pricing 

Policy Independent External 

Pricing Analysis * A Non-Government Organization could be for-profit, 

(Shuttle & Station) non-profit, or a hybrid consortium, as determined in the 

course of evaluating pros and cons during the 

stakeholder vetting period. 

Establishing the Customer - Supplier Relationship 

Users 

Government 

Uses 

Known 

Commercial 

Uses 

Untapped 

Commercial 

Opportunities 

NGO for Space Station 

Utilization Development & Management 

(for-profit, non-profit, or hybrid consortium) 

Customer 

Supplier 

Operators 

New Capability Developers 

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