These supports counter the tendency of the market to grossly underestimate the potential economic value of investments in novel transportation methods. The problems of space commercialization would be familiar to those early rail and air pioneers. Space activity is expensive. Capital costs of vehicles and support facilities are extremely high. Due to the nature of the business, it can take years to recoup an initial investment.
Novel technologies create unforeseen and often unique risks.
All of these costs and risks add up to a price for launch which assures that few customers can afford to pay. Costs can be dramatically reduced by designing vehicles and operations for a greater number of launches, thereby amortizing much of the cost, but absent a patent need, no firm has been willing to design and produce such a system. Launch systems can't be built without a market, yet the market cannot develop without an affordable launch system. Though a great deal of time money and effort has been spent on eliminating this Catch-22 by devising technical improvements to launch vehicles, far less has been invested in enhancing the market prospects for space goods and services despite the fact that a number of potential commercial markets, tourism in particular, hold out the possibility of overcoming the space market dilemma. The Act supports a wide variety of space activities by creating favorable incentives in the tax code.