Some More Thoughts About Lunar Markets

As several commenters and blogospheric critics have mentioned, the odds of actually getting NASA to change its course from the current ESAS moondoggle to something more sustainable, affordable, and which helped catalyze commercial lunar transportation are well…rather small. Even with such low odds of success, the sheer size of the potential payoff if we could convince NASA to change its mind made putting at least some time and effort into pursuing that avenue worthwhile. However, while I still intend to continue tilting at that windmill from time-to-time, I am much more interested in finding commercial approaches to openning up cis-lunar space for commerce and eventually settlement.

As Thoreau once said, it’s ok to have castles in the air, so long as you build foundations up from the ground to reach them. I think that the goal of economically thriving off-world settlements is a realistic one, but one that requires a lot of foundation work to make it possible. Before you can have off-world settlements, you have to have an economically valid reason for having them there. In other words, you need to develop space markets, and not just any space markets, but more importantly space markets that actually benefit from having people there.

I’m not going to try and write a treatise on all the potential space markets here, but I did want to give a couple thoughts about a few of the more promising ideas out there.

In addition to interest in suborbital and orbital tourism, there have also been some groups looking even farther ahead to lunar tourism. Groups like both CSI and Space Adventures have been trying to market translunar spaceflights, and others have suggested eventually marketting lunar landing expeditions.

Private lunar expeditions have some real things going for it compared to many other lunar markets. The biggest one being that private lunar expeditions require a whole lot less technical development and research to get to market than many other lunar markets. Almost all of the technical development required before you can do a private lunar expedition is the transportation hardware to get there. Compare this to the amount of research and development needed to make a lunar mining project work, and you can see the appeal.

We don’t know if there is really platinum in them thar craters, if there is platinum, if it can be profitably extracted and shipped back to earth. We don’t know if anyone will ever find a way to use Helium-3 in a reactor. We don’t know if we can make lunar ISRU work well enough to profitably sell propellants to other ventures. But we do know that if you can offer a low enough price, there are people who want to go to the moon. As Rick Tumlinson and others have pointed out, the “cargo” for space tourism already exists, and is “self-loading, inexpensive, and is produced by cheap manual labor.”

The big problem with current plans for lunar tourism is that the going price of $100M for a translunar flight isn’t attracting any interest, and probably never will. The amount of people who have could afford a $100M lunar vacation without breaking their bank is very limited indeed. If you can drop the price however, the pool of people with the required amount of wealth goes up rapidly.

I think that if you could get the price per seat for a translunar trip down to the $20-30M range, you might be able to get at least as many passengers as we currently see for ISS trips. But until you can get the prices down into at least that range, I doubt you’ll see much interest at all, and in order to see large numbers of flights, you really want to get it down in the $1-5M per seat range. Translunar flybys or lunar landing expeditions are a lot more exotic adventures than just going to ISS, but there’s only so much that people can afford for personal spaceflight.

The problem is that actually getting the costs down low enough to deliver that kind of a price is going to be a real challenge. I have some ideas for how to lower the costs that far, but they’re only partially baked, and will have to wait for a later post.

Foreign Astronaut Corps
Another idea floated by Bigelow for his Sundancer module was augmenting the demand for personal spaceflight by also trying to encourage other countries to form their own astronaut corps. There is at least a little precendence for this. South Korea for instance just signed a deal with Russia to fly their first astronaut sometime in 2008. Malaysia is also starting an astronaut corps. At a price point of around $10M, there are lots of countries that could afford a small astronaut corps that would otherwise have no real chance of doing much in space. So, there might be something to this idea after all.

There is a difference though between the personal spaceflight market and the foreign astronaut corps market. While some governments can get away with sending a few “representatives” on very expensive pleasure-trips, most will have to find a way of justifying the expenditure. My guess from past experience is that these spaceflight participants will be sold as being “research astronauts”. Basically, they will be doing at least some level of research, development or technology testing, not just enjoying the ride.

There might be an equivalent market for flying lunar scientists from other countries to the Moon. Heck, NASA has suggested as much at their big briefing a week or two ago on the Moon base idea. If there actually are any countries interested in flying astronauts to a future NASA lunar base, there might be some that would be interested in flying sooner, and at much lower costs. Some countries might want to follow Canada’s example, and instead of focusing on the transportation side of things, finding some important piece of technology that they can become the “go-to-guys” for. For instance, maybe Japan or Canada would be interested in buying a couple of early seats (and/or cargo space) on private lunar expeditions so that they could develop and debug robotic lunar rovers to sell to other countries or better yet, companies that want to do stuff on the moon. Maybe some country will decide to invest money early on into debugging ISRU LOX plants, which they could then build for other entities trying to do lunar exploration…I don’t know, but there may be some merit to this.

One problem with this is that so far, most governments have preferred a “no-money-crosses-borders” approach to funding international space projects. Ie each country chips in some part of the hardware, and in return gets some portion of the access. While this isn’t ideal, it’s also not completely unworkable. For instance, if Russia wanted to trade a Proton launch full of fuel in exchange for one of the seats on a mission, it might make some sense.

This is one of those topics that is new enough that it hasn’t been as thoroughly explored, and could probably use a lot more discussion. There are a lot of foreign governments, and they can afford to pay more than individuals can, so they might end up being an important part of early commercial lunar development. But the question is, how? How do you structure things and go about them in such a way to get the most commercial benefit out of international cooperation? I’m really not sure.

PGMs and Other Lunar Mining Operations
This one has also gotten a lot of recent attention. The problem is, is that lunar platinum mining, even if it can be eventually done profitably, probably doesn’t make much sense as an initial lunar business. The problem is that in addition to needing a way to get there, you also need to find out if there are any extractable concentrations, where they are, and then you have to develop and debug equipment to do so, and finally start running humanity’s first off-world mining operation. Large-scale industrial/mining operations in the lunar environment is something that is going to require a lot of iterations to get right, which implies low-cost and frequent access to the lunar surface. The whole idea that we can just design robotic mining hardware right now and get it right the first or second try is hubris.

So, lunar mining is likely going to be a follow-on market to personal lunar expeditions and flying foreign astronauts. With something as speculative as lunar PGM mining, not having to also develop the transportation hardware before you can even start on the actual mining stuff will make business cases a lot easier to close. Still not easy, but easier.

This is a market that only makes sense in combination with other lunar markets. The much lower transportation costs enabled by ISRU will make it easier to provide the price points needed to get high levels of lunar space tourism going, while also being a real neccessity for any sort of large-scale mining or industrial work on the moon. The nice thing about selling propellants is that your business isn’t intimately tied to any specific lunar market. Some of the best business people during the California Gold Rush were the ones selling food and tools to the guys trying to strike it rich. Selling propellants may end up being similar. Of all the speculative lunar markets there might be, even if 80% of them fail, it doesn’t matter as much to the guy selling them LOX, so long as somebody succeeds.

Concluding Thoughts
Anyhow, those were just a few of my thoughts. As I see it, the only two potential markets that really make sense in the near-term involve flying people–either wealthy individuals, or foreign astronauts. Both of those imply meeting price points in the ~$20-40M range for lunar transportation, with lower prices being even better. Both of those could also provide for a decent initial flight rate, and lower the bar for future more industrial/traditional lunar ventures.

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Jonathan Goff

Jonathan Goff

President/CEO at Altius Space Machines
Jonathan Goff is a space technologist, inventor, and serial space entrepreneur who created the Selenian Boondocks blog. Jon was a co-founder of Masten Space Systems, and is the founder and CEO of Altius Space Machines, a space robotics startup in Broomfield, CO. His family includes his wife, Tiffany, and five boys: Jarom (deceased), Jonathan, James, Peter, and Andrew. Jon has a BS in Manufacturing Engineering (1999) and an MS in Mechanical Engineering (2007) from Brigham Young University, and served an LDS proselytizing mission in Olongapo, Philippines from 2000-2002.
Jonathan Goff

About Jonathan Goff

Jonathan Goff is a space technologist, inventor, and serial space entrepreneur who created the Selenian Boondocks blog. Jon was a co-founder of Masten Space Systems, and is the founder and CEO of Altius Space Machines, a space robotics startup in Broomfield, CO. His family includes his wife, Tiffany, and five boys: Jarom (deceased), Jonathan, James, Peter, and Andrew. Jon has a BS in Manufacturing Engineering (1999) and an MS in Mechanical Engineering (2007) from Brigham Young University, and served an LDS proselytizing mission in Olongapo, Philippines from 2000-2002.
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52 Responses to Some More Thoughts About Lunar Markets

  1. murphydyne says:


    Instead of pleading to being a simple mechanical engineer, you should be thinking about International Space University. One of the things we covered was the Vienna Law of Treaties and how it affects the legality of treaties such as the 5 UN space treaties, which we all studied in depth.

    I guess I have to disclose that I am not a lawyer nor an attorney, nor counsel. I am just a simple investment banker whose next degree (in my 40s, 50s is the doctorate) will be a law degree. Probably something that ties together my BA in Int’l Business & Economics with my Master of Space Studies and 15+ years in commercial and investment banking.

    So my comments cannot be held to have legal authority or backing. I have discussed my particular view with space law folks like Berin Szoka, Wayne White and Virgiliu Pop. Some agree, others don’t. It’s all pretty ambiguous right now, and that means opportunity to set precedent. That’s the kind of opportunity I see.

    And all those greyfields just waiting to be put to good use.

  2. Pingback: Why the Moon? | Selenian Boondocks

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