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SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

reuters.com

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Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#91

Post by scrollaway »

hackuser wrote: post #60
krschultz wrote: post #21

Earlier quoted context omitted.

Now that you mention it, isn't it crazy that manufacturing a single F-35 costs more than an entire satellite launch including support services?

> isn't it crazy that manufacturing a single F-35 costs more than an entire satellite launch including support services? Not IMHO: The launch is a single, controlled, predictable task; they can choose their exact launch time and location for optimal performance; have extensive quality control checks and engineering, a room full of support engineers, etc; the exact route and timing of the launch is carefully planned a…

> The plane has to handle every contingency of war

And all of those problems are (supposedly) solved by the time the plane is being manufactured.

Your argument regards R&D costs, not manufacturing costs.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#92

Post by andyjohnson0 »

mdorazio wrote: post #3

This is exactly how the market is supposed to work - SpaceX is delivering the same service for a lower price and now ULA is finally forced to put serious effort into competing. I'm curious what they intend to do once the reusable first stage program gets going and launch costs drop even further.

I kind of agree. But I wonder whether an effective market can really exist for such a specialised service, with so few customers and even fewer suppliers (SpaceX, ULA, Arianespace ...)?

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#93

Post by pricechild »

hackuser wrote: post #60
krschultz wrote: post #21

Earlier quoted context omitted.

Now that you mention it, isn't it crazy that manufacturing a single F-35 costs more than an entire satellite launch including support services?

> isn't it crazy that manufacturing a single F-35 costs more than an entire satellite launch including support services? Not IMHO: The launch is a single, controlled, predictable task; they can choose their exact launch time and location for optimal performance; have extensive quality control checks and engineering, a room full of support engineers, etc; the exact route and timing of the launch is carefully planned a…

> dodge enemies trying to kill it

I thought dogfighting was nolonger required in this day and age?

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#94

Post by morgante »

TeMPOraL wrote: post #84
nitrogen wrote: post #76

Earlier quoted context omitted.

I don't really buy it. Decades of monopoly profits are a powerful incentive to stagnate. Those profits definitely fund a lot of survival, and potentially some interesting side projects, but I wouldn't call most of it innovation or progress. As for ambitious research projects, some people just do those on their own, and for the rest, there's academia, government grants, and venture capital.

> As for ambitious research projects, (...) there's academia, government grants (...) I.e. both of which provided by a de-facto ultimate monopoly which can afford "luxuries" like basic research because they don't have to worry it won't pay off next quarter. > (...) and venture capital. I want to see VC-sponsored ambitious research projects. VC-money-induced thinking is very short term.

> I want to see VC-sponsored ambitious research projects.

Isn't that exactly what YC research is?

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#95

Post by jernfrost »

nitrogen wrote: post #76
patrickk wrote: post #75

Earlier quoted context omitted.

An interesting counterargument from Peter Thiel: " Monopolies drive progress because the promise of years or even decades of monopoly profits provides a powerful incentive to innovate. Then monopolies can keep innovating because profits enable them to make the long-term plans and finance the ambitious research projects that firms locked in competition can't dream of. " http://www.wsj.com/articles/peter-thiel-competit…

I don't really buy it. Decades of monopoly profits are a powerful incentive to stagnate. Those profits definitely fund a lot of survival, and potentially some interesting side projects, but I wouldn't call most of it innovation or progress. As for ambitious research projects, some people just do those on their own, and for the rest, there's academia, government grants, and venture capital.

There is something to it. E.g. the government telecoms monopoly in Norway in the 1980s spent way more on research than the present day commercialized Telenor. However they were not necessarily innovative in products, but they did develop a lot of the original cell phone technologies which got later widely used.

I am not necessarily a fan of monopolies, but I think we owe it to ourselves to understand the tradeoffs and consider alternatives. E.g. how do you do basic research if there is so aggressive competition and shareholder look only 3 months ahead.

It is also worth nothing that the case of ULA isn't necessarily a case of merely monopoly but also how how that monopoly works. E.g. being a monopoly shouldn't require a cost plus contract. Secondly GM and the other big three are certainly not monopolies but have not proven any more capable than ULA in competing with Tesla in creating an electric car.

SpaceX is beating lots of other rocket companies which aren't necessarily monopolies. I think it is easy to overstate how bad ULA is when perhaps it is really about how good SpaceX is ;-)

Also remember the Russians also operated government monopolies for rocket building and yet managed to build considerably cheaper rockets than the Americans. I think there is a lot more to this issue than whether it is prive/public or a monopoly.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#96

Post by morgante »

patrickk wrote: post #75
tn13 wrote: post #22

Earlier quoted context omitted.

Problem with monopolies is that they lag behind on innovation.

An interesting counterargument from Peter Thiel: " Monopolies drive progress because the promise of years or even decades of monopoly profits provides a powerful incentive to innovate. Then monopolies can keep innovating because profits enable them to make the long-term plans and finance the ambitious research projects that firms locked in competition can't dream of. " http://www.wsj.com/articles/peter-thiel-competit…

I think it comes down to leadership.

Put simply, monopolies do have greater capacity to innovate. When you're stuck in brutal competition, it's hard to funnel money into research which might not pay off for decades—your competition might have driven you out of business by that point.

On the other hand, the allure of monopoly profits is hard to ignore. It's tempting to simply funnel the profits into shareholder pockets and that's the approach investors will generally favor. For any middling CEO, it's the path of least resistance.

This is why founder-controlled monopolies (Google, Facebook, Amazon, etc.) are such a potent force. They have the incentive to preserve the companies long-term legacy (it's their personal legacy as well) through ambitions projects while also having the credibility and power to resist investor preferences for short-term profits.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#97

Post by richmarr »

andyjohnson0 wrote: post #92
mdorazio wrote: post #3

This is exactly how the market is supposed to work - SpaceX is delivering the same service for a lower price and now ULA is finally forced to put serious effort into competing. I'm curious what they intend to do once the reusable first stage program gets going and launch costs drop even further.

I kind of agree. But I wonder whether an effective market can really exist for such a specialised service, with so few customers and even fewer suppliers (SpaceX, ULA, Arianespace ...)?

You could argue over the definition of 'effective' in this case but I don't think it'd be a matter of whether the market was big enough. Plenty of companies and countries want payloads delivered and there is choice of suppliers (again we could argue about how much choice is 'true' choice).

My guess is the market friction is political. ISRO (the Indian space agency) has been cheaper than ULA for years, but my suspicion is that the USA wouldn't consider using them for political reasons.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#98

Post by TeMPOraL »

morgante wrote: post #94
TeMPOraL wrote: post #84

Earlier quoted context omitted.

> As for ambitious research projects, (...) there's academia, government grants (...) I.e. both of which provided by a de-facto ultimate monopoly which can afford "luxuries" like basic research because they don't have to worry it won't pay off next quarter. > (...) and venture capital. I want to see VC-sponsored ambitious research projects. VC-money-induced thinking is very short term.

> I want to see VC-sponsored ambitious research projects. Isn't that exactly what YC research is?

Yes. It's also, like, just created. I'm observing it with keen interest.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#99

Post by Mvandenbergh »

grey-area wrote: post #66
kolinko wrote: post #61

Earlier quoted context omitted.

How?

They're planning throwing away most of the first stage and catching the expensive engines on parachutes in mid air with a helicopter above the ocean then landing them on a barge softly enough not to damage them. They haven't actually done this or even built the engines to do it. They have represented this purely hypothetical approach as more efficient than reusing the entire first stage, because you sacrifice less pa…

Not to mention the complexity inherent in getting the engines separated from the rest of the vehicle.

Also, they're at totally different places along the technological readiness curve. They're proposing a theoretical concept, SpaceX has already recovered two first stages. Even if their parachute concept was theoretically superior (which I don't think it is) by the time they got it working, SpaceX would have years of operational experience with hoverslam.

Re: SpaceX undercut ULA rocket launch pricing by 40 percent: U.S. Air Force

#100

Post by Mvandenbergh »

patrickk wrote: post #75
tn13 wrote: post #22

Earlier quoted context omitted.

Problem with monopolies is that they lag behind on innovation.

An interesting counterargument from Peter Thiel: " Monopolies drive progress because the promise of years or even decades of monopoly profits provides a powerful incentive to innovate. Then monopolies can keep innovating because profits enable them to make the long-term plans and finance the ambitious research projects that firms locked in competition can't dream of. " http://www.wsj.com/articles/peter-thiel-competit…

The argument is that the desire to establish a monopoly stimulates innovation, not necessarily that monopolists are innovative once established.

There's also a big difference between natural monopolies (like electricity or gas distribution networks) and IP monopolies. Monopolies that are established by providing a vastly superior product require continuous R&D investment to maintain and natural monopolies do not.

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