Virgin Galactic Backs Internet Satellite Venture

LauncherOne Image Credit Virgin Galactic

An interesting story is unfolding regarding what appears to be two separate efforts at establishing very large constellations of small, broadband satellites.

In an interview with Bloomberg which came out Tuesday, Elon Musk provided a few more details about the office SpaceX is opening in Seattle. Musk stated that office would initially include about 50-60 people and could eventually grow to 1000 as SpaceX tries to do for satellite manufacturing what it is in the process of doing for the launch industry. Musk stated that more details would be coming out during a “soft opening” on Friday, January 16.

When news reports first broke about the SpaceX venture into satellite manufacturing several months ago, multiple outlets tied the effort to industry veteran Greg Wyler, who founded O3B, and had more recently been spearheading a satellite Internet project at Google.

That seems to have been in error.  Earlier today, Richard Branson said during an interview on CNBC, that Virgin Galactic was entering the satellite business as well, providing financial backing and launch services for a 648 strong constellation of broadband satellites in partnership with Qualcomm and Wyler through a new company named OneWeb Ltd, taking over spectrum allocation from Wyler’s previous company, WorldVu Satellites Ltd. If the initial rollout is a success, the constellation could expand to 2,000 spacecraft.

The satellites, costing $350,00 each would weigh 285 lbs, and according to Branson, be placed into a 750 mile orbit by VG’s LauncherOne rocket. But there are some elements which don’t add up. Based on LauncherOne’s projected capacity of 500 lbs to LEO, the air launched small booster would only be capable of placing one satellite per launch into the higher orbit.  While Branson seemed to indicate that VG would handling all the lifting, Wyler, in a separate interview suggested there would be several launch providers taking a clustered approach aboard larger boosters, with VG playing a lesser role. That interpretation would seem to make more sense, as the projected price tag for LauncherOne, at roughly $10 million per flight of the fully expendable two stage pressure fed RP-1 and LOX booster would easily surpass the project’s estimated $2 billion budget, even when taking into account internal rates.

Depending on the specifics of the SpaceX satellite announcement, and whether or not it is an entirely separate effort as today’s news suggests, the second coming of hyper-ambitious large satellite constellations could portend a major change in the rapidly evolving small satellite launch market, providing the quantities of scale necessary to cement the role of some providers while threatening the business case for others.

Much will depend on whether or not the two efforts are complimentary, or competitors, and whether or not a success by either is enough to draw other providers into the market who do not come with their own launch companies. If the latter is the case, the ultimate result could spur serious interest in bringing re-usability to the small side of the industry.

After all, a $10 million launch tab to replace a single failed $350,000 satellite is a bit pricey.