| 3.1 Communications Market | 3.2 Space Manufacturing | 3.3 Remote Sensing | 3.4 Government Missions | 3.5 Transportation Missions |
| 3.6 Entertainment | 3.7 New Missions | 3.8 Space Utilities | 3.9 Extraterrestrial Resources | 3.10 Advertising |
As soil sample missions have only been accomplished on a few occasions to date and as the United States currently has no operating interplanetary landing and return vehicles, this would involve many technical, financial, and schedule complexities yet to be resolved. Once these items are obtained, they could be shipped for sale through stores, catalogs, TV shopping networks, and consignment auctions.
We would not attempt to enter the market for extraterrestrial materials retrieved from the Moon and other planetary bodies until an interplanetary landing and return system was on line. We would work within the constraints and stipulations of that system and would not attempt to change its operating procedures. If possible, we would attempt to influence the design and operations plan early in the development program, but this market cannot support sharing in the development of such a system and expect to turn a profit. We would require a processing and packaging facility to prepare the items for mass distribution. Distribution and sales to final customers would be accomplished through a network of stores, catalogues, TV shopping networks, and auctions.
The Home Shopping Network was the first contact made in the novelties area. They appeared eager to consider the sale of space novelty items should some become available. They were unable to provide much practical pricing and demand data specifically associated with space items, however, they have a wealth of information on the price/demand of earthbound items such as jewelry and objects of art. Art may be the best class of items comparable to space novelties in that the value is based on perceived value. That is, the items often have little intrinsic value and the price is set by the value the customers perceive that item commands.
Sotheby's was also contacted to discuss the December 1993 auction of Soviet space memorabilia. A detailed description of the event is included in section 3.10.2.6.1.
Currently, the United States has no interplanetary landing and return system. Thus, this market could not be pursued until such a vehicle is developed. Justification for development of such a system would be from other market areas, since this area could not support amortization of system development cost and still expect to turn a profit.
For space-flown trinkets a high volume business plan must be established. Long term agreements with both the launch provider and distribution network must be formalized. The integration of these items into a launch vehicle would be identical to any other payload integration effort.
It is not clear at this point whether extraterrestrial materials retrieved from the Moon and other planetary bodies would be marketed as low-volume space trinkets or as high-value unique items. This will be determined upon our cost and ability to retrieve these items.
The total of the sale was $6,817,197, which included items ranging from a Soyuz TM-10 capsule for $1.6 million, a Cosmos capsule for $500,000, $400,000 for several tiny moon pebbles returned during Luna 16, and $6,500 for two photographs of Gagarin. Sotheby's also auctioned two pieces of Soviet equipment still sitting on the moon. Those went for $60,000, even though the buyer had no guarantee he could ever get the Luna 21 descent stage and a remote-controlled research vehicle to Earth.
Figure 3.10.2.6-1 shows the potential revenue by year that could be generated through the sale of novelties. It assumes that some hardware from Space Station Alpha or a lunar/planetary mission becomes available beginning in 1996. This does not include novelty items based on TV or other fictional media such as Star Trek.
Another sensitive issue involves the perception that the Russians have been reduced to selling off their national treasures. Although nearly all bidders at Sotheby's auction said they were thrilled to obtain such artifacts and memorabilia, some expressed discomfort that people were selling such valuable and historic items, such as the congratulatory telegram Khrushchev sent to Gagarin.
The impacts upon any transportation system would have to be negligible in order minimize the novelty cost. This market is exceptionally sensitive to transportation costs, as evidenced from the price elasticity charts. Therefore, the major contributor to the cost of sale is the transportation costs of launching and returning the items to Earth.
Although this market is not large enough to justify the development of a launch system on its own, it does offer an attractive opportunity for entrepreneurs to supplement revenue on space ventures.
Although it is extremely unlikely that advertisements could fund an entire mission, they may provide significant supplementary revenue. Advertisements may be purchased on their own, but they are generally integrated into overall promotional campaigns. As such, they have the potential to generate additional revenues on the order of $3 million to $5 million or more per mission. This may approach the funding necessary for a small launch vehicle mission, and the revenue from the additional payloads would be pure profit.
As noted in section 3.10.1, a group of Congressmen and Senators have initiated a bill to ban advertising in space. The bill is written so broadly that it could be implied that companies could not put their own names or their customers' names on their launch vehicles, space station components, or other hardware destined for space. It is also broad enough that any radio waves that escape into space and contain advertisements from television or radio would also be illegal. This bill has little support in Washington, but represents a real threat to this and other similar business prospects. Although some people believe that commercial sponsorship is the best thing that could happen to space in terms of bringing in general public support, others feel that space is a pristine environment, similar to our national forests, and should not be commercialized. For the purpose of this study, consideration of space orbiting billboards has been postponed, pending the outcome of this legislative effort.
The process of putting the advertisement on the vehicle is relatively simple, but some of the associated technical issues may present a challenge. The advertisements can weigh from 10 to 220 pounds, and this may necessitate changes to performance and trajectory analysis depending upon the capabilities of the vehicle. This is not insurmountable, but it does present hidden costs to implementing the advertising. The costs of obtaining government approvals to place advertising on those vehicles that carry government payloads may also present a costly and time-consuming process, if possible at all.
The primary contact made in the advertising area was Space Marketing, Inc. (SMI). SMI has spent the last 2 years researching the placement of advertising on launch vehicles and has an extremely good feel for the overall market and its price points. Additionally, we have found that it is often more productive to go to the main advertising firms rather that directly to potential companies because the decisions driving funding allocations are actually made at the advertising firm. Going to the advertising firms, who represent a wide range of companies, served two functions: (1) they informed us of the applicability of space-based advertising to their various clients, thereby reducing the number of direct contacts required, and (2) they were very helpful in referring us to forward-thinking decision makers in firms that they did not represent. The beverage, movie, and auto industries seem to be the most receptive to pursuing this advertising option.
It does appear that the launch variability of current systems is a concern. Most likely the advertisement on the launch would be tied to a larger advertisement campaign. It then is important to ensure we can launch close to the planned date. Any improvement in launch variability would increase the opportunities for business in this market.
A concern of the commercial advertisers is the timing of the launch carrying their advertisement. The advertiser generally has specifically targeted his advertising at a specific event. This generally is the initiation of a new product. Based on weather, satellite, and launch vehicle delays, the launch may not occur on the prescribed day, or even within the originally planned week. This is unacceptable to many of the polled advertisers and must be contractually addressed. For example, Columbia Pictures was willing to pay $500,000 for a 40-pound decal to be placed on the side of the first Comet launch to promote the release of "The Last Action Hero." As promised launch dates slipped, Columbia became less and less interested in the project, eventually questioning the concept in general.
Another issue is access to the space complexes where vehicles are launched. Originally, only Air Force and contractor personnel were allowed at Cape Canaveral Air Force Station to view launches from the Florida launch sites. These restrictions are loosening; however, to date no one has attempted to bring in large TV and commercial film companies to film a launch. The first attempt is likely to meet with significant resistance. Other launch sites for international launch vehicles have not shown any hesitation to allow primarily unrestricted access to the launch sites. This situation may present a great disadvantage to U.S. firms as this market becomes increasingly competitive.
The process of putting the advertisement on the vehicle is relatively simple, but some of the associated technical issues may present a challenge. The ads can weigh from 10 to 220 pounds, and this may necessitate changes to performance and trajectory analysis depending upon the capabilities of the vehicle. In addition, some potential payload capability will be supplanted to accommodate the advertisement weight. It will be a revenue tradeoff to determine when payload capability should be sacrificed to accommodate the advertisement. For advertising, there will be a startup period where the novelty of placing advertisement on a launch vehicle will generate sales of $10 million to $20 million ($1 million per launch).
A significant issue will be to obtain government approval to place advertisements on vehicles that the government purchases or on which it places a payload for launch. Another primary concern of the commercial advertisers is the timing of the launch. The advertiser generally has specifically targeted his advertising at a specific event. Another issue is access to the space complexes where vehicles are launched. Current restrictions are loosening; however, to date no one has attempted to bring in large television or commercial film companies to film a launch.
Although it is extremely unlikely that advertisements could fund an entire mission, they may provide significant supplementary revenue on the order of $3 million to $5 million or more per mission (which may approach the funding necessary to justify a small launch vehicle mission).
The demonstration of products on orbit, like advertising, would be integrated into a company's promotional campaign. In general, demonstrating products on orbit serves little, if any, technical purpose. The companies considering such a demonstration, however, felt the use of their products on orbit provided them technical credibility and further added a feeling of "toughness" and "reliability." This change in public perception is the value-added contribution of an on orbit product demonstration from their point of view. Additionally, if any of these demonstrated products can be returned to earth, it appears that there would be a substantial market for the sale of such items.
Space Marketing, Inc. (SMI) was also a very helpful contact in the area of product demonstrations. SMI has spent well over a year researching the market for the demonstration of commercial products on launch vehicles and has an extremely good feel for the overall market and its price points. As these demonstrations are also projected to be integrated into large advertising firms rather than directly to potential companies. The soft drink companies and several artists have been active in this area and show a desire to continue their involvement should an appropriate opportunity arise. Coca Cola has placed their specially developed soda can aboard both the space shuttle and MIR. The high-tech consumer product and auto industries also seem to be receptive to consider demonstrating their products in space.
When EVA becomes a consideration, policies have to be developed to minimize the safety and risks that would be taken for this commercial venture. There would likely be significant reluctance from the astronaut/cosmonaut corps for the risks inherent in such an enterprise.
The public was more than willing to pay substantially higher prices for these products than for their earthbound counterparts. As an example of a more complex demonstration, Coca Cola and Pepsi each developed special soda cans that were used to dispense their soft drinks aboard the U.S. space shuttle. Although these items have not been offered for sale to the commercial market, these commercial firms were willing to invest their own discretionary moneys to fund the development of these products.
The primary restriction on the market for those products that require demonstration and return to Earth is the availability and frequency of transportation that can provide such a round-trip. The Russians have ELV-capsule combinations that can perform such tasks at a much lower cost and higher frequency than can the U.S. shuttle. On the other hand, if it were relatively easy and inexpensive to perform such tasks, the value of these items may be dramatically reduced.
Figure 3.10.4.6-1 shows the potential revenue by year that could be generated through the sale of product demonstrations using today's vehicles. This chart encompasses all types of product demonstrations from orbital to planetary missions.
Additionally, the commercialism of space seems to have a questionable morality in the eyes of some people. This needs to be addressed before large commercial firms will risk their corporate image.
In general, demonstrating most products on orbit serves little, if any, technical purpose. The companies considering such a demonstration felt the use of their products on orbit provided them technical credibility and further added a feeling of toughness and reliability.
Demonstrating the product may be as simple as a video of the product in the desired space atmosphere or as complicated as performing a complex series of operations requiring human interaction and involving EVA. The soft drink companies and high-tech consumer product and auto industries seem to be receptive as do several artists. These customers may not have the potential to generate enough revenue to finance an entire launch, but depending on the complexity of the demonstration, they can be expected to contribute $3 million or more.
Key issues that restrict current product demonstration activities are both the lack of opportunities for transportation to space and the lack of an ability to return items to Earth. Perhaps a vehicle such as a single-stage-to-orbit or a return capsule that could de-orbit payloads launched on ELVs could satisfy these requirements. The development of a return capability probably could not be financed by users currently identified.
This market is not large enough to justify the development of a launch vehicle on its own. It could be anticipated that revenues of $3 million per launch could be realized with minimal impact to the launch system.
No cremains have as yet been sent into space by this group or any other. Celestis is waiting for SSI to begin regular launches before it reorganizes and starts taking orders.
After researching the published history of this project and having phone discussions with the principals, it was discovered that this market has the potential for purchasing multiple dedicated launches on an annual basis indefinitely. The nature of the payload and its requirements also make it a good candidate for piggyback payloads that could be included when excess payload capacity is available to help defray the costs of a nondedicated launch.
All of this demonstrated interest in space burial has occurred with an expected cost per burial of over $3,000. The Conestoga 2's expected cost to low earth orbit is $10,000 per pound. The cost for an earth escape trajectory is $50,000 per pound. All of the people contacted thought that reducing the cost per burial would significantly increase the market. The last quoted cost of $3,900 was more expensive than the cheapest cremation, but is competitive with low end embalming and casket burial. This figure includes a $700 fee for processing and recremating a three to four pound set of standard cremains down to 0.25 ounces.
If a new commercial launch vehicle would lower launch costs to less than $1,000 per pound, space burial could become cheaper than almost any traditional cremated remains memorial. Cremation, all by itself without any memorial service, costs between $350 and $1,250. The lower cost cremations are done by cremation societies such as the Neptune Society. The higher cost cremations are performed at the more elaborate funeral homes. Ground urn burial averages $1,000, depending on the size and type of marker. A wall niche in a mausoleum starts at $5,000. The nationwide average funeral cost for burial in an 18-gallon steel casket is $6,500.
An additional market segment that is harder to estimate, but is still expected to be substantial is the "at need" market. These potential customers are families who have cremated a family member, but haven't disposed of the ashes in a permanent fashion. In this country alone there are thousands of unclaimed remains in funeral-home storage rooms. Part of the difficulty is the increasing environmental restrictions, even for scattering at sea. Scattering over land is illegal in several states and most big cities. Space burial may appeal to families of recently deceased who were known to be interested in the space program or science fiction.
The process starts when a normal set of cremains are received and placed in a higher temperature retort until the ashes are reduced to 0.25 ounces. The refined cremains are then loaded into individually labeled capsules and placed in secure storage until enough capsules are processed for another launch.
Celestis asked potential customers if there was a specific time limit desired for the amount of time between delivery of ashes and launch. None was ever identified. In fact, there are deceased who have indicated in their wills that they wish their ashes to be launched as soon as the service becomes available.
Each loaded capsule weighs 0.5 ounces and a fully loaded Celestis-Conestoga spacecraft is designed to carry 10,330 capsules. Total weight is 350 pounds with a 32-inch height and a 24-inch diameter. The configuration is shown in figure 3.10.5.3-1.
The remains are not spread across space or released in any manner. The cylinders are labeled with name, religious symbol of choice, and identifying data to verify that they are not being illegally mixed together. The payload carrier is permanently welded shut prior to being stacked on the erect Conestoga. This capsule was to have a highly reflective exterior coating to make it visible from the ground with the aid of small telescopes or binoculars. This may be changed because of astronomer concerns.
A reflective coating was planned for the first vehicle because it was an orbital mission. Escape trajectory flights were being considered for subsequent missions because of the protests from astronomers after DOT permission was announced. An especially bright satellite passing through the field of view of a telescope with a digital camera can disturb measurements as well as cause streaks on the photograph.
The Japanese market appears to have the greatest potential for immediate success. Several major Japanese corporations and the Japanese government made official contact with Celestis concerning this project. The Japanese are very receptive to innovation and have a calmer approach to death than most Westerners.
The fact that the vast majority of Japanese are Buddhist lends itself to space burial of ashes. In addition to advocating cremation, the Buddhist religion has a tradition of separating ashes, sending portions to different relatives, friends, shrines, etc. A small portion could be sent into space without the cost of recremation.
Japanese interest in the concept resulted in Celestis being interviewed and featured on various Japanese television programs. In fact, Celestis has been featured on BBC-TV, German, and Norwegian television as well. In the United States, it was a show topic for Beyond 2000 on the Discovery Network.
The size of this market is large enough to where even very small market shares can result in substantial annual business. A market share of 1/2% of only the countries listed, at a launch fee of $3,000 per cremain, results in almost $150 million in annual sales. The market will increase along with the world's population and the spread of wealth to former Third World countries.
All transactions prior to launch can be handled by mail. The post office allows cremains to be sent as normal mail. Special shipping containers would be sent to friends or relatives of the deceased to be returned for processing. The capsule would be shipped to the vehicle launch processing site after enough cremains are received. Videotapes of the launch and trajectory data would be sent to the surviving families as proof of delivery.
Each Conestoga launch was expected to cost Celestis $15 million. At that rate 5,000 separate remains would be required on each flight at $3,000 each in order to break even. The Conestoga 2 can deliver 1,500 pounds to low earth orbit, but that drops to about 300 pounds for a 1,900-mile circular orbit or an Earth escape trajectory.
A possible option for Earth escape missions would be to use the Conestoga 4 vehicle, which can deliver 900 pounds beyond the moon. The complexity of escape trajectory missions should be similar to orbital missions using the same booster because there is no significant increase in accuracy or deep space tracking required.
Ashes that are to be recremated are placed in a small retort that burns a special gas mixture. The much higher temperature further reduces the ashes to their very base elements. These reduced cremains are then loaded into individually labeled capsules and placed in loading trays in secure storage until enough capsules are processed for another launch. Each loaded capsule weighs 0.5 ounces and a fully loaded Celestis-Conestoga spacecraft is designed to carry 10,330 capsules.
The only flight data that might be required is radar tracking of the trajectory. This information would assure relatives that the capsules were delivered as advertised and would eliminate fears that they might reenter the Earth's atmosphere or be a hazard to satellites.
Celestis tried to convince the state that they were only a transportation service. However, the mortuary industry in Florida has, not surprisingly, a very strong lobby and they want to restrict cremation as much as possible. Caskets, tombstones, and family mausoleums are much more profitable. Celestis is currently trying to find a state to incorporate in that has more lenient preneed contract entrustment laws. The United States is the only country that has this type of funeral industry regulation.
This issue is significant due to the modern nature of the funeral industry. Preneed contracts are the most rapidly growing part of the industry. Nationally they account for 50% to 60% of all business, and that percentage is growing. In Florida it is over 90%. The contracts are insured by individual states and the funeral industry as a group. Nearly bankrupt funeral homes or cemeteries are quietly purchased by conglomerates and their preneed contracts honored to maintain the integrity of the business as a whole.
Entrustment laws pose a much smaller problem if a commercial launch service is developed that has the financial resources to await payment until immediately before or after launch. The national average time period between purchase of a preneed contract and customer death is 7 to 10 years.
If cremains are launched as a secondary payload, issues that have to be resolved include compatibility and liability to the primary payload. If the cremains carrier is a passive system attached to the upper stage this shouldn't be a problem. If the burial spacecraft is actively jettisoned or requires the upper stage to perform additional maneuvers, then it may pose a risk to the primary payload.
This problem should be reduced for a new launch system that is designed from the start for commercial payloads. Cost per launch will be more important than image, and any commercial payload or piggyback payload that helps to offset the cost of the system will be valuable.
The nature of ashes makes it a good piggyback payload. Its very low density and totally benign characteristics when completely sealed means that large numbers could be easily added to the manifest of a deep space mission. They would simply remain with the upper stage that separated from the primary payload if the stage had an acceptable post separation orbit. The amount of revenue they could generate (Celestis estimates approximately $100,000 per pound) is significant.
A space burial payload is not a single high-cost payload, but is many low-cost payloads combined to pay for each launch. The payload is very robust, virtually unaffected by the space environment, and has no mechanical, chemical, or electrical function it has to perform. In fact, it doesn't communicate or interface with the Earth again after it is launched. A space burial mission is successful if the launch is successful, and that simplicity enhances the chances for long-term profitability.
3.10.2 Novelties
3.10.2.1 Introduction/Statement of Problem
The novelties area covers the sale of used/spare space assets, objects captured from space, and items flown specifically to be resold as "space trinkets." Although this is an ongoing market, it has been severely limited by the availability of suitable items. Due to the scarceness of these items, their sale has been generally confined to highly specialized auctions. Considering the demand for such items and the prices at which they are sold, it may appear that there is a significant opportunity being missed. However, it must be remembered that it is the scarcity itself that forms the value of these items since their intrinsic value is generally negligible. For instance, moon rocks would have little or no value if it wasn't for their origin.3.10.2.2 Study Approach
Our approach to characterizing this market area included the assessment of potential customers of used/spare space assets, objects captured from space, and items flown specifically to be resold as space-flown trinkets. As such, several specialized auction houses (e.g., Sotheby's), unique catalogue sales outlets (e.g., Edmund Scientific), exclusive high-end specialty stores (e.g., The Sharper Image and The Nature Store), and the television shopping networks (e.g., QVC) were identified as potential contacts. Each would have an interest in reselling space novelty items and would have insight into the potential revenue and price sensitivities. 3.10.2.3 Market Description
3.10.2.3.1 Market Evaluation
The availability of items for sale has been severely limited in the past, which contributes to the perceived value. The market for high-end, unique items (e.g., a space capsule) would be dictated solely by this demand. For space trinkets, it is envisioned that such items as a shuttle GAS can or mid-deck locker for patches, flags, and the like be used. These types of items could produce significant revenue through mass sales at reasonable prices, targeted specifically at visitors to museums. 3.10.2.3.2 Space Application Description
Obtaining the desired items is the largest technical challenge in the novelties area. It could be as easy as purchasing space in a mid-deck locker or GAS can for space-flown trinkets such as patches and flags, or the purchase of spares and/or returned actual flight items from NASA and other international space organizations. On the other hand, specific missions could be designated to return materials from the moon and other planetary bodies. 3.10.2.3.3 Market Assessment
Any terrestrial item flown in space has the same intrinsic value as an identical Earth-bound item. The apparent higher value of a space flown item is due to the mere fact it has flown in space. This increased value is a direct result of the relative rarity of space flown objects. A significant market for serious collectors of as-flown unique hardware currently exists, as evidenced by a December 1993 Sotheby auction which netted nearly $7 million (see sec. 3.10.2.6.1). Space trinkets seem to have a great potential, but no commercial venture has been pursuing them. 3.10.2.3.4 Infrastructure
This market area can only be successful if it works within the existing and evolving space infrastructure. Recouping "as-flown" merchandise for resale would only require negotiating a long-term contract with appropriate space agencies and would require no physical change to the existing infrastructure. To establish a new market in the low cost, higher volume space-flown trinkets would require contracting for mid-deck locker or GAS on the shuttle, but again there are contracting mechanisms in place to accomplish this without any changes to existing infrastructure. 3.10.2.4 Prospective Users
There are two feasible methods of distribution of space novelties. First is to deal directly with a network of stores, catalogues, TV shopping networks, and auction houses. The second is to hire a single entity to interface with the network of distributors. It is not feasible to distribute directly to final customers. We have not determined which method is preferred. 3.10.2.5 CSTS Needs and Attributes
3.10.2.5.1 Transportation System Characteristics
The impacts upon any transportation system would have to be negligible in order to minimize the novelty cost. There are no impacts on current launch vehicles for all markets excluding interplanetary retrieval. We would require the use of a mid-deck locker or GAS on the shuttle for space-flown trinkets for these markets, and there are already procedures in place to perform this type of mission. To capture the market for return materials from the Moon and other planetary bodies would require a new launch system. 3.10.2.5.2 Ground Segment
Any ground segment impacts to a potential launch system could be minimized by design. We would work within the existing infrastructure. As above, we assume the ground segment for a interplanetary landing and return system would be in place prior to our entering such a market. 3.10.2.5.3 User/Transportation Interfaces
To minimize costs, the integration and interfaces for space-flown trinkets must be small. As-flown-unique items and other space memorabilia would not require any integration or interface. Returned extraterrestrial materials would require a minor investment in a processing and packaging facility to prepare items for final distribution. 3.10.2.5.4 Management and Policy
The management and dispensation of as-flown memorabilia is critical to maintaining its value over the long term. Investors and collectors must be assured that these items will not flood the market, thus maintaining the perceived value. It is likely that the historical value of these items will always limit the availability. However, we must develop and adhere to some formal policy and establish guidelines. 3.10.2.5.5 Improvements Over Current
With the small investment required to enter this market, there is no requirement for improvements in terms of reliability or operations turnaround. For space trinkets and potentially extraterrestrial materials, we would be an auxiliary payload, and we must ensure this does not cause problems. Clearly we are launch cost sensitive, and any decrease in launch cost would be beneficial, but not a market entry barrier. 3.10.2.6 Business Opportunities
3.10.2.6.1 Cost Sensitivities
Due to the relatively limited revenue potential of this market, it is highly unlikely that the sale of novelties could finance entire missions on their own. However, if a mission were to bring back salable items as a consequence of lunar mining, sample returns, and the like, the sale of related novelties could supplement the scientific revenues of a mission by approximately $20 million. The sale of trinkets, Moon rocks, spare/used space suits, and returned capsules has been ongoing since the mid-1970s. Some auction houses such as England's Sotheby's say that although it is very difficult to estimate the sale prices of space items, a Sotheby auction in December 1993 sold more than 200 items from the heyday of the Soviet space program, including a dozen pieces of memorabilia connected with Yuri Gagarin's 1961 flight.
Figure 3.10.2.6-2 shows the sensitivity to price per pound for varying priced novelties ($100 to $1 million per item). This market is exceptionally sensitive to transportation costs. We assumed that items returned from other planetary bodies are free to those who are able to obtain them. Therefore, the major contributor to the cost of sale is the transportation costs of returning the items to Earth.
3.10.2.6.2 Programmatics
A principal concern is availability of materials. So far, no commercial ventures have been started to lease a shuttle GAS can or mid-deck locker expressly for this purpose. For extraterrestrial material return, the primary concern is waiting for the development of a new interplanetary landing and return system, or purchase/lease of current Russian systems. Additional concerns for extraterrestrial material return are the legal and ethical questions such as who has the right to separate and return a piece of an asteroid. Extraterritorial rights may eventually have to be established. 3.10.2.7 Conclusions and Recommendations
The novelties area covers the sale of used/spare space assets, objects captured from space, and items flown specifically to be resold as space trinkets. Although this is an ongoing market, it has been severely limited by the availability of suitable materials and sales have been generally confined to highly specialized auctions. Obtaining the desired items is the largest technical challenge in this area. Considering the demand for such materials and the prices at which they are sold, it may appear that there is a great opportunity being missed. A market for serious collectors of as-flown hardware currently exists, as evidenced by a December 1993 Sotheby auction that netted nearly $7 million for over 200 items. However, it must be remembered that it is the scarcity itself that forms the value of these items since their intrinsic value is generally negligible. Space trinkets, such as flags and patches flown for resale, seems to have a great potential, but no commercial venture has been pursuing this market. 3.10.3 Space Advertisement/Orbiting Billboards
3.10.3.1 Introduction/Statement of Problem
The use of launch vehicles as an advertising medium is a newly evolving market with the potential to make substantial financial contributions. Several major commercial advertising firms have already contracted to place advertisements for their clients on both U.S. and international vehicles. In the past, launch vehicle manufacturers have used the advertising space to promote their subcontractors and suppliers, as well as the payload manufacturer or end user. These events have generally not involved any monetary compensation, but have been used to promote overall programs in hope of increased future sales. 3.10.3.2 Study Approach
Our approach to characterizing this market area included the assessment of potential customers of launch vehicles as an advertising medium. Providers of decals used for the advertising (e.g., Vision Graphics), enabling companies (e.g., Space Marketing, Inc.), users (e.g., Columbia Pictures, Coca Cola), and advertising agencies (e.g., Creative Artists Agency) would all have an interest in space advertising and would have insight into the potential revenue and price sensitivities. 3.10.3.3 Market Description
3.10.3.3.1 Market Evaluation
Several major commercial advertising firms have already contracted to place advertisements for their clients on both U.S. and international vehicles. The advertising firms view this medium as very similar to placing advertising on Indy cars, stock cars, or power boats, except with more hype, and, therefore, more media coverage. In the past, launch vehicle manufacturers have used the advertising space to promote their subcontractors and suppliers, as well as the payload manufacturer or end user. These events have generally not involved any monetary compensation, but have been used to promote overall programs in hope of increased future sales. These events are expected to continue; however, some space may be supplanted by revenue-generating advertising. 3.10.3.3.2 Space Application Description
Once contracted, the advertisement is generally painted on the vehicle using a method very similar to custom paint jobs on automobiles. Special paints must be used because of the harsh environments seen by the launch vehicle. Another option is to have a decal produced of the advertisement that can then be applied to the vehicle. These decals are generally applied in sections not exceeding two-foot square, ensuring a large piece will not become detached and interfere in the operation of the vehicle. 3.10.3.3.3 Market Assessment
Although it is extremely unlikely that advertisements could fund an entire mission, they may provide significant supplementary revenue. Advertisements may be purchased on their own, but they are generally integrated into overall promotional campaigns. As such, they have the potential to generate additional revenues on the order of $3 million to $5 million or more per mission. For example, Columbia Pictures was willing to pay $500,000 for space on the side of the first Comet launch to promote the release of "The Last Action Hero." This was split between Westinghouse (Conestoga) and Space Marketing, Inc. 3.10.3.3.4 Infrastructure
Painting or decals appearing on a launch vehicle would likely be applied at the place of manufacture on a noninterference basis. Thus, we could support this market by working within the current infrastructure. Paints and/or decals could be contracted through existing businesses, and the launch itself would be conducted within the current environment. This market could require additional mission analysis for those launch systems that are performance limited. This would be conducted by those already performing mission analysis for the system and would not require further infrastructure. 3.10.3.4 Prospective Users
There are three types of potential customers: (1) enabling companies (e.g., Space Marketing, Inc.), who would aggressively focus on attracting companies to advertise in space, (2) advertising agencies (e.g., Creative Artists Agency), who would examine space as one alternative for their customers, and (3) users (e.g., Columbia Pictures and Coca Cola). 3.10.3.5 CSTS Needs and Attributes
3.10.3.5.1 Transportation System Characteristics
The impacts upon any transportation system would have to be negligible in order to minimize the advertising cost. For advertising, the decals would be of minimal weight and would need to be of significant size to be recognizable from a distance for photographic exploitation. Any other impacts would, by design, be minimal. The impacts to performance due to weight, especially on small launchers, would have to be addressed. 3.10.3.5.2 Ground Segment
Any ground segment impacts to a potential launch system would be minimal by design. 3.10.3.5.3 User/Transportation Interfaces
To minimize costs, the integration and interfaces for advertising would be, by design, small. 3.10.3.5.4 Management and Policy
Although no clear, consistent policy exists across all launch service providers for advertisement space, each has shown considerable interest. It is recognized that for a minimal weight penalty, a significant amount a revenue can be obtained. However, the advertisers are also highly schedule driven, which has been a stumbling block in the past. Since the launch providers are primarily interested in their deployable payload customers, a discord exists. This discord is not viewed as being significant or insurmountable. 3.10.3.5.5 Improvements Over Current
Currently, only fledgling efforts are being made into space advertising, and these are limited to the promotion of aerospace companies and/or programs. Relatively minor impacts to a launch vehicle by commercial ventures has the potential of increasing revenues for the launch services provider and improving visibility for both the vehicle and the commercial promotion. 3.10.3.6 Business Opportunities
3.10.3.6.1 Cost Sensitivities
For advertising, there will be a start-up period (2 to 3 years) where the novelty of placing advertisement on a launch vehicle will generate sales of $10 million to $20 million ($1 million per launch). After the initial thrill has dispersed, these ads will be integrated into promotional campaigns just as a television advertisement or billboard would be utilized. Figure 3.10.3.6-1 summarizes the expected revenues due to advertising while figure 3.10.3.6-2 summarizes the market elasticity. The elasticity is based on a price per advertisement basis and has little (if any) relation to the cost of launching a payload.
3.10.3.6.2 Programmatics
A significant issue will be to obtain government approval to place advertisements on vehicles that the government purchases or on which it places a payload for launch. This has proven to be a very cumbersome process for the launch vehicle manufacturers who have attempted to pursue this route, and many have received differing opinions from various officers within a service. Efforts up to this point have been directed towards purely commercial launches.
3.10.3.7 Conclusions and Recommendations
The use of launch vehicles as an advertising medium is a newly evolving market with the potential to obtain substantial revenues. Several major commercial advertising firms have already contracted to place advertisements for their clients on both U.S. and international vehicles. In the past, these events have generally not involved any monetary compensation, but have been used to promote overall programs in hope of increased future sales. Although no clear, consistent policy exists across all launch service providers for advertisement space, each has shown considerable interest. Columbia Pictures was willing to pay $500,000 for a 40-pound decal on the side of the first Comet launch to promote the release of "The Last Action Hero." The beverage, movie, and auto industries seem to be the most receptive to pursuing this advertising option.3.10.4 Space Product Demonstration
3.10.4.1 Introduction/Statement of Problem
The ability to demonstrate commercial products on orbit has existed since the early 1980s with the initiation of several commercial launch vehicle companies. However, most commercial manufacturers have not been informed of the potential opportunities and therefore have not pursued such avenues. The response we received from the majority of companies that were contacted was one of surprise that such capabilities existed. Their immediate concern was, of course, cost. Space carries with it an air of infinity where the costs to access space are exceeded only by its physical size. When today's actual costs were communicated, there was a general indication that they were significantly lower than expected; still high, but potentially manageable. 3.10.4.2 Study Approach
Our approach to characterizing this market area included the assessment of potential users of the capability to demonstrate commercial products in space. Space Marketing, Inc. (SMI) was identified primarily due to its research of the overall market and its price points. Several large advertising firms were identified (i.e. Creative Artists Agency) along with firms that have already used space for demonstrations (i.e. Coca Cola Company). Each would have insight into the potential revenue and price sensitivities. 3.10.4.3 Market Description
3.10.4.3.1 Market Evaluation
Companies considering a space product demonstration felt the use of their products on orbit gave them technical credibility and further added a feeling of toughness, reliability, or intrinsic value. This change in public perception is the value-added contribution of an on orbit product demonstration from their point of view. The "stunt" value is also an important addition to any promotional campaign. Like advertising, the demonstration of products on orbit would be integrated into a company's promotional campaign. No firm has been actively pursuing this market area, as yet. 3.10.4.3.2 Space Application Description
Contracts and the actions performed in demonstrating products will vary widely. The actions begin with launching the desired products into orbit. At this point, commonalty disappears. Some products may have to be operated, while others may just have to show evidence of the trip. Demonstrating the product may be as simple as a video of the product in the desired space atmosphere or as complicated as performing a complex series of operations requiring human interaction and involving EVA. The location of the demonstration may range from low earth orbit to planetary ventures. The final destination of the product may range from random locations dependent upon other payloads to planetary bodies or even returning them to Earth. 3.10.4.3.3 Market Assessment
Any item flown or tested in space has an added feeling of toughness, reliability, or intrinsic value by the consumer. Since there has been evidence that commercial firms are willing to invest their own discretionary moneys to fund the development of their products for space demonstrations (Coca Cola and Pepsi), significant revenue could be expected. However, as with advertising, it is unlikely that product demonstrations could finance an entire launch. 3.10.4.3.4 Infrastructure
Potential customers interested in space product demonstrations will have requirements ranging from something as simple as a video of the product in space to something as complicated as performing a complex series of EVA operations. Any launch system would have to provide accommodations for both extremes, or limit the types of product demonstrations performed to be consistent with launch system capabilities. Something as extreme as requiring EVA operations could involve extreme crew safety and risk that would render the demonstration cost prohibitive. It is likely that revenues would be directly tied to the impacts and complexity placed upon the launch system, which would be minimized by design. 3.10.4.4 Prospective Users
As with space advertising, there are three types of potential customers: (1) enabling companies (e.g., Space Marketing, Inc.), who would aggressively focus on attracting companies to launch product demonstrations into space, (2) advertising agencies (e.g., Creative Artists Agency), who would examine space as one alternative for their customers, and (3) users (e.g., Coca Cola). 3.10.4.5 CSTS Needs and Attributes
3.10.4.5.1 Transportation System Characteristics
Transportation systems characteristics could be as minimal as stowage of an autonomous demonstration as a secondary payload to as complex as the design of a payload destined for travel to other planetary bodies and return. The ground segment would be markedly different for each type mission, with the latter being the most complex. For the near term, it is unlikely that product demonstrations could finance an entire launch. As such, impacts to the transportation system would be minimized. 3.10.4.5.2 Ground Segment
With the exception of the design of an interplanetary landing and return vehicles (not justified solely by this market), any ground segment impacts to a potential launch system would be minimized by design. 3.10.4.5.3 User/Transportation Interfaces
Since it is unlikely that product demonstrations could finance an entire launch, impacts to the transportation system would be minimal. Some demonstrations could be as simple as a time sequenced event on-orbit to being as extensive as requiring significant crew interface or EVA, or a payload destined for travel to other planetary bodies and return. Each case has dramatically increased interface requirements. 3.10.4.5.4 Management and Policy
The fundamental restriction on the market for those products that require demonstration and return to Earth is the availability and frequency of transportation that can provide such a round-trip. The Russians have ELV-capsule combinations that can perform such tasks at much lower cost and higher frequency than can the U.S. shuttle. The development of a return capability probably could not be financed by users currently identified. 3.10.4.5.5 Improvements Over Current
Currently, no capability exists for simple, low-cost space product demonstrations. Commercial firms are unfamiliar with the costs and impacts of such a capability and how it could aid in the marketing or establishment of their product. The attempts made so far have been fairly simple and limited (e.g., Coca Cola), and a significant effort would be necessary to educate potential customers. 3.10.4.6 Business Opportunities
3.10.4.6.1 Cost Sensitivities
As with advertising, it is unlikely that product demonstrations could finance an entire launch. Product demonstrations and advertising will likely be integrated into a large promotional campaign. These campaigns may not have the potential to generate enough revenue to finance an entire launch, but depending on the complexity of the demonstration, they can be expected to contribute $3 million or more. As past examples of relatively simple demonstrations, commercial products such as paintings and compact discs have been flown up to the Russian MIR space station and returned to Earth for sale.
Figure 3.10.4.6-2 shows the dispersion of product demonstration opportunities by the price. For instance, there appears to be approximately 21 potential payloads for which the demonstration complexity would require a price of $100,000 per payload whereas there is only a single payload where the complexity of the mission would require a price of $50 million and the customer would be willing to pay that price. The bars show the total revenues that could be generated by each class of demonstration.
Figure 3.10.4.6-3 shows the sensitivity to price per pound for varying levels of mission complexity ranging from missions that would command a price of $100,000 per demonstration to missions that would command a price of $50 million per demonstration. 3.10.4.6.2 Programmatics
Key issues that restrict current product demonstration activities are both the lack of opportunities for transportation to space and the lack of a capability to return items to Earth. Perhaps a vehicle such as a single-stage-to-orbit could satisfy these requirements. A return capsule that could de-orbit payloads launched on expendable launch vehicles could also perform this function. In the near term, impacts to interfaces and procedures would have to be minimized.
3.10.4.7 Conclusions and Recommendations
The ability to demonstrate commercial products on orbit has existed since the early 1980s with the initiation of several commercial launch vehicle companies. However, most commercial manufacturers have not been informed of the potential opportunities and therefore have not pursued such avenues. The response we received from the majority of companies that were contacted was one of surprise that such capabilities existed, with their immediate concern being cost. There was a general indication that costs were significantly lower than they had expected; still high, but potentially manageable. 3.10.5 Space Burial
3.10.5.1 Introduction/Statement of Problem
In 1985 the Transportation Department granted mission approval for preliminary plans of Space Services, Inc. (SSI) to carry cremated human remains into space in 1986 or early 1987. SSI, whose president was former astronaut Donald K. "Deke" Slayton, developed the Conestoga booster as a commercial space venture. The launches were to be contracted for by the Celestis Group of Melbourne, Florida, a consortium of morticians and former KSC contractor engineers. 3.10.5.2 Study Approach
The data for this market study was primarily obtained from published articles written in the mid-1980s and interviews with people involved in the project. SSI was bought by EER Systems after 1987 and started focusing on NASA programs. Contact was made with former SSI employees who identified people involved in the original space burial program. These individuals in turn led to contact with the Celestis Group. 3.10.5.3 Market Description
The market for space burial is based on a variety of emotional desires as is most of the funeral industry. Burial in space is a modern day extension of burial at sea and probably appeals to the same type of person. A sense of permanence is achieved not by a stone monument but by essentially endless travel over an infinite distance. Space burial appeals to fans of the world's space programs, science fiction, and high technology in general. It also can be marketed as an environmentally clean method that doesn't take up dwindling real estate or pollute the ocean. 3.10.5.3.1 Market Evaluation
The research and experience of Celestis during their initial startup indicates that there is a substantial market for this service that should grow even as it becomes less of a novelty and more of a routine service. After the news broke that SSI had received permission to plan a launch, both SSI and Celestis received, and continue to receive, thousands of requests from all over the world to sign up for the plan. 3.10.5.3.2 Space Application Description
The following technical description is based solely on the work that was done in the mid-1980s by Celestis, Inc., and Space Services, Inc. Since then, SSI has been bought by EER Systems and Celestis has essentially shut down because of lack of funds to maintain it while waiting for the Conestoga to begin launching regularly. Celestis was also hampered by Florida state regulations governing the funeral industry. These problems will be discussed in the Management and Policy section (sec. 3.10.5.5.4).
3.10.5.3.3 Market Assessment
Preliminary discussions with some of the people involved in Celestis, and the old SSI, indicate that the biggest market probably will be the foreign market. Cremation is much more common in Europe and Japan than in the United States. Figure 3.10.5.3-2 indicates the size of that difference. Rates have increased since then and continue to do so. The percentage in the United States is expected to grow to 30% by the year 2000 as the cost of traditional burial gets more prohibitive and the population becomes more environmentally conscious.
Nation/Region Rate Population Cremations Scandinavia 85 % 22.5 M 191.3 K Germany 65 % 77.7 M 505.1 K Great Britain 75 % 56.3 M 422.3 K Spain 20 % 38.7 M 77.4 K Italy 20 % 57.2 M 114.4 K France 25 % 55.4 M 138.5 K Soviet Union 50 % 280.1 M 1,400.5 K Australia 65 % 16.0 M 104.0 K Japan 90 % 121.5 M 1,093.5 K China 50 % 1,052.5 M 5,262.5 K Canada 25 % 25.6 M 64.0 K United States 20 % 241.6 M 483.2 K TOTAL 9.86 M (Assuming a typical 1% mortality rate.)
3.10.5.3.4 Infrastructure
Space burial companies in the future will deal directly with the public, without any connection to funeral homes. This significantly reduces the amount of regulation and state board involvement because the launch would be legally just another transportation service. 3.10.5.4 Prospective Users
The following persons were involved in the original space burial project for SSI and/or are currently part of the Celestis Group. The literature search indicated that there were other organizations interested in the business, but none of them were as committed as SSI and Celestis.
The majority of the data presented in this report was obtained from John R. Cherry.
3.10.5.5 CSTS Needs and Attributes
The market for space burial already exists. The main thing that is required to capture the market is an organization with reliable access to space. The launch provider must take the concept seriously and partner itself with someone in the funeral industry. The biggest attribute that will cause the market to grow is the publicity of successful launches. Advertising and competitive pricing will also increase the market, but the biggest driver will be the knowledge that it is a viable and respectable option in the near and distant future. 3.10.5.5.1 Transportation System Characteristics
The only technical data developed so far has been based on using a Conestoga 2 launch vehicle to place the remains in a 1,900-mile high circular orbit. This orbit, which is within the Van Allen belt, was chosen so as to minimize the orbital debris risk to other satellites. The radiation in the Van Allen belt is severe enough to damage electronics so it is an orbital altitude not normally used. It also is a high enough orbit to eliminate reentry concerns. The spacecraft is expected to remain in orbit for 63 million years. 3.10.5.5.2 Ground Segment
The ground segment of a space burial enterprise should only consist of a facility for receiving cremains, processing, storing, and encapsulating them in the spacecraft. Normal cremation reduces the human body to 3 to 4 pounds of ash, too much weight and volume for the number of cremains required for each launch. Celestis developed a technique to recremate the ashes, significantly reducing the weight and volume so that they can be packed into a 5/8-inch diameter by 2-inch long capsule. 3.10.5.5.3 User/Transportation Interfaces
Technically, ashes are probably the easiest payload one can imagine to launch into space. They don't require any power, telemetry, cooling or heating, electromagnetic or acoustic shielding, clean room installation, or final inspection. The only structural requirement is that the capsule doesn't melt or burst during ascent. In a dedicated mission, internal packaging could completely collapse and it wouldn't effect mission success.3.10.5.5.4 Management and Policy
The issue that kept Celestis from actually offering this service on a nationwide basis was not a technical or marketing problem, but a Florida state law that governed the local funeral industry. That law forces any company selling future burial contracts to place the money in a trust with a very limited percentage allowed for operating expenses prior to the actual burial. This works for a cemetery that only requires minor grounds keeping but limits access to rocket launch providers who want and need money up front. 3.10.5.5.5 Improvements Over Current
Space burial is a commercial venture that can be done by almost every existing launch vehicle. The difficulty is not technical, but is primarily a matter of public image. The organizations that control the world's launch vehicles strive to impress potential customers and/or the general public with their technical genius. They do not want to risk public ridicule by agreeing to launch human remains without the assurance that it will be very profitable. 3.10.5.6 Business Opportunities
Business opportunities for space have always been based on delivering one, or a very few, high value payloads on each launch. The payloads are fragile and expensive machinery that have to survive the very extreme environment of space, perform a usually complex operation, and then transmit information about that function back to earth. A space burial payload has the exact opposite characteristics. 3.10.5.6.1 Cost Sensitivities
Figure 3.10.5.6-1 is an estimate by Celestis as to how cost might affect the market. The chart indicates that there is significant interest at current launch costs. Any reduction should create additional interest. The rapid increase in mass delivered as cost per pound is reduced by two orders of magnitude assumes that a large part of the market would want a larger amount of ashes or even DNA samples sent into space.
Current launch costs per pound are so high that any reasonably priced space burial requires that a normal 3 to 4 pound set of cremains be divided up or recremated to a much smaller mass. Celestis believes that this additional reduction of a loved ones remains is distasteful to some potential customers. If the cost per pound into orbit is reduced by two orders of magnitude, recremation would not be required for every customer. It is estimated that this option would double the market for space burial. 3.10.5.6.2 Programmatics
There is no fixed schedule necessary to make this market viable. When it becomes easily available and a few missions prove that it is relatively reliable, it should become a self-perpetuating industry. To take advantage of the free worldwide publicity that a successful mission will generate, a system for taking orders and processing ashes promptly needs to be in place before the first launch. Advertising will be necessary to inform potential customers of the availability of the service and how it works. 3.10.5.7 Conclusions and Recommendations
Recorded public response to just the concept of space burial seems to indicate that there is a significant market for this service in the industrialized world. The technical difficulties are almost insignificant if a reliable launch system is available. The legal and logistical difficulties should be easy to overcome if a major space organization decides to pursue and/or endorse the business. The most difficult part will be to get that initial endorsement prior to going public and taking paid orders.
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3.10 Advertising
3.10.1 Introduction
3.10.4 Space Product Demonstration
3.10.2 Novelties
3.10.2.1 Introduction/Statement of Problem
3.10.3 Space Advertisement/Orbiting Billboards
3.10.2.2 Study Approach
3.10.2.3 Market Description
3.10.2.3.1 Market Evaluation
3.10.2.4 Prospective Users
3.10.2.3.2 Space Application Description
3.10.2.3.3 Market Assessment
3.10.2.3.4 Infrastructure
3.10.2.5 CSTS Needs and Attributes
3.10.2.5.1 Transportation System Characteristics
3.10.2.6 Business Opportunities
3.10.2.5.2 Ground Segment
3.10.2.5.3 User/Transportation Interfaces
3.10.2.5.4 Management and Policy
3.10.2.5.5 Improvements Over Current
3.10.2.7 Conclusions and Recommendations
3.10.3.1 Introduction/Statement of Problem
3.10.3.7 Conclusions and Recommendations
3.10.3.2 Study Approach
3.10.3.3 Market Description
3.10.3.3.1 Market Evaluation
3.10.3.4 Prospective Users
3.10.3.3.2 Space Application Description
3.10.3.3.3 Market Assessment
3.10.3.3.4 Infrastructure
3.10.3.5 CSTS Needs and Attributes
3.10.3.5.1 Transportation System Characteristics
3.10.3.6 Business Opportunities
3.10.3.5.2 Ground Segment
3.10.3.5.3 User/Transportation Interfaces
3.10.3.5.5 Improvements Over Current
3.10.3.6.1 Cost Sensitivities
3.10.3.6.2 Programmatics
3.10.4.1 Introduction/Statement of Problem
3.10.5 Space Burial
3.10.4.2 Study Approach
3.10.4.3 Market Description
3.10.4.3.1 Market Evaluation
3.10.4.4 Prospective Users
3.10.4.3.2 Space Application Description
3.10.4.3.3 Market Assessment
3.10.4.3.4 Infrastructure
3.10.4.5 CSTS Needs and Attributes
3.10.4.5.1 Transportation System Characteristics
3.10.4.6 Business Opportunities
3.10.4.5.2 Ground Segment
3.10.4.5.3 User/Transportation Interfaces
3.10.4.5.4 Management and Policy
3.10.4.5.5 Improvements Over Current
3.10.4.7 Conclusions and Recommendations
3.10.5.1 Introduction/Statement of Problem
3.10.5.2 Study Approach
3.10.5.3 Market Description
3.10.5.4 Prospective Users
3.10.5.5 CSTS Needs and Attributes
3.10.5.5.1 Transportation System Characteristics
3.10.5.6 Business Opportunities
3.10.5.5.2 Ground Segment
3.10.5.5.3 User/Transportation Interfaces
3.10.5.5.4 Management and Policy
3.10.5.5.5 Improvements Over Current
3.10.5.7 Conclusions and Recommendations
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