Question

F5: Market Structure

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This covers Chapter 13 and 14.

The National Atmospheric and Space Administration (NASA) is ending its space shuttle program, but has developed programs to encourage firms to enter the market for space flight. Once the shuttle is ended, the market will be monopolized by the Russian Space Agency, which charges a monopoly price of $47 million per astronaut for a trip to the International Space Station.

Under its C3PO (Commercial Crew & Cargo Program), NASA is investing financial and technical resources to stimulate efforts within the private sector to develop and demonstrate safe, reliable, and cost-effective space transportation capabilities.

If NASA is successful, in what ways will this effort change the Space Transportation market?

IT MUST BE AT LEAST 250 WORDS

Answer 1

NASA is making sustained progress toward acquiring commercial crew transportation services. For example, in 2009 the Agency initiated the Commercial Crew Development effort to focus on developing systems and concepts that will help establish an industry capable of transporting astronauts to low Earth orbit and the Space Station. The following year, NASA awarded $50 million in funded Space Act Agreements to encourage the development of system concepts and capabilities that could enable commercial crew transportation services. In April 2011, the Agency announced a second round of CCDev awards totaling $269.3 million to accelerate the availability of U.S. commercial crew transportation capabilities. However, even with the additional funding planned, NASA faces multiple challenges and risks as it expands its Commercial Crew Transportation program.

Consistent with the principles, the primary purpose of CCDev is to stimulate the private sector and aid in the development of commercial human spaceflight capabilities that NASA could use to transport astronauts to low Earth orbit and the Space Station. As one potential customer of this private sector market, NASA expects the CCDev Space Act Agreements to result in commercial capabilities that consider the Agency’s Certification Requirements. The other side of the question of US space transportation appears more positive. The Space Shuttle will not be replicated but its missions of transporting crew and supplies to the ISS are being assumed by NASA-funded commercial space lift options. For all the criticism of NASA, the cargo portion of its effort, embodied in the Commercial Resupply Services (CRS) program, has worked despite some delays and the first in-flight loss of a supply mission.