Virgin Orbit’s Dan Hart. Credit: Euroconsult

PARIS — The per-kilogram cost of launching small satellites is dropping — now $5,000 from SpaceX, $8,000 from Relativity Space, $12,000 from GK Launch Services and coming down at Europe’s Vega and the PSLV from ISRO of India.

How far they can go before an already difficult business becomes untenable for its most-exposed players, the dedicated-launch small rockets? We’ll find out.

For now, those whose prices started out way higher than the current levels are stressing their added-value services.

This is the core argument for the small rockets: We can take customers’ satellites exactly to the requested orbit, and there’s no risk of waiting for months for a larger rocket’s main payload to be ready. There are no primary and secondary customers. That’s worth something to smallsat owners.

“We have always known that there can be ride shares on a large rocket,” said Dan Hart, chief executive of Virgin Orbit, whose apparent prices are far higher than those quoted above. “If you can wait for the rest of the payloads, and that’s your business plan, that can be an attractive thing to do.”

Virgin Orbit’s small rocket, carried under the wing of a customized Boeing 747 jet, is scheduled to make its first orbital flight before the end of the year.

The company’s biggest early customer, the OneWeb constellation of broadband satellites, has said Virgin Orbit’s prices, at $6 million for a 150-kilogram OneWeb satellite to 1,200 kilometers, were 2-3 times the prevailing rate:

Attending Euroconsult’s World Space Business Week here Sept. 9-13, Hart did not specify Virgin Orbit’s pricing flexibility, focusing instead on Virgin Orbit’s service.

“The question is: What is the total value of a launch?” Hart said. “The ability to get to the right orbit, on time, with schedule assurance, being focused on a customer — these are important to this growing [smallsat] community.”

Maybe so, but most other smallsat launch operators were spooked by SpaceX’s recent price reduction, to $5,000 per kilogram for sun-synchronous and mid-latitude low Earth orbits.

SpaceX: $5,000 per kg, monthly launches to LEO

The company’s Smallsat RideShare Program will change $1 million for a 200-kilogram payload and $5,000 for each kilogram beyond that.

These launches will be mainly with SpaceX’s Starlink broadband satellites operating at 550 kilometers in altitude. The service starts in March 2020, with monthly launches for the rest of the year. In 2021, SpaceX has advertised 17 launch opportunities for the service.

Can’t make the launch? SpaceX says it will apply your downpayment to a future flight, no questions asked, but you must pay a 10% rebooking fee.

SpaceX President Gwynne Shotwell presented the company’s smallsat pricing policy as almost a charitable exercise by SpaceX, and also an investment in companies that may one day be substantial customers.

“The small and micro satellite industry is all of our future customers,” Shotwell said. “We did reduce the cost of our ride-share program, largely because we thought the cubesat market needed a much-reduced price as well.”

That said, Shotwell has been consistent in saying that dedicated smallsat launchers, like SpaceX’s abandoned Falcon 1, have challenging business cases.

“We could not make Falcon 1 work,” Shotwell said. “I certainly wish them luck but it’s a rough market. It costs a lot of money just to get a tennis ball to orbit. The smallsat guys have a hard time spending money on launch when [they] are covering the entire vehicle. So I am a little bearish on the small launcher market. I was there.”

Industry officials questioned whether SpaceX’s smallsat service is sustainable beyond the large Starlink constellation. But even these officials acknowledged that they could not ignore its impact in the next 2-3 years.

Mario Fragnito, Arianespace VP for Vega. Credit: Euroconsult

“If some player starts to dump prices, we are obliged to follow them,” said Marino Fragnito, vice president for the Vega program at launch-service provider Arianespace. “We cannot stay at our level of pricing when somebody else is dropping prices on the market — which I think is not good for the community. But of course, it is good for the customer.”

Vega has relied mainly on government customs for its first 15 flights, meaning it has been somewhat insulated from the pricing pressure of the commercial market. But that will change. Fragnito said Vega’s return-to-flight mission in early 2020 — the vehicle’s 15th mission, in July, ended in failure — will be of the Vega Small Satellite Mission Service, SSMS, which will carry 42 passengers.

Fragnito said the Vega team is working to cut costs where it can. It has created a cubesat launch-integration facility in the Czech Republic to save costs over the existing installations at Europe’s Guiana Space Center in French Guiana, Europe’s spaceport, on the northeast coast of South America.

“The customers will come to Arianespace and Vega because they want schedule reliability, a reliable launcher and a good service,” Fragnito said.

Soyuz from GK Launch Services: Prices to drop with removal of Fregat upper stage

GK Launch Services of Moscow has been given authorization by the Russian government to market Soyuz launches outside of Russian territory.

Alexander Serkin, the company’s chief executive, said the Soyuz 2.1-b variant, without the Fregat upper stage, will cut costs and allow GK Launch Services to lower its prices.

“We are targeting $30 million to $33 million for this version of the rocket, so 2-3 [metric tonnes] to SSO,” Serkin said. “That should allow us to bring prices below $15,000 per kilogram when it comes to micro satellites. Price is not the only factor, but it is one of the most important ones.”

Relativity Space CEO Tim Ellis. Credit: Euroconsult

Startup Relativity Space has scheduled the first launches of its 3D-printed vehicle in 2020, with commercial flights with Spaceflight Industries and Momentus in 2021. The company has announced prices of less than $8,000 per kilogram.

Relativity Space Chief Executive Tim Ellis acknowledged that larger rockets can offer lower prices than dedicated smaller vehicles for lots of smallsats riding on a single launch. But the smaller vehicles have their own arguments.

“There are definitely advantage to being on a dedicated launch over one having tons of satellites on a large rocket,” Ellis said. “But that will only get us so far. We just need to be sure we are not orders of magnitude away from that [SpaceX-level] pricing. We are quite confident.”