Tech billionaires are fighting for their space escapes – but who really pays for their trips?
Billions of dollars fueled by the pandemic enabled Blue Origin’s suborbital travel on Tuesday, spaceflight company founder Jeff Bezos admitted at a press conference.
“I want to thank every Amazon employee and every Amazon customer – because you paid for it all,” said Bezos, founder and former CEO of Amazon, after the trip, which launched four civilians, including itself, in space in 11 minutes. stroll.
Bezos’ fortune, which he uses to fund Blue Origin, increased by $ 86 billion during the coronavirus pandemic, making him the first person in modern history to be worth more than $ 200 billion, according to estimates by Forbes. Shares of Amazon and other companies that made it possible to live and work “at home” during lockdowns – like Slack, Zoom, and Peloton – have exploded as remote working takes off and home delivery of food and consumer goods increased, propelling the fortunes of founders and rulers.
Bezos has invested around $ 7.5 billion in Blue Origin since its inception in 2000, according to estimates, mostly by selling Amazon shares. He owns about 10 percent of the company and is the largest shareholder. From toilet paper to bananas to baby wipes, every Amazon package was another drop of fuel in the rocket tank, another point in space suits.
Bezos said he believes pushing into space will help humanity solve some down-to-earth problems. It is important to “look to the future … as a species and as a civilization,” he told CNN this week. Working in space “will solve the problems here on Earth,” he said.
But while space travel is touted as a solution to the woes of this world, don’t yet expect hundreds of passengers a year. For now, it remains limited to the billionaire boys club.
“Space tourism will always be a niche business, in my opinion,” Phil Smith, space industry analyst for BryceTech, a space industry research and consultancy firm, said by email.
Space tourism could bring in around $ 1 billion in total revenue over 10 years, based on current demand and research budgets, Smith said.
“The suborbital space tourism industry has started – this is the first year for this market,” he said.
John Logsdon, professor emeritus at the Elliott School of International Affairs at George Washington University and longtime director of the school’s Space Policy Institute, said: “As the two companies gain strength experience, the price of a flight is likely to come down, but not by a general point of affordability. “
Blue Origin said it already has two revenue passengers scheduled for later this year; he did not disclose their identity or the price of the tickets. Bezos said the service is already approaching $ 100 million in private sales and demand is “very high.”
Rival Virgin Galactic, which sent founder Richard Branson to the edge of space just nine days before Bezos, has already reported 600 active bookings, with each ticket selling for between $ 200,000 and $ 250,000. Its first flights are expected to take off early next year. Elon Musk’s SpaceX wants to take passengers on million dollar lunar rides and says it is running for 2024.
As with a lot of things in tech, what can really be at stake are data, lucrative government contracts, and business applications.
Amazon and Blue Origin are separate companies with a common founder. And while sales of Amazon shares have funded Blue Origin, the e-commerce giant does not derive any direct financial benefit from rocket travel.
However, they give Amazon investors a new growth story to hang on to. That and the PR and media publicity gained are some of the perks. Amazon shares edged up Tuesday after Blue Origin’s high-profile trip.
The flights are basically high-profile announcements that companies are in the rocket business – and each flight provides data for the next flight.
“The goal is to train,” Bezos said at Tuesday’s post-flight press conference. He said the rocket’s liquid hydrogen fuel, the most powerful form of rocket fuel, was “excessive for space tourism.”
Bezos also said that Blue Origin is focusing on research and development for its New Glenn rockets, which instead of carrying a handful of observers from space, can go into orbit and carry payloads of up to 15 tons. According to the Blue Origin website, potential markets include “civil, commercial and national security customers.”
Smith said: “Such launches indeed represent opportunities to gain experience with reusable space vehicles in order to build reliable and efficient space transportation systems. The aim is for the commercial sector to reliably provide services to the public, as well as to governments. , from telecommunications and remote sensing to freight and crew transport. “
The first launch of New Glenn is scheduled for the last quarter of next year.