
The Business Model of SpaceX Is Quintessentially American Fraud - daliwali
https://dissention.wordpress.com/2017/06/06/the-business-model-of-spacex-is-a-quintessentially-american-fraud/
======
atonse
Interesting points, but this is sort of a ridiculous statement: "it has not
really invented or discovered anything more innovative than making the lower
stages of their rockets land vertically", this is a sign that these first-
stage launches have become so routine, that now people just hand-wave and say
"so what?"

But I do think there's a lot to the author's point #4:

"Even if we assume that SpaceX is actually cost competitive, who will use
their launch services? Here is a hint- almost nobody outside the USA. Here is
why.. Countries such as Russia, China, India and Japan are going to use their
own launch systems for a number of reasons such as ensuring national security,
keeping their own scientists and engineers employed and maintaining national
pride. Also, vertical integration of spacecraft and launcher programs create
far more cost savings than using somebody else to launch your spacecraft using
slightly cheaper launchers.Even European countries are unlikely to use SpaceX
over their own ESA launch systems- even if they are a bit more expensive
because it is about technology, jobs and security. Furthermore, countries
other than those listed above are also unlikely to use SpaceX since countries
like China already offer very competitive packages covering everything from
satellite design and launch to post-launch support."

The government based space missions across the world won't use SpaceX because
of all those reasons. Cost doesn't matter to them.

NASA will use SpaceX because it's an American company.

~~~
Denzel
Sure, the government based space missions won't use SpaceX. That's a non-
issue.

SpaceX's launch manifest is filled with ~70% commercial customers anyways from
the likes of: France, Japan, China, Canada, Bulgaria, Luxembourg, and
Malaysia.

They're eating commercial launches for breakfast and putting huge pressure on
Arianespace, ILS, and ULA. And they haven't even begun to reap the full cost
savings of reusable rockets.

No one will be able to compete with SpaceX once they achieve full reusablility
with Block 5. Their costs to launch will go down by 90% (10x cost reduction):
meaning that SpaceX can respond to any competitors' price reductions
instantaneously ... while stacking huge amounts of cash, on fantastic margins,
as everyone else tries to catch up.

~~~
babyrainbow
>No one will be able to compete with SpaceX once they achieve full
reusablility with Block 5. Their costs to launch will go down by 90% (10x cost
reduction): meaning that SpaceX can respond to any competitors' price
reductions instantaneously ... while stacking huge amounts of cash, on
fantastic margins, as everyone else tries to catch up.

How will a couple of blown rockets affect this plan?

~~~
Denzel
Time will show whether that happens, no?

SpaceX has been methodically derisking.

We're 10 days out from the 2nd launch and landing of a previously flown Block
3 rocket. Their 1st relaunch and landing ended with a happy customer.
Customers seem to have no problem lining up for reusable rockets already.

~~~
babyrainbow
>Time will show whether that happen

Why not wait till that before getting all hyped up. Isn't this exactly what
the article criticizes?

~~~
Denzel
They've already made historical accomplishments several times over. To each
their own hype.

------
drucik
I'm not a 'rocket scientist', but this article seems as if the person who
wrote it is neither and most of the arguments tend to feel like arguments from
ignorance - 'I don't get it so it must be scam'.

------
jakozaur
It's hate driven article, which is not factual correct.

1\. SpaceX proves rockets can be reused and have huge cost advantage.

2\. SpaceX missions have a lot of non-USA payload. E.g.: "BulgariaSat 1" on
June 15: [https://spaceflightnow.com/launch-
schedule/](https://spaceflightnow.com/launch-schedule/)

3\. USA has no capability of launching astronauts into space without SpaceX.

------
babyrainbow
Very interesting, and I would say "brave" article, to be submitted to HN!

Something I have often wondered and curious what the spacex's solution is to
this

>But why? Why did countries like the ex-USSR which made them in tens of
thousands prefer to use new engines than use ones they knew could be reused.
Well.. it comes down to a cost and risk calculation. Rocket engines, even the
most simplified and robust ones, are always one tiny defect away from blowing
up. It is easier to be certain about the lack of tiny but fatal defects in a
newly built engine than a refurbished one. Moreover the cost of a refurbished
engine blowing up once in a while exceeds the cost of using freshly built
engines. Also refurbishing and testing used engines can get almost as
expensive as building new ones from scratch.

Also, no wonder this is getting downvoted considering how the article ends....

>My point is that SpaceX is bluffing and lying when it claims the ability to
“disrupt” the space launch business or become the dominant global player in
that sector. What is especially sad to see is the number of otherwise
intelligent people who are willing to treat the press releases of that company
as holy gospel. Then again the USA is full of self-delusional types who are
confident of becoming multi-millionaires within the next decade. To summarize,
the long-term (and even medium-term) business model of SpaceX is a confidence
scam based on rosy and polished presentations combined with exhortations to
positive thinking. And that is why I called it a quintessentially american
fraud.

------
BetaCygni
> ...it has not really invented or discovered anything more innovative than
> making the lower stages of their rockets land vertically...

Which is innovative enough for me. Cheap reusable rockets have been the holy
grail of spaceflight for a long time.

There is still a lot to be done, but the current pace is high. I'm optimistic.

