Boeing Sets Lofty Goals For Space Project Aerospace Giant To Compete In Market For Launching Commercial Satellites

The Challenger explosion in 1986 was more than a blow to U.S. space exploration.

Grounding the space shuttle program also took the United States out of the business of launching commercial satellites for more than a year. Customers who wanted to get their commercial payloads into orbit were forced to look elsewhere, and found the Europeans quite willing to help out.

Result: The United States lost its cutting edge in the space transportation field.

Now, nearly a decade later, Boeing wants to get it back with Sea Launch, a new venture to send satellites into space from a sea-based platform somewhere in the Pacific Ocean.

“Our aim is to realize a fair profit, while restoring U.S. leadership in the commercial launch marketplace,” said Jim Noblitt, president of the Boeing Commercial Space Co.

Earlier this month, Boeing announced it has been working for more than a year to create an international industrial team that includes Russian and Ukrainian rocket builders and a Norwegian shipbuilder so it can begin launching commercial satellites by 1998.

At one of Boeing’s many office buildings in Renton, Wash., two dozen engineers have been developing a system the company says will make it a low-cost provider of launch services in a market worth $1 billion to $1.5 billion annually.

Eventually, the company will employ about 100 people in the Puget Sound area and establish a home port somewhere on the West Coast for a total U.S. work force of about 200.

The venture would give Boeing, already the prime contractor on the international space station Alpha, an even stronger position in the space transportation business, they said.

Its plans show Boeing is going directly after Arianespace, the European launch consortium of 40 companies led by Aerospatiale, the French partner in Airbus Industrie, Boeing’s archrival in the commercial aviation industry.

Arianespace has about 55 percent of the world’s launch contracts, while Lockheed-Martin and McDonnell Douglas, Boeing’s other commercial avia tion competitor, together have less than 30 percent. Launchers in Russia, China and Japan share the rest of the pie.

Used to launch military satellites, operations in the United States, Russia and China often are inefficient, requiring as many as 500 workers to get a rocket into space. The rockets themselves are Cold War models built in the 1950s and 1960s for ballistic missiles.

Much like Arianespace, Boeing wants to be leaner, more modern and more sensitive to the needs of commercial customers.

“We’re in better shape to compete with Arianespace,” Boeing spokesman Elliott Pulham said.

Norway’s Kvaerner Group, one of Boeing’s partners, is negotiating the purchase of a self-propelled oildrilling platform, which the venture will refurbish as a seagoing launch pad. Kvaerner, one of the world’s largest shipbuilders, is also finishing up the design on a new assembly, command and control ship.

Launching from sea has its advantages, industry insiders said. It avoids a lot of environmental concerns, cuts the maintenance cost of a fixed launch site and provides flexibility for the timing of a launch.

But weather conditions can be a challenge for sea-based operations, and saltwater corrosion can play havoc on the rocket or its payload, insiders said.

“Electronic equipment does not like corrosion,” said an engineer at one of Boeing’s U.S. competitors. “You’ve got a lot of other unknowns at sea.”

Boeing and the other members of the industrial team would use only about 100 technicians to load, prepare and launch rockets of recent design.

The booster rockets and upperstage systems supplied by Boeing’s other two partners, RSC-Energia of Russia and NPO-Yuzhnoye of Ukraine, were developed during the 1980s, when the Soviet Union felt threatened by talk of the Star Wars defense program and wanted to be able to replace their satellites quickly.

Launching from a platform near the equator will cut the cost of getting geosynchronous satellites into orbit, an energy savings that will allow Boeing’s customers to increase payload by 10 to 20 percent.

But Arianespace also has efficient launch operations, which require about 200 workers and use Ariane 5 rockets, a fifth-generation design developed recently with a $7 billion European investment.

And the French-led consortium launches its rockets from the South American country of French Guiana, very close to the equator.

So, even with its perceived cost advantages, Boeing may have a tough time competing with the Europeans, industry observers and space experts say, particularly because Arianespace is governmentsubsidized.

Further, John Pike, director of the space policy project for the Federation of American Scientists in Washington, D.C., doubts there’s really enough business out there.

“There are too many rockets chasing too few satellites for the geostationary market,” he said.

Boeing officials disagree, saying 900 applications have been filed with the International Telecommunications Union in Geneva for future “parking spaces in orbit.”

“There are a lot more satellites ready to be launched than there are launch services available to take them up,” said Allen Ashby, vice president of business development at the Boeing Commercial Space Co.

“Boeing is going to make money with it,” Ashby predicted.

In addition, a lot of existing satellites will need to be replaced, says Bill Whitlow, an analyst with Pacific Crest Securities in Seattle. “I think it (the market) has a lot of potential and it makes a lot of sense for Boeing.”

Although Boeing hasn’t signed up any customers yet, Noblitt said interest in Sea Launch has been “very strong and very encouraging.”

That could be true if Boeing is also aiming for telecommunications customers with smaller satellites in lower orbits, Pike said.

Boeing acknowledged last week that it has talked with potential customers other than big satellite makers.

Teledesic, founded by high-tech billionaires Bill Gates and Craig McCaw, is one of them, Ashby said. Teledesic’s plans include the launch of nearly 900 low-orbit satellites beginning in 1999, according to Russell Daggatt, Teledesic’s president.

The idea is to transmit digital data at speeds competitive with advanced fiber-optic networks that form the backbone of the planned information superhighway.

“There is a fundamental evolution taking place in space-based communications from larger, powerful satellites to smaller, loworbit satellites,” Daggatt said.

“Boeing is a good customer to do business with,” he said. “We’re very bullish on the demand for launch services. I don’t think Teledesic will be the last system of its kind.”