Elon Musk's SpaceX successfully launched the Falcon Heavy rocket on Tuesday. Before SpaceX, launching rockets was often seen as something that had to be done by government; even nowadays, there are some critiques about SpaceX and its several launching failures (the failed deployment of a spy satellite on January 7th is the most recent one). SpaceX's success is huge that it shows there is a possibility for individuals to start space businesses.
Why did no one start their space businesses? This is in many people's mind, the space businesses including rocket launching are too risky. This is still true. Even though Elon Musk has significantly lowered the costs, the entry bar is still very high in this industry. Moreover, the probability of failure is relatively high that SpaceX is relatively experienced, but it still can fail to deploy satellites. More importantly, in this industry, if a company fails, it loses every single penny. However, with the help from the insurance industry, such risk could be reduced by buying insurance but the premium it has to pay is much higher than in other industries.
If Elon Musk's SpaceX can carry on, it sets an example for everyone else that this is a profitable sector with a bright future. His success may indicate in the space industry, the profits could overcome the costs and the risk taken by the companies. This could potentially encourage more companies to enter this industry. When more people work in this industry, there will be more innovations and what we can get from this industry may be something we never think of at the moment.
No comments:
Post a Comment