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SpaceX Has Finally Won a National Security Contract

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SpaceX has been making good money sending all sorts of non-classified things into space, and has also been making some fantastic highlight reels of the crashes on return. But things have taken a turn for the serious now that SpaceX has won its first contract for a military launch.

The $82.7 million contract to send a US Air Force GPS satellite into orbit is a big deal, and not just because that’s a bunch of dough for SpaceX. It breaks the monopoly that the United Launch Alliance, a Boeing-Lockheed joint venture, has had on National Security Space (NSS) contracts for the last decade.

As your economics prof used to remind you, monopoly bad, competition good. Specifically, competition is good for driving down the cost of sending stuff to space. SpaceX has proven this point rather emphatically, because an Air Force spokesperson told reporters that “the awarded price for this mission is about 40 percent cheaper than (the) government estimate for previous missions.”


The competition from SpaceX is already forcing the ULA to step up its game, overhauling the rocket fleet and cutting costs—exactly what you expect from a monopolist suddenly forced to compete.


And yes, cheap(er) rockets is good news for people other than the Air Force. Getting stuff into space is easily the most expensive part of space travel—bring those costs down far enough, and a journey to Mars starts looking all kinds of feasible.