Transcripts For CSPAN3 Space Commerce Forum Part 1 20240713

Good morning, and welcome to the u. S. Chamber of commerce and to launch, the space economy, our Second Annual space summit. Events such as this are a team effort and we deeply appreciate the support of our sponsors, boeing, northrop, rocket lab, oneweb, hawkeye 360, and ascend. We have been businessy over the past year. From policy discussions ranging from management of commercial aviation and space launch airspace, to small satellite encryption and deorbit insurance and commercial opportunities aboard the iss and future gateway. We even convened a roundtable with a commandant of the u. S. Coast guard regarding the need of greater use of spaceenabled surveillance of the arctic waterways. Suffice to say the chambers procurement and Space Industry Council has an everexpanding set of policy pursuits. Fortunately, we have an enthusiastic space industry ceo here at the chamber. After last years summit tom donahue bro an articwrote an ar which i will quote. He wrote, harnessing the economic potential of space will be no easy feat. It took hundreds of years to create an efficient and wellregulated maritime system and nearly a century for aviation but, he added, they with both vital parts of the Global Economy and space increasingly is, too. Indeed, he wrote, space is the new economic frontier. The public and private sectors must Work Together as partners and pioneers to leverage its vast potential for humankind. Im not sure that it can be said any better. But before i introduce this ceo of the u. S. Chamber, we have a brief video that i think you will like. If we could roll that now. Greetings from the International Space station. Im nasa astronaut christina cook. On behalf of the expedition 61 crew, we would like to welcome the attendees of the 2019 space summit aboard our magnificent laboratory. We are appreciative of the u. S. Chambers support and commitment to enabling commercial partnerships and Strategic Investments especially in the space industry. As we fly 255 miles above you, we are making great progress on a number of experiments. For example, examining how microgravity can improve the health of people on earth. We expect this trend to continue as we approach the 20th continuous year of humans living and working aboard the space station. While we couldnt join you in person, were happy to have joined you today from orbit and wish you all a productive space summit. And with that, tom donohue, ceo of the u. S. Chamber of commerce. [ applause ] you guys in a few minutes, im going to go out to the airport and on a horizontal basis, im going to fly about 250 miles, and its unbelievable to think that you just saw a quick video from space and people are telling me that you aint seen nothing yet. So im glad youre all here. Christian, you and your team have put together a great event. Thanks to all the folks on the space station for tuning in with us for a few minutes. Its great for us to see so much commercial work under way on the International Space station. Truly, a jewel in the crown of a cuttingedge research youre going to see as we go forward. Id also like to thank all of you who are joining us today, whether as a speaker, a panelist, a participant, or whatever youre doing, its just great to have you here again or anew. Let me just make one observation. I went through all the programs this morning on the way here and i was really taken back by the extraordinary number of and quality of speakers that were going to have today. If you just look carefully at that whole agenda of whos going to be here, there is no question that were on our way to space in a huge way. This years summit is appropriately titled, launch the space economy. The name perfectly describes where the industry is headed. In recent years, we witnessed a s sea change in special space. Were officially moved beyond the countdown to the point of liftoff. Think of this. Today, there are less than 2,000 active satellites in orbit, but last year, alone, the fcc licensed over 13,000 satellites for operations in lowearth orbit. Space is the most promising industry to arise since the birth of the tech sector and Companies Large and small want a piece of the action. Thats why in the coming years growth will continue to skyrocket. The u. S. Chamber projects that commercial space will be at least a 1. 5 trillion industry by 2040, and if there are stimulus from competing operations around the globe, that will happen faster, in a competitive way, and a much more vigorous investment. If that doesnt give you a pause, then you aint paying attention. The future of our economy is being built right before your eyes, and it is poised to upend everything that came before. Commercial space will transform how all societies across the globe learn, communicate, thrive, and grow, and thats only using space hundreds of miles above us. If you just think, if you just think back in the last six months the things weve learned, the things weve read, the things weve seen, on what were finding, new black holes, extraordinary deeper into the space and the next space and the next space. Its unbelievable and i want to say, again, what youre watching and what were working on is only the beginning and as soon as we get one place, were going on further. Commercial space is something that stimulates the mind and has a Great Potential to fundamentally change our education system. All civilizations throughout history look to the heavens and wonder and they pray. Now we have the chance to reach up and grasp those dreams and the opportunities are endless. Space isnt an empty void, but it is a landscape of near infinite opportunity. The materials and the Energy Resources that are scarce here on earth are everywhere in our solar system. Lunar colonies, astronaut, mining, and interplanetary travel, once the stuff of Science Fictions could soon become a reality. But for that to happen, we need sensible Public Policies that will foster the innovation in, investment, and growth necessary for continued commercial expansion into space. Thats where the chamber comes in in our small way. Were working with all the private and Public Sector stakeholders to chart the course toward a mature commercial space Regulatory Regime. Thats the reason we brought you all here today. Its you, our nations business leaders, policy experts, and government officials who are laying the groundwork for a new age in Space Exploration. Were eager to hear from both government and industry this morning as you Work Together to build a National Space policy that will help us lead the world into the next economic frontier. The future of our economy depends upon vigorous pursuit of industry beyond earth. And with the right combination of private investment and Public Policy, our potential for growth, like space, itself, has no limits. So lets learn from each other today. Lets boldly venture into the beyond and lets go there together. And thanks to all of you, again, for joining us and for making this a very, very, important event, the next step to space. Thank you very much. [ applause ] please welcome jim chilton, Senior Vice President , space and launch, boeing defense, space, and security, at the boeing company. And neil bradley, executive Vice President and chief policy officer, the u. S. Chamber of commerce. Good morning. [ applause ] good morning. Well, jim, thanks for joining us this morning, helping us kick off our Second Annual space summit, our launch program. I wonder if we can just start kind of top line and tell us a little bit about boeings history in the Space Exploration and space program, which i know is, frankly, a lot richer than i certainly appreciated then maybe many in our audience appreciate and also how a little bit youre thinking about your priorities today. Okay. Well, one priority is to thank the chamber and all the people here. You and tom. This is a great event. I know it got a great start last year, so thank you for that. You know, kind of from a history and legacy perspective, a lot of people dont know, but boeing goes back a good 60 years in human spaceflight and about the same in satellites to include commercial satellites, so if you look at the legacy companies, we were part of mercury and gemini. Apollo, on both ends of the rocket, built devices. The lunar rovers were boeing products coming out of kent, washington. I know thats a long time ago, but it makes our workforce very proud. There are still technical papers and Lessons Learned there, so were able tointerested, as if the work doesnt do that. You know, if you look, i think the first commercial satellite rolled out of our factory in california, sencom 1 in 1962 maybe. I might be off a year there. Since then, satellites have been rolling out of what was an auto plant. If you look more recently, we had the privilege of serving nasa on the Space Shuttle program. Those orbiters are a marvel. If you havent gotten to a museum to see one of them, im a little biased because i got to work the program during my working life and those things enabled the Great Observatories and also enabled construction of the International Space station which people are familiar with. A huge amount of learning as our nation and partner nations on station, kind of ill call it conquered lowearth orbit. Maybe we didnt conquer it, but we sure learned a lot about it and the kids coming out of high school today do not know a time when humans havent lived continuously in space. So theres a new generation coming. Now, from our workforce standpoint, shuttle and station are very relevant. The shuttle Lessons Learned from our starliner product are huge. The i would argue nasas space station and the International Partners space station, that is the Human Space Program for our country and a lot of the world today. And we just keep learning. So the ability to learn how to human rate systems, the learning that comes off on orbit environments, kind of the crew ops, training, how fast you have to move when you get an unexpected event, that is just fantastic for our workforce. So, i wanted to start with the history because as i mentioned backstage, i was home in oklahoma with my family over the thanksgiving holiday. We went to the tulsa air and space museum, and some of those companies that are now part of the boeing corporation where some of those products that you just talked about were built in tulsa and some of the volunteer docents at that museum were the ones who helped design the payload doors, protection, on the Space Shuttle program and its amazing ksh not amazing remarkable the pride they take and work they did having been a part of putting americans into space and our space dominance at the time and how they translate that to even my 9yearold son in terms of what they can be a part of. I think sometimes we skip so quickly to the present were forgetting about how were building on that kind of legacy that rightfully people who you and people who preceded you have a deserved pride in what youve accomplished. So thanks for bringing that together and thanks for what boeing does, in particular, to help educate younger americans to kind of follow your footsteps. One of your colleagues who was with us last year is Chris Ferguson. For those of you who were here and joined us, chris was a nasa astrona astronaut, been in space, but hes currently no longer with nasa but he is training to go back to space and preparing to go back into space in a couple years. As part of Boeings Starliner program. Tell us a little bit about how you bring together the expertise of someone like chris has and his history in nasa, kind of the public side of Space Exploration and the expertise that you all have in the private sector side and how that marriage works and what kind of opportunities that creates as we think about how the u. S. Returns to human spaceflight. Yeah, thats a great perspective. I havent thought about both the public and internal part of it. Ill start by saying, you know, were working the commercial crew program. Our interest is something called the starliner. Really proud of it. Going to fly it. Were counting down days now, not months and weeks. How many days . I think were looking at the 19th. Okay. In fact, ill just disclose, we asked the range over the weekend. We were on the 17th. We asked for the 19th. And theyre they may have dispositioned that by now. I dont know. Thats what we prefer. We had something come up over the weekend on the purge ducting, the rocket feeds the spacecraft and the purge ducting was a little off, so we just told the team get it how you need to get it and well wait. So, number one, we call it the commercial crew program, but right now we are serving nasa and i need to just really thank nasa because a lot of what we know about human spaceflight, what boeing is able to do, we learned from nasa. You know, we served them for a long time. But were also bringing in a lot of techniques and approaches and were really doing this with much less nasa direct involvement than weve had in the past. And so having chris on the team is immensely valuable, in our view. You bring him into the team, you put a boeing badge on him, first off, he has an effect on all of us. You know, we all know these are very brave americans. These are also really smart people. So he has a great ability to lead other people. He has maybe too much ability to say, i could probably handle that risk, you know, but his his participation in those design trades and how are we actually going to operate this vehicle, has been invaluable and we think that has we just needed that inside the tent. I am in no way says the nasa aft astronauts are not able tole to in and participate in that way. Its been cool for chris to see how things work behind the curtain. To include our schedules and timelines and test protocols. So i think that has a good effect on both of us. That gets him able to very fairly represent the nasa in the quarters hes uniquely able to do. And, you know, ill close that question by just saying if youre an engineer entering the workforce or a technician that wants to build something just right, or youre off trying to work with other nations or individuals who may want to buy a commercial ride on this, the ability to go ask chris a question, or say, hey, what do you think about this or that, its honestly a thrill. Im glad hes not here because hed be mad at me for ill affirm that. Last year when he was here, i think i had lunch with him the day before and i walked in with naive questions for someone whos not in your line of work and his ability to walk through some of those things is a credit both to him but also i think to what hes learning with this kind of advent of how we go back into space. Right . Because the starliner is a lot different than for those who think about mercury, gemini, even the shuttle, this looks a lot different, feels a lot different. How has that transition been in terms of explaining to people boeings vision for what the commercial space crew experience looks like. So let me describe it as a composite. So, number one, the physics of carrying people safely to space, protecting them while theyre there and bringing them home safely to earth really havent changed and were not going to walk away from what weve learned. Safety first. I dont think anybody needs to hear us foot stomp that, but that fundamentally doesnt change. The Business Models very difficult. What were trying to do with the machines after we get flying for nasa is really very different. So when i say its a composite, you know, chris is an inspiring guy, but hes also a hardnosed test pilot. We have some pretty tough chief engineers and ops bosses who are going to build that thing right. At the same time, we know from our commercial airplane business and other commercial ventures were in the optics of how you sell it and how you might arrange the seats and be able to reconfigure them. Thats all much different than nasa, how we might be able to sell it and create value in the future. And thats a lot of fun for the team as well, but its got to be thought through carefully. So, thats where i wanted to go a little bit next, right, so the Current Administration has a renewed focus on Space Exploration, returning americans and american vehicles into space, but youre also thinking about it beyond that. Youre thinking about it from the commercial side of it. So talk to us a little bit about in the same way that you kind of combined the best of Chris Ferguson with the best of boeing, how do you marry up the administrations vision for what it wants to do in terms of Space Exploration and understanding that thats got to take place over multiple congresses and multiple administrations, with what boeing wants to do in terms of planning out a commercial enterpri enterprise. How do those things fit together . Are there opportunities that are presented . Are there conflicts . There are potential for conflicts. I think the first answer is its a great opportunity. I would remind everybody that, you you know, nasa has a policy objective. In addition to taking americans to space and others from u. S. Soil, which is job one, full stop, they also want to stimulate a lowearth orbit ecosystem. They want commercial companies to succeed. So the idea that we work for nasa, you know, we to some extent we have their policy blessing to try to fly these things but also use them for customers other than nasa. And you see them doing smart things with the International Space station environment to try to help us do that. So there could be a conflict. Hypothetical hypothetically, a customer could want to fly at the same time nasa does. What we experienced so far, theyre very open about its okay if you want to try to do that, do no harm to what were buying from you. I think nasa is enabling that much more than there would be any conflicts. Is this the Lesson Learned from going all the way back to, you know, kennedys challenge to put a man on the moon, that the government is leading and providing some incentives and obviously some funding, but the commercial spinoffs and opportunities that are created by that National Commitment maybe werent anticipated at the time and werent planned for but turned out to be very real and now we understand there needs to be those commercial spinoffs and opportunities and theyre part of the planning. Is thats what happened over the past 50 or 60 years . Well, lets see. Ill back up historically. Look at apollo, large by current standards, proportion of the gross domestic product, federal budget, however you want to measure it, it was high. Since then with maybe 10 of that annually, weve done Amazing Things. The big lesson in those Amazing Things is be ready for something you didnt expect. Some opportunity is going to arise. In our economy, thats kind of how it works so you want to scar your system to be able to go do great things. You want to partner with people who look at the world differently than you have, may be aware we partnered with virgin galactic, trying to see if we can be complementary as businesses. There are a host of other partners. But absolutely, you know, the government is an anchor customer, and it would be hard to get in this business if you didnt have a certain customer that knew this domain and could tolerate the risk. Its hard to even predict a schedule, frankly. Weve struggled a little bit with schedule. I think Everybody Knows that. But you have to do it right and have to do it systemically. So its absolutely an effective policy from my perspective and we wouldnt have a chance to go do the other things were going to try to do without that first nasa buy. So, we have the first nasa buy, we think a lot about the secondary and third and fourth iteration buys. And to your point, we dont know exactly what those are going to look like and we know to expect the unexpected, but from a business standpoint, you have to plan. You have to have some type of insight as to what you think the commercial opportunities are and, you know, obviously, here at the chamber, this conference, our conference a year ago, we talk a lot about the commercialization of space. And, you know, we throw out big numbers about what the opportunities are there. Right . And that involves a little bit of a little bit of science and a little bit of art. Right . You all have to do it much more heavily from a business perspective on the science of it. Give us your perspective in terms of how you see the future commercial opportunities of space and are we right to really talk about a new space age and a commercialization of space . I think were right. I think its hard. The numberone thing that gives me optimism is the quantity of new entrants and players. A lot of people can see themselves in this economy now and, you know, you can make the pro and con argument. I would say, id segment the markets for you a little bit if you want to talk about that. Freeze. T. Please. The launch markets are changing a lot. See small launchers and big launches and lots of them. Historically, there hasnt been room for as many as we see so the question will be, as we get more and more efficient, will elasticity happen, as you drop pri prices, will you get more demand . I think that experiment is under way. Any prediction . Launch is something nation states arent going to give up, so theres some subset of worldwide launches that can be commercial and people wont care what country it leaves from, and theres a subset that people are going to keep in their country so they dont lose the ability to do it and i think theres a finite amount of people that can survive in that commercial market and were seeing great competition. Were in it. Were super proud of our partnership and the people at ula that have, you know, people forget in the last 20 years it was can you really get rockets to work all the time . Well, theres a company thats proven, yeah, you can, ula. If you can do it reliably and get the price down, the question becomes, do you stimulate dem d demand . That question i think takes you to satellites first. Uhhuh. You know, the commercial satellite business has historically been a geobased business. Probably no one here needs a reminder that thats been a tough business the last few years. Orders have been doing. Were seeing a proliferation of nongeo. That will have implications for launch big and small. And moving away from kind of broadcast to Network Provision is see how that plays out. Some of those folks are going to start competing with the verizons and the orange, you know, got to have landing right out. Weve got to have landing rights in countries. Its exciting, but it wont be easy. But again, unintended or originally uncontemplated opportunities are probably going to come out of that. And human space flight, if we can crack open where people go to space that arent exclusively or almost exclusively government people, thats got to be good. You hear about the idea of obviously theres a lot of research that goes on in the International Space station, but you hear about a lot of opportunities to do cuttingedge research that can only be done in space or that would have benefits if done in space. Is that what the third Market Element of kind of nongovernmental human space flight unlocks . Its one of them. There are things, as great as robotics have advanced and computers are mighty handy, and they discover and notice things that maybe you wouldnt discover and notice. So i think thats true. I think much has been made about manufacturing in space. Thats possible. But were also discovering things, viruss mu tate in different ways, you can find discoveries for different things. Theres a segment of the market in my view which is tourism. Is that going to be a growing i dont know. Virgin galactic, congratulations to them. Theyre ready to Start Service with the short sub orbital rides. We aspire to provide some orbital rides. How deep that market is and what longterm environment could exist, were not sure. But were in. Is that another area where price elasticity and demand, we dont know where those two are going to meet on the curve . Im not sure were to that point yet. Were just with the early adopters, would you like to go and why. And after some people go, are a lot more people going to go or is it going to fade a little bit . I bet a lot of folks in this room would like to go. I think all of us in this room would vic to have the resources to be able to be one of those early adopters. So were thinking about how that price were interested in you can have a fifth seat or a cargo offering, if anybody wants to fill the fifth seat, just shoot me an email. Whats the going rate for Something Like that . Well talk. Exactly. It depends on the kind of Monthly Payment youre interested in. Its an installment system. This is something i havent heard yet. You mentioned a couple of times im really curious your perspective on this. Obviously the number of commercial players has multiplied and we dont know whether supply is going to exceed demand or demand is going to rise to meet supply. You obviously as we began the conversation, are a longterm player in this space. And perhaps more than many of the other folks who are peers and competitors in some sense today. You have a long timtime horiz look back from. Give us boeings ber expectiper the dynamic marketplace and the element that i would argue may be relatively new in terms of how we think about the commercial Space Services side. Thats a great observation, because i talk about legacy and our pride in products weve worked on. But the future is different. So number one, our view is its going to happen. Toms comments about the larger economy. Im not going to tell you the number the economy is going to be. But humans want to go there and theres obviously a lot of utility and excitement around going to space. So we believe in the economy emerging. Number two, its not going to happen in the traditional business mod lels that we can lk back and say weve been in. If you watch our behavior, the commercial is a different Business Model than the space station, which is different than the institutional models and launch system. If you look at our military satellite line, thats a lot of crossflow between commercial and military technology. And theres a flavor of commercial there. So number one, weve got to be acknowled agile in the Business Models and you cant get excited about that and get drawn into the wrong Business Model. In what way . So ill pick launch. People are very excited and this is kind of a personal observation. People are very excited about the launch business. I think someone like the chamber, theres more small sat launchers than Small Satellite Companies so you wonder is that a mismatch. And then you look and say how many rounds would you have to get through . And if all of you are going to succeed, is there that much money out there for this kind of investment . So you kind of have to pick your spot and predict which Business Model is going to work. Because theyre probably all capable of flying. Your business and these are harsh kind of business decisions. Is this where a little bit of the ro mamanticism, where you c take people and launch them into the heavens, is that where you have a little bit of a breakdown with the profit demands . Is there a little bit of that going on . I think theres a lot of that going on. Our ceo, he doesnt say i drank the koolaid, he says theres no blood left in the koolaid stream. So i talk about different Business Models and thats going to be as important as the technology. As more people are able to demonstrate the ability and technology, can you get into a sustainable business. Without revealing too much of how youre thinking at boeing, if launch is one of those areas where everybody is kind of getting in and everybody has kind of got their way of doing it, when you sit around, jim, and you personally think about this and youre like thats the area where in 20 years i said i wish i would have been, i want to be involved in, because the old ice hockey adage, you skate to where the puck is going, not where it is. Where is the puck going . Where would you like to see lots of people skating to . In launch specifically . No, beyond launch. Specifically beyond launch. So i think the prize ill say the prize of where they all want to arrive with the puck, weve had humans living continuously in space for going on 20 years and we dont want a gap in that. And im boldly we dont want it in the u. S. And i dont think we want it worldwide. So we have to go get this economy going. We have to go get these if the government says, hey, ive shown the world how to do it and now its over to the commercial sector to go get this done for the world, we have to do it or were going to have the gap. So thats one thing. So when you think about that gap, obviously we know the age of the International Space station, we know there are things that, with great engineering and ingenuity we can prolong time. You cant prolong an asset indefinitely. When do you think about that gap and you say, gosh, i hope were prepared as a nation to be at that point where we can fill that gap in 10 years, 15 years, 20 years . How do you think about the time horizon . I think youve got the time horizon about right, 10 to 15. And ill use government examples. Our congress looks like theyre going to extend the space station to 2030. Not a technical reason you couldnt do that. Nasa is super adept at keeping everything safe. And if you look at the european budgets right now, they look like theyre committed. And you say how long should i go . I think when the yield coming off it is decreased, but right now a lot of the commercialization in space is around the space station. Were in a deal with the air lock from which they dispense their satellites, we built that and of course we take a payment whenever they launch something. Its a lot of little Business Models like that going on. The mass challenge incubator where were paying people to bring experiments up. Talk about the inc. Cubator how thats going. Theyre clearly allowing that, as long as it does no harm to the station, theyre allowing us to build businesses out there. The prominent examples are the Small Businesses, but were working with a lot of them, and in fact were trying to stimulate some. Its a little like our horizon x arm, but as kind of a venture arm called horizon x, we take shares in companies that we think are maybe those ones that are going to survive longterm and they might have some technology we think wouldnt exist well in our company, but we can help it be born in another company. So i see the station as an incubator like that. Youre seeing all kinds of Little Things being tried and well discover sustainable businesses out of that. And when you think about those sustainable businesses, is that when we plan for that gap that you talked about, do you think that were going to avoid the gap is actually what i was trying to we are going to avoid the gap and i want to come back to the things we need to do to help avoid that in one moment. But do you think that everyone is thinking about when we close that gap, when we avoid that gap, were talking about something that succeeds the International Space station, and hopefully something that talks about and furthers the type of innovation like the Incubator Program that you just talked about. Do you think thats a common view of what the next stage of man living in space looks like . Do your competitors, does the government, does nasa, do Public Policymakers, do they share that view of the future . Im going to be bold and say yes, but not in the same architectures. I think in large people agree that we would like to see lower orbit commercialized, a little easier to get to. Its a place weve shown we can do some business, so i think people imagine hotels and commercial labs and i think other countries talk about building their own space stations there. So i think everybody madgens some form of proliferation. I think the Artemis Program is on a scale where theres room for everybody. So you think about lower orbit, its commerces job to populate that more. And the government will lead like with the railroads in the west. Well build some devices that help us go to deeper space. So i think those arc textures are going to do deep and lower orbit are generally agreed. How you do it, a lot of competition, a lot of some architectures are only for the people describing it, some are very open. We want to see a lot of players so we can be institutionally interdependent. I think its great. I dont know how its going to end up. It is exciting. And to your point about having leaders who kind of express that excitement, it really one of the things that at the chamber were proud to work with boeing on, as well as our other members, is laying that Public Policy groundwork. We talked a little bit about how the government being an important buyer and incubator of these things. But they also lay out a lot of the vision in a way that brings together the commercial side. I mentioned the air and space museum. Its not a coincidence that bri jim bridenstein, before he was a member of congress, was the executive director of the air and space museum and you see his passion when you talk to him about it. But like all administrations, theres a finite time and the time horizon that we talked about in terms of avoiding the gap is going to exceed any will exceed the next administration, whoever that is, and the next administrator and probably the next administrator after that. So what can we do as enthusiasts, as advocates, as boosters for that kind of exciting future to main than that level of enthusiasm so that we maintain the level of commitment and support to make sure we avoid the gap and get to the future that you talked about . Do you have any advice for us in terms of what we can do in that regard . Number one i do, i have a little strong sinterest in this. Number one, we need to look at the larger space ecosystem that is emerging, and especially artemis as a program that we all have to pull together and try to make happen. We all see ourselves in it in different ways and we want to do well, but we have to advance it. So we all have to support each other. So here sits a boeing guy on the stage and i cant see my colleague if hes here, but i would like to congratulate Lockheed Martin for advancing the test, because theyre building a deep space machine and shes going to go to the cape after this. So round of applause for those guys. [ applause ] so i know that sounds odd, but the thing im trying to defeat is im 35 years in and ive never seen a time in human space flight where everybody was rooting for everyone else. And im not sure thats really happening everywhere right now. And so were trying to commit to say, okay, lets all be mutually supportive within the confines of the competitions we have because this is a national policy. And as you mentioned, were all going to have to stay committed to it through good times and bad. And thats how the station and the shuttle flew. Were going to have to be sustainable. Number two, we must have the new generation of talent seeing themselves in this. The museums, the work we do to make sure that early career people get a lot of access to people like Chris Ferguson and those of you in the room, many people in the room, we all must invest time in that, because theyre the artemis generation. If were not going to have that human gap, theyre going to carry the torch. Whats left for me is maybe to pass on a few lessons. Its pretty exciting to be able to carry the torch but also exciting to pass it off and know that the future is bright. Thanks for taking time and sharing with us a little bit about not just what boeing is doing, but the perspective on the overall architecture and thanks for sharing your enthusiasm. Thats whats most exciting, is that this isnt just a brief moment in time. This is a moment in time that is going to define future history and its pretty exciting to be a part of it. And im privileged that you took some time to share with us today your thoughts about it. Thanks for doing this. I think you would find the same enthusiasm all over the audience and were at the front end of something pretty big. Join me in thanking jim for spending time with us today. [ applause ] knowing and now, eric graham, Regulatory Affairs, north america, at one web. Senior Vice President of Global Launch Services at rocket lab usa, Brigadier General Wayne Montief and chief executive officer at hawkeye, and Vice President of air force programs, center for programs and technology. Good morning. Its great to be here with all of you. The topic for our panel this morning is the evolving regulatory needs for commercial space and lower orbit operations. So thank you all for being with me. I think we all know that the future of space Flight Operations is going to be shape by the increased demand of the volume and diversity of commercial space. We also know that this is a global challenge. And it really calls for the safe and responsible behavior from the international community, as well as capabilities in areas such as space domain awareness, space Traffic Management and continued innovation. We also know that we need to account for challenges in National Security, while at the same time enabling growth in the commercial sector and promoting standards for safe launch and space at that international community. To do this, its going to take a government approach, as well as continued collaboration between government and industry, and we are very fortunate that our federal agencies are looking to focus on those regulatory processes to help streamline the activities and the regulations that we need to do that. So were going to have a great panel this morning to discuss this meaty topic. You already heard some of the names. Let me do some introductions. To the right of me i have john, the chief executive officer with hawkeye 360. Brigadier Wayne Montief who made promises to himself when he retired, one was not to work in government again and one was not to live in the washington metro to metropolitan area. And we also have eric graham, who has been in his role for just three months as the director of Regulatory Affairs at one web. So thank you for joining me. We just have a little bit of time together. My first question im going to give to you, general montief. If you could walk us through some of the regulatory approaches that youre taking that are intended to streamline launch licensing and permitting. What are some of the key points of contention in that area, and how are you working to balance those considerations . Well, first off, it was great to get space policy directive number two actually directing us to streamline our regulatory con construct and combine four different roles into one. The cornerstones, number one, is moving from a prescriptive approach where we tell you what to do to how to solve problems, to a performance based approach which will unleash innovation, while still maintaining Public Safety, and also being able to do a single license for multiple launches from multiple locations, which is just one of the ways that we are looking to help us keep up with, if not stay ahead, of this tremendous increase in both cadence and complexity in this industry. We have to have as light a regulatory touch as possible to enable this business. Thank you. So im going to turn it over to eric next to talk about one web and some of the ways that one web is looking to promote the sustainability of leo constellations in space, and how does the new constellation designs, how do they change the nature of operations and what are some of the emerging concerns and how might Regulatory Reform help to address the challenges that are emerging . We heard this morning that there are so many more satellites that were authorized within the last year at the fcc than what exist in space today in lower earth orbit. And as you see these large constellations that are necessary to connect the entire world stop for just a minute and think weve had wired communication for over a century, wireless commune kagic for decades and massive parts of the earth are still left uncovered. These leo constellations are the constellations that will be able to connect those areas and connect those people in the economy. Were talking about billions of people on earth who are still unconnected. So its necessary to have these large numbers of satellites in low earth orbit but its just as necessary to think about what happens to those satellites once theyre up there. You think about succeeding 99 of the time, and thats pretty good. But when you talk about thousands of satellites, thats a large number of dead satellites. 1 failure is a large number of dead satellites that are up there. And unlike terrestrial collisions, when you get to space its not that easy. And that impact has the Ripple Effect and a Chain Reaction, potential particles that cant be tracked, but that can destroy future satellites or that can puncture the space station, for instance. So we have to think about what happens to those satellites at their end of life and you have to have certainty that those satellites will deorbit in a proper way. And one thing that one web is focused on in space is how we make our satellites capable of being retrieved should something go wrong. The technology is not quite there right now, but active debris removal in space is something that we look at. So responsible space is a major theme for us. Weve launched a website responsible. Space that brings together all the principles that guide us as we design the satellites and make sure theyre operational on earth before we put them into space, and as we follow our deployment plans and launches starting next year. Can you talk to us a little bit about some of the challenges that you see from an International Perspective and the way that some of our the other players in space might challenge some of the things that you just described . Yeah, so there has to be International Cooperation around how we get these satellites into space and what happens to them once theyre up there. And the concern that we can have as a satellite operator is countries getting ahead of each other and going in different directions. You can only lead if everyone follows. If you lead and no one follows, then youre an outlier and the thing that hurts companies as we plan is are we following the outlier and what happens when there is not some sort of regulatory consistency. So International Bodies exist, some met last week in egypt to work on spectrum and thats a good place of an example where countries can step out from the group and make things more difficult for the operators and that puts at risk connectivity in that country. So john, im going to turn over to you. We just heard about some regulatory uncertainty, we heard from general montief about kind of the lightweight regulatory processes that were trying to put in place. Tell me from kind of the startup community, what are some of the uncertainties in the regulatory space right now and how do they sbaimpact startups . The way to think of it is from a financing perspective, startup, thats the most paramount mission. And as a Venture Capital investor and startup operator ive seen an interesting paradigm shift, which is more are riskembracing as it relates to a lack of a defined policy regime. Because theres less white space out there traditionally, for new companies to create. And in order for the next company to take off, sometimes they have to dabble in the gray zone because there isnt a whole lot of competition. I would point toward an uber, a airbnb, companies that were established before the Regulatory Regime was established. You walk outside and see all these lime scooters. There wasnt a reg la story regime outstanding for how those scooters should be in place in the streets but they went ahead and did it anything. So for vcs looking for the next great thing, regulatory uncertainty is not necessarily a bad thing, but there is an offset, where the regulatory uncertainty has to come down as the amount of capital goes up. And the space ecosystem, given the kpap t capitalance tee, that means its more dangerous. So for a company like hawkeye, being able to showcase to our investors at larger fundraising totals that the Regulatory Risk has reduced is very important to us. Can you share a little bit about how the faa and even the department of commerce have been interacting with industry, especially some startups as youre looking to explore some of the impact in needed regulations . So as i mentioned earlier, its not only the increase in cadence, but its complexity and its working with startups and trying to come up with or working to a regulatory construct that supports companies that have been doing this for decades, or theyre launching almost every week, to companies that wont launch for the next two to three years, but theyve got an innovative plan to get to orbit. And so its laying that foundation that does not stifle innovation, actually empowers innovation, but creates regulatory certainty so that investors are encouraged to come into the market so that they can maintain Global Leadership and not lose out in this sector. And so whether its coming up with ways to for instance, Safety Systems on board a rocket. You would think it makes sense youve got to be able to stop a rocket. But what if youre launching from a place where the impact if something goes wrong is essentially negligible. Do you still need a Safety System on board . No. And were trying to come up with a construct that will allow that. And then instead of carrying the extra weight and complexity on your rocket, its simpler to design and get to orbit, you can carry more to orbit and you can get your license through quicker. And so when i look at what we do, its maintaining Public Safety and weve been doing this for 35 years and we have never suffered a fatality or injury to the noninvolved public. Its keeping that Going Forward while also allowing these companies to innovate and go fast. Thank you. So that was actually a great leadin to some of the things that you and i have been talking about. You shared that you are moving your next launch, i believe, is that right . This spring. So if you could talk to us a little bit about how the new footprints of launch activity, both in the u. S. And worldwide, are evolving, and really for you what does drive the launch locations for commercial providers . Like a lot of things, its really driven by market demand. What orbits do our customers need to get to. Weve been operating out of new zealand where weve launched nine times, launch number ten coming up this week. Were getting ready to open up island in virginia and we have customers that prefer to launch from u. S. Soil. So when youre picking out a launch site location, market demand is going to be a big driver because you have to have a Business Case that closes, but youre also driven by geography and geopolitical situations. If you can get closer to the equator, you want to make sure youre launching over open spaces, but you also want to be in a stable location so youre not worried about whether or not youll be able to launch. Weather is a factor as well. Its all of these considerations. So for us, operating the first private Launch Complex out of new zealand has worked out perfectly. We can launch up to 120 times a year from there. Weve had Great Partnership from the faa in licensing our launches and also payload licensing, so theyve been a huge help to us in terms of a startup getting up and running and being able to launch on a monthly cadence. Weve had good cooperation from fcc and noaa as well. So thats worked out quite well. Now launching, were interacting more with the Government Agencies and other partners that are launching from the same Launch Complex, so we have to be a good partner there as well. You mentioned launching on a monthly cadence. Lets kind of stress the system a little bit and take this more to a weekly basis when you look across what the future may have in store for us. So a question maybe for each of you on the panel. So when you think about this increase in volume and this possibility of weekly launches, what will be needed both in the Space Operations and the air operations domain to make this successful . Ill open it up to the panel. Launches that frequently are absolutely necessary for a company like one web and we built a satellite factory in florida where at peak production we can produce two of our satellites a day and we are launching 30 to 36 satellites per launch to build the constellation as quickly as we need to. So thats just one ngso operator. You add a couple more in there, plus any other missions, and a weekly cadence of launches is not out of the realm of possibility. It becomes a necessity, in fact. So there has to be a way to coordinate that. There has to be a way for the folks who handle the launch vehicles to manage it. And then of course once the satellites get up there, thats where our people fly the satellites and other companies do the same thing and we have to coordinate up there as well. Were on a path to a launch a week. In 2020 its once a month. Probably twice a month on a couple of months. Its all driven by market demand. But the demand across commercial customers worldwide is rising steadily as we talked about earlier. The path that the economy is on is leading us in this direction. One comparison was made to the maritime industry, if you look at the airline industry, same sort of growth pattern if you look at that recover the last few decades and were on that same path. So when general montief was running the space wing, that wasnt just one launch provider, but multiple providers launching from the same complex, so the challenge was to the enterprise to be able to support that. For hawkeye the bottleneck isnt launch right now. Frankly, its the manufacturing capacity here in the United States. American manufacturers of micro satellite buss is relatively paltry. Most of them, the r d facilities arent set up at scale, particularly with not only u. S. Operations, but u. S. Ownership and principally a u. S. Supply chain. That is difficult to find at scale. So we need to encourage that and set policy to allow that manufacturing facility here in the u. S. To flourish. Thank you. When you look across what these companies are trying to do, we have to have the right regulatory construct. My office has to be a jigile an responsive and move fast. And we can do that. In the last seven years, our Licensing Activity has increased about 1,000 . We see that theres a potential for that to happen again over the next five years. And so 2012 in my office, we had essentially 25 people to do a single license. Now im down to less than three. We cant keep that cadence up unless we do a couple of things. Number one is hire good new folks. Were always looking to hire if you know somebody out there who is in this business and wants to come be a regularity, which is exceptionally exciting. But i cant increase the size of my office by 1,000 , so weve got to get more efficient and more effective. The streamline rule we talked about, thats going to be one part of it. Its also reorganizing our office. Back in april the secretary announced that we would restructure the office of commercial space transportation. Im happy to announce that steve dickson, my boss, just approved that reorganization last night. That will allow us to be more responsive to industry as we move forward. Now, with that cadence, the other issue that youve got is getting into the air space, the onramp or getting through. And i look at it like an onramp on the freeway. Youve got to be able to safely get there. We have to move, and we are moving from segregation and segregating the air space to integrating. One of the things we did this year is we moved responsibility for integrating space transportation into the National Air Space system from my office to terry bristols office, the traffic organization. They own the requirements, they own the priorities, they own the funding. They will get this done. Theres nobody better in the world at air space integration than them. Because even though the fact right now with the commercial space Transportation Industry is relatively small, its going to increase. And on the other side, one general aviation aircraft can stop a launch with a Single Person on board. We have to be able to use the limited air space effectively. The faa is committed to doing that. Thank you. So lets take that a little bit further. So as the surface that the space Traffic Management evolves and moves to commerce, what will be some of the significant changes and what should the commercial players hope to gain as this moves out of the dod domain into the commerce domain . I can start that and im going to become a broken record here, and its safety. As it shifts to commerce and out of the dod realm, and youre still going to have all the sensors providing data, first and foremost the foundation has to be safety. Without some kind of safety construct or an eye towards safety, there is no commerce. Those that would suggest that we were already at the beginning of the kessler effect of debris creating more debris and creating orbital regimes that we can no longer use so we have to be sensitive to that. And without that, we have no ability to take advantage of this trillion dollar economy. And so whether its getting to the air space or actually functioning once youre on orbit, folks, quite frankly, have to play well. You have to be sensitive about the debris that you leave. You have to be sensitive about moving out of another satellites or another satellites orbital path. I was in the organization in the air force when 333 and cosmos 225 hit and that was a really bad day. Fortunately, we havent seen any more of those, but its out there and its going to happen at some point. Let me hear from a commercial perspective on what your needs are and what youre expecting from kind of this new Regulatory Environment that were entering into. So if we want to evolve into a period where were launching almost like airline taking off and landing at major airports and integrate into the interNational Air Space system, then we have to adopt to the rules of the road. Ways that we can do that is both regulatory, but also technology. So one of the evolutions that is happening right now is the move from a command system where you rely on a lot of ground systems and humans, to an autonomous flight termination, which is on board and it provides a lot of benefits. Its actually a safer model in which to operate. Were going to be launching using autonomous flight termination on our upcoming launch and thats our standard. The government has come out and said this is so important and so good that we want to set that as a standard for everybody to migrate to by 2023, was the target date set. So thats going to help move that direction. And thats very beneficial. Another thing is being a responsible participant in the space environment, whether youre a satellite operator, whether youre a launch provider. And so our mantra is lets only leave the satellite, the payload on orbit and its got regulatory requirements to deorbit over a period of time. But we dont want to leave any other parts or debris up there. Were trying to bring back our booster and we want to be responsible in that manner as well. So there are some of these norms and practices that are starting to come into effect that are going to help the whole industry move that direction. John, ill turn to you. Lars mentioned some of the technology areas, too, that we might be able to kind of partner with this to help promote that safety as we transition from the surface to space. Any comments on that from your perspective . Well, as an operator we obviously care about the quality of the conjunction notifications that we receive. Who provides that to us, were kind of agnostic. We dont necessarily have a viewpoint on that. We just care about quality of service and ensure that we get the information that is necessary as timely as possible. From a technology perspective, its the global tragedy of the commons that weve seen, and we do a lot of work within maritime domain awareness and look for bad actors who are using the Global Common in nefarious ways, Illegal Fishing and human smuggling, et cetera. Same concept in space. It takes all of us with a concerted effort to be good s w stewards. It starts with hawkeye and there will be thousands of spacecraft. But if were not all following the orbital debris requirements, then shame on us. I would say the pace of innovation these days makes the regulators job probably harder than its ever been. Regulators have a very difficult job to do. And on one extreme you have the viewpoint of the regulators should control everything, down to the color of the rocket perhaps. On the other extreme, you have people who would say regulators have no business here, youre going to destroy my innovation, my job is go fast and break things. The right place, as so often is the case, is somewhere in the middle. And we believe theres a place for forethought in regulation and a framework that we can all follow. You cannot have the wild west when youre talking about Something Like space, which is a common area for people, which can be destroyed for the future by one or two bad actors. So i dont envy the job of the regulators. We truly appreciate the job that theyre doing. And i think all of this comes back to and youre hearing this from general monteith, the value of foresight within the regulatory agencies. And we see this with other agencies around the globe that we have to work with to get rights to some of their spectrum. Some of the regulations that we are having to work through, most in fact, are designed for geostationary, and so fees that might have been appropriate for a single satellite sitting above the equator are suddenly impossible when youre dealing with 1,000, 2,000 or more satellites. And so the pace of regulatory change has to keep up with the pace of innovation, and so theres probably a need today for more collaboration between stakeholders and regulators than ever before. Yeah, i mean, we talked about the government as regulators, but theyre also facilitators. So as this transitions from one agency to another, you know, commerce is more about promoting the commerce of space here. And theyre in a facilitator role. Theres also companies that are entering the space economy that are going to help facilitate as well, Companies Like leo labs that are tracking very small objects in space and helping augment the government space tracking and space domain awareness. Youve got companies that are looking for active debris removal constructs and models that are really on the forefront of that, because what we talk about, the thread of orbital debris, we really dont have Good Solutions for it right now other than to wait it out. And thats really not a good solution. The current odmsp debris standards requires deorbit within 25 years. That was written long ago when 25 years seemed reasonable. Thats completely unacceptable today. So thats going to drive the whole economy, the whole space economy, all of the participants to upgrade just like we talked earlier about the autonomous flight termination system as a new model, a new standard that were migrating toward in a shorter time period. In the faa, my organization is unique in that under title 51 of the u. S. Code, we also have a responsible to encourage, facilitate and promote not just safety. And we take particularly the facilitate part to heart and that allows us to be able to lean a little further forward than some regulatory agencies may be able to lean. Because we do for whatever reason, the government still considers this, after 60 years, and weve at least got the faa to stop calling space transportation new entrance. At what point do we become just standard . But efp, we call it encourage, facilitate, promote, allows us to find the right regulatory construct to enable these companies to be successful. Thank you. So we have just a few more minutes. What im going to do rather than posing another question to the panel is just give each of you an opportunity to kind of share perhaps from the perspective in the chair that youre sitting in, what is the next most exciting thing that youre looking forward to in this area of commercial space and leo operations, and what scares you most . John, lets start with you. Ill address what scares me the most. And its an area that i think is light on Regulatory Oversight right now and thats not the hardware of the launch, its the data. And the attack factors endemic with data, particularly data thats flowing into National Systems and arc textures. That data has to be trustworthy. It has to be cyber protected, and i dont think that thats a point of emphasis for a lot of cybersecurity, particularly Cybersecurity Startup Companies without the kind of resources which hawkeye has, but others do not. So im concerned with cybersecurity for small operators. Thank you. From the exciting perspective, being on the horizon of human space flight participants, we dont call them passengers because we dont regulate to passengers yet. But getting more folks access to space, which i think will continue to generate a tremendous amount of excitement to go along with a tremendous opportunity for business. What scares me doesnt really scare me, but concerns me, is we are living in buck rogers time right now. This is just exciting. And as a little boy if you cant drive a truck for a living, being able to be in the rocket launch business is about the next best thing. But as i try to regulate this industry, im governed by an act from 1940, the administrative procedures act. So im trying to regulate space transportation with a foundation that was set before we even had jet aircraft. And we want to go fast, we want to have the regulatory touch. That concerns me. Thank you. So whats exciting is what youre hearing right here, i guess awareness of the challenges and the problems is the First Step Towards making improvements and innovating and opening up this new frontier, which we have to do. Theres a forecast of trillion space economy by 2040 and some are even hotter than that. What we dont want is build it and no one show up. So we need to do this in a responsible manner, but we also dont need to fear it. So there is a tremendous opportunity to open up low earth orbit and i think youre going to see that with some of the constellations, going to the moon, all of these things is all going to stretch us and move us that direction. So its a very exciting time. And we need to do it in a responsible manner and weve touched on some of the things that we worry about a bit. Theyre all machineable and i think awareness of these and taking the responsible steps is the path to approach those. Thank you. Last words . Im really excited about the coming year. Were on the cusp of unlocking the Global Economy for half of the worlds population. Im not quite of the age where i remember space being Science Fiction. I remember it being for astronauts. And were to the point now and youll see this coming online this year and certainly the year after, where space is becoming for everyone. Not just for astronauts and not something just out of Science Fiction movies. 2020 for one web is a year of scale. Thats when our cadence of launches become regular and the constellation will start to do customer demos and then come into full service in 2021. Total coverage of the globe. Something thats never happened before and something that well be the ones to provide. Well, i think were out of time. I want to thank each of you for joining me for this exciting conversation about regulatory processes. So thank you very much. [ applause ] and now Vice President and general manager Propulsion Systems division at northrop. Good morning, how is everyone doing . Im delighted to represent Northrop Grumman. You astutely noted, and ill quote this, the rapidly evolving space sector has the potential to create new markets and opportunities that will transform the economy as we know it, which means now is the time for greater government and Industry Collaboration to chart our path forward into the future. So the point on government and Industry Collaboration, i also want to commend the Leadership Team at the headquarters, as well as the space and Missiles System Center Whose Mission is to deliver resilient and affordable Space Capabilities to defend the nation. The air forces acquisition approach for National Security space launch to modernize that National Security space launch has unabld unprecedented levels of collaboration and has yielded a Record Number of offerings. This has accelerated fielding the next generation of space lift systems and kept us on track to meet some aggressive goals. The air force has done this while addressing some significant risks and challenges, like meeting a congressional mandate to eliminate our depe eliminate dependency on the russian engines by 2022. Their inclusion of a block by and acquisition approach has enabled significant corporate investment, and by leveraging the shared investments from both government and industry, theyve enabled highly innovative approaches to space launch that will position us for a more sustainable future. Later today youre going to hear from speakers who will address important topics like ensuring the u. S. Remains the center of the future space economy, and ensuring u. S. Technological dominance in space, as well as discussing the risks of losing u. S. Space dominance and what is at stake. These topics appropriately focus on the risks that we must manage to be successful. So i thought i would talk to you about omega today in terms of how it addresses risk and enables Mission Success for our nation. Specifically, Northrop Grum onlds approach is through the lens of three key areas, key risks. Financial risk, and then the physical or Operational Risk and then National Security risk. As for financial risk, its well known that building and launching rockets has been an expensive endeavor. Its a capital intensive business requiring large facilities in tooling and the harnessing of massive amounts of energy. As those of us this business recognize, perhaps the bane of our existence is overhead costs. For every rocket that makes it to the launch pad, the price paid by the customer covers much more than just the direct costs of building it. Behind the vehicle itself, payments to cover depreciation on the companys tooling and facilities, meaning that we have reserves to replace them as they wear out. Medical and benefit plans for the workforce, taxes, utilities, shipping and transportation costs, insurance and much more. The fact that space launch is so capital intensive drives most launch providers to pursue large annual flight rates, to spread those costs over more rockets. This approach works well in years when theres a large demand for launches. But history has shown that projected launch rates dont always materialize. And given these lessons of the past, today the air force is right to address its Financial Risks by demanding that todays competitors show that they will not be dependent on a Large Air Force launch manifest for their business to be viable. Now, Northrop Grumman is the only company that sells many more products than its launch vehicles. Meaning that our overhead costs dont have to be covered by just omega. Instead, they are spread over many other programs and provide a tremendous economy of scale. When we set about developing omega we did not have to add new facilities or a new workforce. Instead, we added onto the margins of what already existed. Omega comes from the same plants that provide the dod, the trident, nasas rockets, and the missiles and others. The core stage of omega is nearly identical to the sls booster segments by design to enable synergy. So instead of a launch vehicle in search of many flights per year, omega adds a few more components to the existing manufacturing lines of the other programs. With this robust approach, Northrop Grumman will be there as a reliable partner when the company suffers a downturn. Similarly, omega utilizes the facilities at the space center to drive down large Operations Costs that would come with the unique infrastructure for just one rocket. The air force will receive costbenefit from omegas sharing the sos vertical assembly building, the mobile launch platform and launch pad. This is also good news for nasa as it will lower cost for human explore magz. Northrop grummans approach for sharing resources is unique in the National Security space launch competition and allows the omega Business Case to close on very few launches per year without the need for complex reusable systems. Finally, its the only company among the competitors thats publicly traded bringest ting t highest level of transparency. This is not a trivial consideration, by spreading Business Risk across a large and diverse Product Portfolio like ours at Northrop Grumman, we have the ability to be there when the going gets tough. The second risk i mentioned was the physical or Operational Risk. As for the physical nature of launching vehicles, the air force has always placed very High Expectations on reliability and resilience in the systems they will procure. Obviously with over 130 successful consecutive launches, its understandable that they want to maintain the high level of quality while striving to do better on cost. With omega, Northrop Grumman took an approach that leveraged broad experience across our entire business, particularly in mission assurance. That begins with design simplicity, which reduces the likelihood of a failure. Omega is the only offering that launches propulsion in a significant portion of the overall design. This brings several clear benefits. First is a historical track record of lower failure rates and now both liquid and solid propulsion have come quite a long way in reliability over the years and theres not a significant difference in them statistically, but 500 flight streak, historically we would expect one failure of a solid motor as compared to four failures with liquid engine systems. But perhaps a greater consideration is the balance of risk the omega design brings to the fleet options available to the air force. Part of assured access comes with dissimilar redundancies across launchers that they select, which are solid propulsion offers. Further more, omegas design simply fies processing and operations. Once its stacked on the launch pad, there are very few things that preclude launching it. Fewer liquid propellent valve leaks, fewer moving parts, greater launch availability and enhanced Mission Readiness and resilience for the air force. Finally comes the National Security risk that i mentioned. Northrop grumman is the only competitor for space launch that serves National Security systems for the dod across a very broad array of systems, from cybersecurity systems to Mission Planning and control facility operations, aircraft, spacecraft, missiles, and launch vehicles. Northrop grumman is a Company Built around National Security needs. With this heritage comes an unwavering commitment to the air force and the air forces mission to achieve highly reliable and sustainable launch capability. Although we all want to see this nation return to the moon and go on to mars, no one wants to see that more than me, we also recognize that enabling the economic freedoms of this great nation depends on unsurpassed National Security capabilities. And to that end, we are 100 focused on the air force Mission First and we recognize that once operational, omega will offer an affordable highperforming option for commercial and Exploration Mission needs as well. So omega is on track for first certification launch in early 2021, an impressive timeline to field a major new system. Weve ground tested the core booster that the air force needed to replace the rush 180. Many of you watched the first ground test which verified perfect thrust and performance. The results further helped engineers refine and validate our models, increasing our readiness for flight. Our liquid upper stage manufacturing is well under way in louisiana. At the Kennedy Space center were modifying one of nasas mobile launch platform to be able to handle the omega and that structure will be rising above the kennedy skyline beginning in january. Its been my pleasure to share with you our approach to omega and the challenges of the National Security space launch mission. Perhaps some of these concepts resonate with your own business or conserve to advise you in your own future business choices, but at Northrop Grumman its a privilege to be part of the Space Community and we look forward to our collective success in the future. If you would like to learn more, we welcome you to join us at our booth in the exhibit area, and i thank you very much. [ applause ] announcer please welcome the honorable mike griffin, undersecretary of defense for research and engineering, u. S. Department of defense. Well, already im at a disadvantage. I cant see you but you can see me. I want to use my time this morning with you in about a 50 50 increment. Im going to talk for maybe 20 minutes and then id like to take questions and ive got a great timer here to keep me on track. Its always my impression that people would rather bend the flavor of discussion toward topics in which theyre interested rather than just hearing me uppontificatpontific. Let me get things started. You all are about commercial space. I know about space in general but about commercial space and u. S. Technical dominance in space. We are after all here in the u. S. Chamber of commerce. Space is an area that from a commercial perspective remains intriguing, and so im going to try to talk a little bit about that and how the commercial perspective blends in with what were trying to do in National Security space, but i want to start at the top level if i might. The u. S. Government buys an awful lot of different kinds of things. We buy things that range from Aircraft Carriers and submarines and f35 fighters, and we buy micro chips. Now, it will not be lost on this group that there are as yet there is as yet no commercial demand for an Aircraft Carrier for a missilecarrying submarine, and i think very little commercial demand for fighter aircraft. On the other hand, there is actually percentagewise very little demand on the part of government and the National Security community for micro chips. Yes, we have an enormous appetite for chips, but we are something less than 1 of that market. So the best thing in that side of the spectrum that the u. S. Government can do and the department of defense and the National Security community at large can do, the best thing we can do is to invest in certain areas where our micro circuitry demands our unique and not part of the commercial sector such as chips that are designed to withstand prompt nuclear dose or longterm high radiation exposure and in other areas to simply follow the market and do our best to stay, if you will, out of its way. Whereas with Aircraft Carriers, we have to drive that market. We have to we have to be the designer and the prom you will gator of Aircraft Carriers or they wont happen. Space is somewhere in the middle. There is a commercial demand for space and all that space brings and it is growing. I think that during my time at nasa i was one of the people who strongly pushed for more of that. We pioneered in my stint at nasa we pioneered the development of the commercial Cargo Resupply Services to space station, so i regard myself as a cardcarrying supporter of as much commercial space as the United States can bring to bare. At the same time, in the present era, the demand for commercial space is insufficient to maintain the kind of Industrial Base we need and, in fact, the demand for National Security and other civil government space sustains that market. I would like it to be i would like one day to believe we will reach in commercial space the status we have in micro chips where were 1 of the demand because that would mean we had a thriving economic sector making money out of space, and the government could simply buy what it needs and invest in those areas where commercial sector doesnt tread. Were not there yet. So, as we think through how we develop and sustain both National Security space and commercial space, i think we should have an eye to each other in how we can synergize those developments. There are u. S. Government policies that we can implace and support that will provide sus nance to the commercial sector, and there are commercial sector behaviors and investments that can help sustain National Security space. Why do i care . What problem, in fact, are we trying to solve here . Well, from the perspective of my present position, the problem were trying to solve is that space is no longer an uncontested u. S. Operational domain. We have today the Space Architecture that i would have designed, frankly, in an era in which we had no adversarieadver. Space has been critical to our way of fighting war in the mideast and the ball cans and before that the mideast again. The problem is that our adversaries know that. China and russia are investing, have invested in methods by which they seek to nullify our space advantage knowing it to be a critical advantage. So we, the United States, along with our partners and allies are going to have to rethink our Space Architecture from the ground up and critically, were going to have to evolve the pace and the style with which we enable those new Space Architectures. This takes us to the Space Development agency which was the dods response to the congressional question in ndaa18 of dod, how do you plan to manage space for the future. I collaborated with then deputy secretary shanahan and many others in the air force and across the dod. We collaborated together to advance a plan, the socalled 1601 report, by which the department would seek to manage space in the future, particularly with regard to enabling the kinds of Development Timelines that we used to enjoy back when we were serious about great power competition. Ill just added ancillary remark in that vain. I think all here know that our government acquisition timelines tend toward the 15year mark on average from statement of need to operational capability. Our adversaries are using three and fouryear timelines consistent with what we used to be able to do. Ive often quoted this example only because it is so, from a certain perspective, heartbreaking. When the f117 a Stealth Fighter was developed 32 months after the contract was signed, there was an arirplane on the ramp. 32 months for something that had never in Human History been designed and built. We would be arguing about the requirements in todays environment for 32 months. If we cant relearn how to do what we once knew how to do better than any other society, we will not prevail. So the Space Development agency was created within dod to work outside the existing acquisition system, to work with commercial space, to work with their purveyors of new architectures that would be more proliferated, more resilient, and above all else, more timely in their application. There were two overwhelming needs that are first entrants in the new architecture needed to provide. Those two overwhelming needs are robust and resilient communications, what we have been referring to as the communications transport layer designed to consist of a network of low earth orbiting satellites, to provide so many targets that our adversaries cannot easily remove them and certainly cannot remove them in a peril harbortype strike. And secondly, secondarily, the development of a surveillance and tracking layer that can see the conventional hyper sonic glide body threats that in particular china and secondarily russia are developing and deploying. These threats have actually fairly robust signatures but the signatures are some 15 times lesser in magnitude on average than the Strategic Missile threats that are existing overhead constellations are designed to observe. Simply put, we need to be closer to the action or we need much larger and much more powerful optics farther from the action. It is our thought that we need to be closer in, and so the secondary function of the Space Development agency is to develop and deploy that tracking layer. This will give us the persistent global low latesy surveillance tracking, targeting and fire control that we really have to have to meet these new threats. Now, if we take as our paradigm that this is going to be government business as usual, then i dont know what the outcome will be but i believe that based on now nearly 50 years of experience in the business, i can guarantee what the outcome wont be. The outcome wont be affordable and it wont be timely. So we need, if we are going to develop proliferated Space Architectures, whether in low orbit or medium orbit or high orbit, if were going to develop proliferated Space Architectures, we need for National Security purposes to adopt commercial sector manufacturing practices. Now, please parse my statement carefully. I do not say that we in the National Security community are going to go out and simply buy commercial assets and deploy them to meet National Security needs. There may be some cases in which we can do that, especially where we merely want to rent time, but there will be many other cases where thats not practical. I dont believe theres a commercial sector need for a tracking layer, nor necessarily a commercial sector need for communications in theatre and so on. However, we in the National Security community do have a crying need, an overwhelming need to modernize our development, manufacturing and deployment practices for our space assets. And i believe that this can only come from the commercial community and that we in the National Security community and the Government Community at large have much to learn, in fact, have nearly everything to learn from the commercial sector which is trying to stand itself up to today to deploy similar constellations. Im indifferent as to which contractor succeeds. I hope many do. We need competitors. I think the dod needs to be prepared to engage commercial sector contractors in building to our demands let me rephrase that. I think the dod needs to engage commercial sector contractors in building to our requirements the things we need but by the methods that the commercial sector can bring and that the dod has yet to learn. When we need a new fleet of automobiles for the dod, we dont set out to design our own automobiles. We set out to take automobiles produced by the automobile Manufacturing Sector in the United States, in some cases most cases, we modify those a little bit for our own needs, but we ask the commercial sector to produce them for us. I believe thats the right strategy. Whenever we can do so, if we can buy something that we need using best practice or modifications thereof to suit our needs, that should be our path, and that is the path we intend to go down to the Space Development agency under the leadership of dr. Derrick drenier. By these means, i believe that we will be able to produce the necessary redundancy, resilience, proliferation, persistence, timeliness that our Space Architecture needs to be able to deter the wars of the future or win them if we have to fight. Thank you very much. Im going to leave the rest of the Time Available to you for questions, and it would be really great if somebody could turn down the lights on me and turn up the lights on the audience. Thank you. [ applause ] im not sure theres any view which is enhanced by having more light on me. So, questions, please. Hi. Thank you, Patrick Tucker from defense one. I wonder if you could speak briefly to beyond just overwhelming numbers of small satellites leading so resiliency, what are some of the defensive either strategies or capabilities that youre looking to develop in next generation architectures possibly including thrusters and greater mobility or whatever else beyond just resiliency through large numbers . Thank you. Thats a good question. The value im not seeking we are not seeking to proliferate our Space Architecture merely to have greater numbers of smaller satellites. Thats if it is to be our architecture, that has to be the solution to a problem, not the problem itself. The solutions that we are talking about for National Security space rely us to be, in the words that i used earlier, persistent, meaning all the time, global meaning everywhere, and low latency or timely, meaning when i need it. In particular, the hyper sonic threat that we face that i believe is now common knowledge, our system is crafted with the express goal of flying above u. S. And allied air defenses and below missile defenses. Its a new arena. Its one where the United States really pioneered the r d in this but chose not to weaponize it. We werent looking for another arms race. Our adversaries have chosen to weaponize it. We really have very little choice. We have to respond. As im fond of saying, its not a difficult target. Its a target for which decoys are not readily possible, so when you see it, you know its a threat and there is a relatively long cruise phase for such weapons, but their speed is so great that you have to spot it way far out, to use a colloquialism. You have to see it coming for longer than we can do using radars positioned at the point of defense. And radars, i would offer again, are also a target. So we need better surveillance. We need persistent, timely, global surveillance. Now, in fact, that can be done from high orbit. We see these things today from high orbit. The trouble is that to piece together a trajectory takes quite a bit of time, so it is not low latency. The signatures are quite dim and not persistent. Its a real work of art to tease the glide body tracks out of the data. Thats not a war fighting solution. As i said a minute ago, we can use bigger optics for sure but thats an expensive solution which will still result in only a few very high value targets. Some years ago john heighten, our now vice chairman of the joint chiefs of staff, gave an interview to 60 minutes in which he referred, if i recall correctly, referred to these high value assets as juicy targets. I dont think a better phrase has been coined, and so ill repeat it. Our goal is to attain the necessary persistent, timely, global surveillance without creating an environment consisting of juicy targets for the adversary. Thats the best answer i can give you. Another question . Yes, maam. Same table. Hi. Theresa hitchens. Thank you for your presentation. I have a twopart question. It has to do with communications in space. You said that with the transport layer you dont believe theres a commercial market to be able to provide those satellites. I think thats what you said. Im paraphrasing. I want to make sure that i got the gist of that correct. And secondly, the air force, through a program called global lightning, is experimenting with using the star links satellites for exactly that, to create a transport communications transport capability to aircraft, and i wondered how sda might be thinking about or working with that program. Well, im not going to endorse any contractor or any contractors solution. As i said, my honest hope is that several succeed. And thats not a throwaway line. I honestly hope that several such Communications Ventures succeed. If and as they do, i think we, the National Security community, would be foolish not to be major purchasers of time on those systems. 80 in round numbers of our Dod Communications links are purchased today and i see no reason why we would depart from that. Now, that said, i think, theresa, you may have overstated my remarks a little bit, or i may have been insufficiently precise. The National Security community has an absolute need for guaranteed communications. It has to be guaranteed in war time when we really need it, not that it doesnt have a day job in peace time but it has to be guaranteed in war time. It has to be guaranteed in harsh environments, both man made and natural. It has to be, to the extent that we can do so, secure in its communications. It has a number of requirements which, frankly, do not obtain in a purely commercial environment and in which a commercial pur y purveyor would be unlikely to invest money. Those kinds of additional requirements dont grace a balance sheet. So, there has been to be, in my view, a National Security communications substructure to any future architecture that we might either buy for ourselves or rent from other people that can be guaranteed. Thats going to come at a price. I dont expect that were going to get something for nothing, so we, the dod, are going to have to defendant in the provider or providers to provide these extra things in exactly the same way that much of what we buy in the micro circuitry line is purely commercial but some things we buy that have to be ruggedized or that have to withstand high radiation environments are just different and we have to pay more for those. Im not trying to parse words but i think the difference between meeting a guaranteed National Security need and running a commercial business, i think there is a difference there and we will come to grief if we dont recognize it. Now, that said, i dont want us to fall back on, you know, hand built, one of a kind, traditional methods of building spacecraft in oncies and twosies in order to meet that need. My hope for the future and hope is not a management tool, but my hope for the future is that we can use commercial sector methods where appropriate to manufacture the items we need to address National Security requirements. I dont know that i have put it well enough but i dont believe i can put it any better. Good morning. Jeff cropperman. Hey, jeff, good to see you. Or good to almost see you. Good to see you again. Here in the United States we have a pretty clear delineation between the public and private sectors in space and in other industries. Around the world not necessarily the case. Some countries rising space powers are happy to provide Space Capabilities through Public Sector and sort of possible private sector entities that may be really state supported. Anyway, my question is, do you have any concern of the dod strategy buying on the margin of the u. S. Commercial space industry being affected by that, that is the viability of the u. S. Industry being affected by foreign subsidized state subsidized space entities . Well, i dont because i will bet on u. S. Innovation, u. S. Free market capitalism over state supported institutions every time. I will bet on it against our own state supported institutions every time. So to be clear i can always be wrong. It happens multiple times every day. But to be clear, i am a conservative in the older fashion sense of a free market, individual liberties, minimal government, balance the budget, National Defense kind of a conservative. Im uninterested in the culture wars. What other people do is their own business. I could care. But i will bet every day on the capability of free market entrepreneurs in any country over the long run to win out over subsidized state supported institutions. Now, that said, for fledgling enterprises there is a long history where enlightened Government Policies can enhance and certainly can speed the bringing about of new industries. I believe space is one of those. So i personally have been paid a good deal of money in my past life as an Aerospace Consultant to assess the commercial Communications Sector Business Case, and its a tough one to close. I wont say that it is permanently unclosable and certainly an investor with big enough pockets can take the early losses and bring it to fruition, but its a tough Business Case. If the u. S. Government by buying in early can help to advance that commercial sector case with a solid demand signal, i think thats great. I think we should do it. But in the long run, im going to bet on the free market to beat state subsidized institutions. Thanks. Hello. Kevin berry here. Thank you for your speech today, mr. Griffin. Over here. And i just wanted to ask you, earlier in your speech today you talked about the dod was trying to find between the leading the sector in Space Development and being sort of a small portion of that demand spectrum and im wondering where you find if it ever comes, accidents in space where you see the dods future in cleaning up those messes and really dealing with the difficult logistical problem of youve put up a lot of satellites, what if something happens and they start running into each other. Do you see the dod leading more on keeping space a more hospitable environment as well . I probably needed you to speak closer to the microphone but i think youre asking me about the dod role in keeping space basically clean, dealing with debris, is that correct . Yes. Okay. Ive personally been involved in the technical aspects of space debris for now over for now over 35 years. It turns out as a happenstance that i was the designer and chief engineer on the first on the dod project that developed the first hit to kill space intercept mission. Now, that was a very much an engineering prototype. The intercepter weighed a ton, literally, so its not anything like what we have on the ground today. But starting back in 1984 and 5 i became involved with the issues of how to mitigate prevent, mitigate and control space debris generation. So with that said, we know the Design Practices that will allow us to prevent, control and mitigate space debris. We need to have plans to de orbit satellites whose lifetime becomes problematic if theyre uncontrolled. So we need Design Practices which encourage the reentry of such satellites. We need Design Practices which give us highly redoundant capability to control them so that if other failures occur, the satellites remain under control. We need Design Practices so that we know where they are at all times so that the space Traffic Management function can be executed. We know what are the things to do. Its merely a matter of making sure that we have policies in place that we require constellation providers to adhere to those practices. In the long run i think we want to avoid the kessler effect, First Published by don kessler and his cohorts at nasa where past a certain point you have runaway debris generation through Chain Reaction collisions. We all want to avoid that, and i believe we know how to do it. Its a matter of implementing what we know how to do. Thank you very much, secretary griffin. Im from space news. I wanted to ask you about Space Development agency. One of the imperatives that you have said many times is to work fast, speed and what not. I know theres obviously a budget gridlock right now so you dont have funding for 2020, but what are your expectations for funding getting passed for this year, for future years, and how potentially is that going to impact your plan to get sda space layers on time . Thanks. Well, thanks. Thats a great question, sandra. Its a great question because the answer is so obvious. Even i can come up with it. Continuing resolutions, budget battles of any kind are an enormous problem for the National Security community. We are about as just plain as nonpartisan a group of people as you can find we are trying to accomplish the mission of protecting the nation. When the things we think we need to do are delayed or prevented by budget battles in congress and continuing resolutions, it slows us down and in some cases prevents us from doing things that we earnestly believe that we need to do. The Space Development agency is one of but by no means the only casualty of our current situation. So what are our plans . We will wait until we have budget approval to fund some of these activities. I think there is largely agreement on both sides of the aisle that we really do need to reform our Space Architecture and leaving aside the organizational scrabbling and Turf Management that goes on in all organizations because in the end i really dont care who does it, i think the general approach to creating a more robust, resilient Space Architecture is widely accepted and we will embark on it when the budget and the permissions allow us to do so. So thats the best answer i can give you for this coming year because i dont know when the cr is going to end. I dont know if we will ever get a budget. We will cope as best we can. In succeeding years as i think all here know, our plan with the Space Development agency is when and as the congress chooses to approve the creation of a space force as an operating entity under the air force, then the Space Development agency moves under that space force because thats the proper place for it. Now, i tell people this and sometimes i get people, you know, with a sharp intake of breath who say youre actually going to give up, you know, an organization that you supervise to another organization . Well, yes, of course because its the right thing to do and as i said a moment ago, im really uninterested in under what badge or what organization we do our work, as long as the work gets done. So we have both nearterm plans for Space Development agency and longerterm plans that are consistent with its continued life under the space force that the administration has requested. Longer term budgets, if i dont know what were doing in the short term, i have no idea what were doing in the longer term budget so i cant help you with that, sandra. Your reading on the politics of the budget is probably better than my own. Another question . Hi. We have four minutes left. Hi. My name is a. J. Hi, a. J. How are you . Hi. How are you . One question, Small Business so i guess my question is, dod has always been very just and nice to Small Businesses in the past. Do you see a potential for that kind of a thing to continue with the spacerelated activities that yeoure talking about . Because its very difficult for us to participate in them being Small Businesses, and how do we participate in that that you can see . I think youre asking, if i could hear you correctly, youre asking about how dod can enable the role of Small Business or prom you will gait Small Business capability . Yeah. For the spacerelated activities that you are talking about today. Okay. Im going to have to go limp on that. I dont know. I mean, we have more than 2 billion a year Small Business Innovative Research program that, in fact, i oversee through i dont oversee it. I oversee the people who oversee it. As i think most of us know, Small Businesses are where most of the creative urges and abilities of the American Private sector reside, so the usual exit event for a small successful business to be bought by a larger business. There are always new Small Businesses coming along, so im a huge fan but i cant sit here today and say where Small Business can fit in the reformation of our Space Architecture to be a more resilient war fighting machine. My crystal ball is not that good. Im sorry. I think that needs to be the last question because were down to two minutes. So thank you for spending time with me today and for listening to my preconceptions. Thank you. [ applause ]