Russia places extraordinary demands on OneWeb prior to satellite launch

Cooperation in space among Russia and the West has been stripped to the bone.

Read the whole story

 

[Wickwick]

Well, I guess that pretty much ends Roscosmos as a commercial launch option.

On the positive side, Kourou should now have a launch site they can convert to support A6 launches relatively easily. You know, to support the higher cadence expected of that rocket.

 

[Wickwick]

And that is why Europe needs independent access to space.

Which they have with the Ariane family of rockets.

I think what you need to be saying is "that is why Europe needs independent and affordable access to space." OneWeb wouldn't have been launching with Roscosmos if the wait time and cost to launch on an Ariane weren't so bad.

 

[Wickwick]

OneWeb was founded to bring the world closer together, but that is hard to do when the world is falling apart

.

Eric, I'd say at this point in time, the world is fairly united.

BRICS countries which represent 48% of the world population all declined to suppor the UN resolution condemning Russia. Doesn't seem like a united world...

You realize 1 of those is Russia? So that null. China is another which doesnt care and probably just wants to screw everyone over regardless. This isnt a valid assessment.

India is in a very tough political position. They've made remarks critical of Russia's invasion but aren't in a position to vote against Russia. But they also didn't vote for them. India chose to abstain which doesn't tilt the needle either way.

 

[Wickwick]

This notes seems to forget that China has some reasonable launch options.

China is a non-starter. They steal ITAR tech leaving the company who gotten stolen from subject to ITAR sanctions. Until recently at least when it came to rocket launches Russia has had a long track record of being trustworthy something China doesn't have.

Japan's launcher should be able to lift some. Hopefully they're all in high-inclination shells.

 

[Wickwick]

Why do so many think antitrust is a magic wand to fix anything you feel might be unfair?

SpaceX can charge different customers different prices just like any other company. In fact, they already do.

I never said that I am in favour of such measures. But it seems logical to me that it might become a problem for SpaceX. Much like the browser war became a problem for Microsoft 20 years ago. I see a similar situation here: your main business (rockets/operating systems) is used to create a secondary business (Starlink/Internet Explorer) more easily than it would be possible for the competition, but said competition also relies on your primary business go get their product going. I think the last factor is key, and that is also something I said in my previous post: SpaceX must have a monopoly on launch capability. And if they raise prices due to things that can be well explained, that might be fine, but if they do it just "because they can" that might get them into trouble.

You have the primary and secondary businesses backwards. The satellite business is 10x the size of the launch business. Any satellite operator interested in a competitive constellation will have a launch business as a minor component of that.

It doesn't matter that Starlink is bigger than SpaceX. The fact that OneWeb has no option but SpaceX makes it exceedingly clear that SpaceX is in a monopoly position for launch. That the launch business was used to establish the Starlink business is also very clear.

And there are no natural or IP-protected monopolies here. Anyone can build a launch business.

This is (mostly) irrelevant. Nobody currently has one that is usable by OneWeb.

The fact that SpaceX has a monopoly is not in any way illegal or bad. They earned it fair and square through clean competition.

And as long as they continue to compete fairly they will encounter no problems from the FTC. It wasn't illegal for Microsoft to have their monopoly, nor was it illegal for them to develop Internet Explorer. The only thing that was illegal was for them to give Internet Explorer an advantage over Netscape. Similarly, SpaceX must not advantage Starlink over OneWeb. And they won't.

But SpaceX does not have a monopoly on commercial launches. They are the only ones with capacity to launch for about 2 years. But that sort of lead time isn't unheard of in satellite launches. Ariane will bring their payloads to orbit. So will RocketLabs, Mitsubishi, Astra, etc. In the same time frame as those companies might be able to meet their needs, ULA and BO will hopefully be able to be added to the list along with a few more New Space companies.

If SpaceX says "our manifest is booked for the next 18 months" that's not monopolistic. These payloads were already scheduled before Roscosmos gave OneWeb the middle finger. That's not SpaceX's fault. Hell, OneWeb made the deal with Roscosmos in 2015 and didn't launch until 2019. So a four year lead isn't unusual.

 

[Wickwick]

I doubt SpaceX would gouge them - they'd probably charge the same they charge everyone else.

I'd assume doing anything else then charing the standard rates might bring some antitrust action against SpaceX on the way.

Why do so many think antitrust is a magic wand to fix anything you feel might be unfair?

SpaceX can charge different customers different prices just like any other company. In fact, they already do.

It's not that so many feel that antitrust is the magic wand, it's that they feel government intervention is the magic wand. Antitrust is just the excuse.

SpaceX charges standard rates, but additional services, naturally, cost extra, so it just looks like they charge different customers different prices. Those different customers are, in fact, not buying the same packages.

Neither one is a magic wand, but that doesn't change the laws and the fact that some people might want to apply them (correctly or incorrectly.) The reality is that, with a launch monopoly (which they basically have at the moment), SpaceX has to be careful about what they charge a Starlink competitor for launch services. Some government official might open an antitrust investigation. At that point, SpaceX would have to show the investigators the justification for what they charged. Go through the list of additional services, how much each one contributed to the total bill, and show that they treated the Starlink competitor like any other customer. I have no doubt they could do so. It's just a matter of documenting their accounting and contract negotiating practices. But there is a very real possibility they would be required to provide that cost justification.

Except I disagree with your premise on its face. SpaceX isn't a de facto monopoly launch provider. OneWeb's original contract with Roscosmos took 4 years to go from launch purchase to actual launch. Why should SpaceX be expected to perform in a more timely manner than that? That's industry standard (as had already been demonstrated). In that same time frame, there are at least 3 providers who could launch their payloads - possibly many more.

There is no requirement that SpaceX service a third party out of order. And if they choose to, they are welcome to charge a premium for the privilege.

 

[Wickwick]

Once Roscosmos and the Chinese are out of the picture, SpaceX has significantly more than a 70% market share. There is no firm definition for what a monopoly is, but 70% is considered a rule of thumb. The existence of MacOS did not prevent Windows from being considered a monopoly.

Lots of companies have a 70% market share in their market and don't get into trouble with the FTC. It's not a big deal until you do something stupid, and I'm confident Shotwell won't do anything stupid.

Compared to ITAR, the prohibitions that anti-trust laws place on SpaceX are a walk in the park.

What's the lead-time on purchasing a launch? Is 2 years reasonable? 4? I would argue that up to 4 years is reasonable since that's the time scale that OneWeb signed ahead of their first launch with Roscosmos.

So long as SpaceX offers to lift OneWeb's satellites in about 2 years at their normal rates they won't get in trouble. And in that time frame, there's going to be an overabundance of launch providers available. SpaceX will hardly be a commercial monopoly.

 

[Wickwick]

I think we've got a confusion of terms. "our manifest is booked for the next 18 months" might be *anti-competitive*, but it is never monopolistic. Neither anti-competitive behaviour nor monopolies are illegal or immoral, but both at the same time are.

If "our manifest is booked for the next 18 months" is true, then it's not anti-competitive either. They might be forced to prove it in a court of law, but that shouldn't be hard if it is actually the truth.

That's sort of my point. Assuming SpaceX's whole-launch manifests are booked 18 months out, OneWeb doesn't have a leg to stand on trying to demand special consideration for launching earlier. If they demand to launch this year, there would be a premium. OneWeb might even pay said premium so they can start charging their customers. But such a premium isn't anti-competitive or monopolistic. It's normal business that if you want a service ahead of a standard lead you pay a premium. SpaceX's market share really has nothing to do with that.

Now, if SpaceX is offering commercial services on a 3-month lead because they're willing to push a Starlink launch if there's a paying customer, then they had better be ready to do the same for OneWeb.