This last weekend, Iridium launched 10 more satellites, and Bulgaria got its first satellite thanks to back-to-back SpaceX launches. "People don't realize that, for small countries and small companies like us, without SpaceX, there was no way we would ever be able to even think about space," said Maxim Zayakov, CEO of BulgariaSat.

Matt Desch, CEO at Iridium, echoes that thought. He said, "We tried to work with other launch vehicle companies but all were at least twice the cost of SpaceX and unaffordable based on the scope of the network we needed to launch."

Because companies like SpaceX are engineering down the price of access to space, lots more companies than Bulgarsat and Iridium are setting their sights on the sky. In the rural U.S. about 40% of people can't get internet. In my own state, Georgia, Representative Austin Scott recently commented, "Rural broadband, we need that quite honestly more than we need roads and bridges in many of the counties I represent."

Worldwide, there are 4 billion people with little to no Internet access.

Future customers of SpaceX

SpaceX CEO Elon Musk says, "you can actually do long distance communication faster if you route it through a vacuum than if you route it through fiber." Addressing a crowd at the new Seattle SpaceX office, he recently shared the big communications vision. "The focus is on creating a global communications system. In the long term, it's like rebuilding the internet in space. The goal would be to have the majority of long distance internet traffic go over this network," he said.

The race for speed

Okay, great, the world's best long haul communication route is orbital. But until recently, there were no affordable ways to get satellites in space. That's where the new private space race, sped up by private companies like SpaceX, Blue Origin and Virgin Galactic, is creating new opportunities. After all, like Musk wrote in his Mars manifesto, "What many people do not appreciate is that technology does not automatically improve; it only improves if a lot of really strong engineering talent is applied to the problem."

By lowering the cost of launching rockets in space, SpaceX is helping more customers, like Bulgaria, afford space. More demand is creating more supply, as other space companies including Bigelow Airspace and old guard firms like Boeing and Lockheed Martin are putting more minds to work competing for slices of space.

So SpaceX rockets? A loss leader, like a "free prize" with purchase.

But for Musk, low cost launches are a means to an end. Think of them as the gateway drug to his plans for a solar-system-size communications trunk. His planned revenue stream from broadband communications dwarfs the income from rocket launches, as the Wall Street Journal recently projected from company documents. Around 2025, plan is some $5 billion in revenue will come from launches and a whopping $30 billion from satellite internet.

Much in the way Amazon morphed from an online book store into a media company with AmazonStudios, then a content ordering system with Alexa, then a cater-to-your-cravings juggarnaut with the purchase of Whole Foods, expect SpaceX to become a content creator and acquirer in the future. After all, won't newly minted Martians need to be entertained? As Bezos recently put it, there are entire economies you can create in space.

Bulgaria is one more brick in the plan toward the Belt.

Musk's plan is to lower the cost of launching satellites mostly so he can launch 4,000 of his own. Kevin Kelleher wrote in Fortune:

To put this project's ambitions into context, there are currently 4,256 satellites orbiting the planet. Only 1,419 of them are working. The rest are effectively space junk. So Musk wants to put three times as many satellites into the sky as there are in operation right now.

"We want to revolutionize the satellite side of things the way we have revolutionized the rocket side of things," Musk said. "Properly designed, we can give people gigabit access everywhere on earth." And, as you read his plan for Mars, create systems of redundant transport and communication that can help the human race build from Earth to the outer belts of our solar system.

"At the same time we want to make sure we don't create Skynet," Elon Musk joked.

The way he sees it, the satellites are more expensive than the rockets, so building out a commercial rocket network helps offset the costs of building out the communication network, which is even more expensive. Musk sees the global satellite communications infrastructure as half a hardware challenge, half a software challenge. It'll take about 5 years until version one of the SpaceX global gigabit satellite network is in use--and 12-15 more years until it's at full capacity.

Looking down the road--something Musk is great at---he points out that since Mars doesn't have roads, telephone poles, or fiber, he needs to get a global communications backbone in place here, so he can deploy a similar grid there.

Published on: Jun 26, 2017