NASA sets ‘space economy’ in motion with strategy involving private sector
- November 1, 2020: Vol. 7, Number 10

NASA sets ‘space economy’ in motion with strategy involving private sector

by Sinéad O'Sullivan

NASA has announced it will buy lunar soil from a commercial partner, marking another big step the agency is taking toward promoting the commercialization of space and the creation of a consortium of private vendors focused on the sector. The plan to retrieve lunar soil suggests the eventual mining of commodities from planets, asteroids and other stellar objects.

That move is part of a historic announcement made by NASA administrator Jim Bridenstine at the Secure World Foundation in September. This foundation, working with governments and industry alike, promotes the necessary ideas and actions to achieve the secure, sustainable and peaceful uses of outer space. Its work is becoming increasingly relevant given the heightened interest in the pursuit of space activities by private and public sector stakeholders, and the size and attendee list of this year’s conference was proof of the ever-increasing pursuit of space commercialization.

From a technical feasibility perspective, this is nothing new or exciting. NASA sent astronauts to the lunar surface in 1969, and since then several global space players — public and private alike — have announced plans to send robotic and human missions to the moon. Technical capabilities have long existed for lunar surface exploration. Where this announcement shows leadership and innovation, however, is within the realm of space law and economics.

“The bottom line is, we’re going to buy some lunar soil for the purpose of demonstrating that it can be done,” noted Bridenstine. The mission directs private companies from any nation to acquire 50 to 500 grams of lunar material by 2024 and officially transfer ownership of the soil (officially called “regolith”) to NASA on the lunar surface,  after which NASA will eventually bring the lunar material down to Earth, if all goes according to plan.

The goal is to create the first-ever transaction of space materials. Long hypothesized by space lawyers, the complexity of the 1967 Outer Space Treaty — the basic legal framework of international space law — has led to global academic and diplomatic debate around the legality of “ownership” or claims of “national sovereignty” in outer space. This mission announced by Bridenstine will put to test the legal innovation that has developed over the course of the privatization of space exploration, by the many space lawyers present at the Secure World Foundation conference.

As with any sector, normalizing the ability to transact in good faith and under the protection of the law is the basis of economic market creation. As the United States develops a long-term space strategy that is dependent on the private sector, it is vital that the sector is able to show development of potential economic impact through their proposed space activities to attract investment, talent and ensure ongoing research and development.

This bold move by NASA is really planting the flag on the next stage of space resource commercialization and making a reality the much discussed “space economy,” on U.S. terms. The race to commercialize the space economy has now truly begun, and unlike the space race of the Cold War era, NASA is showing that success is only with the help of international and private sector collaboration.


Sinéad O'Sullivan is a senior research fellow at MIT Sloan School of Business. Previously employed by Harvard Business School and NASA, her work focuses on the commercialization of space.

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