"Changing Paradigms"
Dr. George C. Nield, Washington, DC
October 7, 2010

Commercial Space Transportation Advisory Committee Public Meeting

Good morning. Welcome to Washington – and thanks for being here today.

Those of us who have been in the aerospace business for a while like to think that we work in a fast-moving, high-tech industry. And to some extent, that is certainly true. But sometimes, having a good idea and sticking with it isn’t enough to ensure success.

For example, back in the “good old days,” if you wanted to watch a movie, you carefully studied the list in the newspaper of what was playing, and when you found something that sounded promising, you hopped in the car, and drove to the local movie theater. But 25 years ago this month, on October 26, 1985, all of that changed. On that day, the first Blockbuster video store opened its doors at the corner of Skillman and Northwest Highway, in Dallas, Texas.

By offering thousands of titles, at prices significantly lower than what it would cost to buy a ticket at the local cinema, Blockbuster changed how we went to the movies. For many of us, it was a Friday night ritual – walking up and down the aisles, scanning the latest offerings, and stocking up on a weekend’s worth of entertainment. At its peak, Blockbuster was valued at more than $8.4 billion. Earlier this year, there were over 6,500 Blockbuster stores, operating in 18 countries around the world. But two weeks ago, on September 23, Blockbuster filed for bankruptcy.

Once an icon of the home entertainment industry – it basically disappeared, right before our eyes.

How did that happen? Well, today of course, you can conveniently access almost any kind of entertainment from the comfort of your couch.

The technology has changed, and our habits have changed, but Blockbuster didn’t change in response, or at least it didn’t change fast enough. Instead, the folks at Netflix offered a different paradigm, and a different business model: deliver the videos by mail, or if you’d like, by streaming video to your computer, and all of a sudden, Blockbuster became irrelevant.

What does all of this have to do with commercial space transportation? Well, no matter what your business is, it helps to be nimble, responsive, and flexible. You need to keep pace with the times, or risk being left behind.

So I suspect that in addition to incorporating the latest technologies, successful aerospace companies in the years ahead will also need to continually assess their business case, their customers’ changing desires, the size and character of the market, and the nature of the competition.

When we last met in May, I told you that our nation’s future direction in space was getting a lot of attention, and that we were at the center. That was no exaggeration. There has been quite a debate, both on the Hill, and in the media. As we gather here today, there are still some open questions, but it’s clear that much progress has been made in settling on the final direction for the nation’s future in space.

And for those of us in the Office of Commercial Space Transportation, it has been a very busy time. Let me briefly review some of what we have been up to.

After reviewing their application package, we were able to issue a launch license to SpaceX for their new Falcon 9 booster, leading to a very successful first flight on June 4.

Later that month, the White House released a new National Space Policy, which we had helped to develop. It contains a number of provisions highlighting the importance of the commercial space sector, and challenging the federal government to take full advantage of the capabilities of our partners in industry.

In recognition of the changing nature of the space environment and an increased appreciation for the risks associated with orbital debris, our office was asked to lead an interagency effort to identify potential options for providing Space Traffic Management services. We are currently working with NASA, the DoD, the FCC, and several other agencies to figure out how best to accomplish that.

In August, the FAA announced a new Center of Excellence for Commercial Space Transportation. This is a public-private partnership, with government, industry, and academia working together to tackle problems of interest to the aerospace community. The FAA will be investing $1 million per year over the next 10 years in matching funds for the Center.

In response to the solicitation, we received a number of excellent proposals, and the competition was pretty stiff. In the end, the selected universities had the right stuff. New Mexico State University was chosen as the Administrative lead for the Center. Other members of the team include Stanford University, the University of Colorado, the University of Texas Medical Branch, New Mexico Institute of Mining and Technology, Florida Institute of Technology, and the Florida Center for Advanced Aero Propulsion. For us, establishment of the Center means a vital new partnership with the academic world and the chance to reach out in new directions. And the institutions which make up this consortium will expand our reach exponentially as they bring on additional partners from the private sector. NASA, the DoD, and other government agencies are also invited to participate.

On another front, based on a recommendation from Ray LaHood, the Secretary of Transportation, we are planning to create an FAA Commercial Spaceflight Technical Center at the Kennedy Space Center in Florida. The Center will have two significant benefits: it will allow the nation to continue to benefit from the contributions of a significant number of skilled workers that will be seeking employment in the months ahead, and it will allow the FAA and NASA to partner in developing an organization with a knowledgeable and experienced staff to regulate future commercial space operations.

As currently envisioned, the Center will have four focus areas: Spaceflight Safety, Spaceflight Engineering and Standards, Range Operations, and Space Traffic Management.

Depending on the available funding, the Center could employ as many as 200 people. We are prepared to hire them and put them to work immediately doing research, developing standards, writing regulations – all the things that can help enhance the safety of space transportation operations in the future. The White House Task Force on Space Coast Jobs strongly supported our proposal for the Center, and recommended that the FAA be given $5 million to open the doors and get things started. So as soon as Congress gives the OK, we’ll start posting some vacancy announcements and hiring the staff.

As you may know, every year the FAA gives out about $3.5 billion in Airport Improvement Grants. Well, last week, we announced the first-ever spaceport grants, which are designed to fund projects that will develop and expand commercial space transportation infrastructure.

Grants were awarded for four separate projects in Alaska, California, Florida, and New Mexico. Spaceport America will be getting funds for an automated weather observing system. The Alaska Aerospace Corporation will be building a rocket motor storage facility. Mojave Spaceport will be getting a new emergency response vehicle. And Cecil Field will be developing a Spaceport Master Plan. Although the amounts given out this year were relatively modest, we’re hopeful that the program can be expanded in future years.

In the licensing area, this has been a busy season as well.

In July we issued a launch site operator license to Space Florida. The following month we issued a license renewal to Orbital Sciences Corporation for conducting Pegasus launches from Vandenberg.

We recently inaugurated a Lessons Learned website – which will allow members of the commercial space transportation industry and interested members of the public to access and submit lessons learned pertaining to commercial space transportation activities and operations. By communicating this information to the members of our industry, we hope to enhance safety by learning from one another’s mistakes and by sharing best practices.

On the research front, back in May, we completed an aircraft vulnerability proof of concept test that we hope will eventually allow us to remove some of the conservatism that has traditionally been part of the calculation of aircraft risk assessments during launches.

We also just completed flying an experiment on a NASA sounding rocket – the first time an FAA-sponsored payload has flown on a NASA launcher. The experiment was intended to evaluate the potential for using the ADS-B system to enable routine operations of reusable launch vehicles in the National Airspace System.

So as you can see, there has been a lot going on over the past five months.

Today there is an excitement about the future of commercial space that is palpable among the group of professionals that I am privileged to lead.

I hope you share some of that excitement, and that it can be part of our discussions here this morning. As we take on a new set of challenges, your feedback and words of advice take on a new level of importance. We need your help in charting the right course for the future. We also need to know when you think we’re in danger of missing the boat.

So please keep talking to us. And thank you for all you do.