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T-minus 10, nine, eight, seven,
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six, five, four, three, two, one--
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The space race isn't just global superpowers
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duking it out for bragging rights
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and technological supremacy anymore.
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Private companies, lots of them,
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are rushing to commercialize not just the final frontier,
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but the act of getting there.
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I am a sports guy, this is like March Madness to me.
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It's one and done, I got one shot to get to the end
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or else I'm either gonna fail, run out of money,
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or be gobbled up by someone else.
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And whoever figures out
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how to make launch safe, affordable,
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and convenient is going to take the next giant leap.
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We choose to go to the moon in this decade
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and do the other things,
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not because they are easy, but because they are hard.
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60 years into the space race,
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the way we leave Earth has changed remarkably.
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Zero, all engine running.
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Liftoff, we have a liftoff, 32 minutes past the hour.
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Space seemed like a vast, black desert,
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but now we're ready to make the desert bloom.
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I'm talking about opening space up to business,
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to private enterprise.
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Opening space up to commerce
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and experimentation and development.
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Why?
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To improve the quality of life on Earth.
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25 years after Ronald Reagan
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signed the Commercial Space Launch act,
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the desert has begun blooming.
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I think if you're a young person in 1969
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and you saw people walking on the moon,
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and 50 years later, we still haven't gone back,
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I think that's a little disappointing.
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I think they took that, their hopes and dreams
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of their youth, and are applying it to today's marketplace.
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And I think they're having a fantastic success.
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In the world of rocket launch,
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there are two very distinct races going on.
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The first are the large rocket companies
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like SpaceX, Virgin Galactic, and Blue Origin.
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Jeff Bezos has reportedly invested billions
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already in Blue Origin and will invest billions more.
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Liftoff.
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SpaceX has also raised billions of dollars
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and acquired very large contracts from NASA as well,
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in order to fund both development and operations
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of its vehicles.
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Liftoff of the SpaceX Falcon-9 rocket.
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But they aren't the only players in the game.
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There's a heated race picking up
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between small and medium launch companies.
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There's a subset of the community
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not named SpaceX, not named Blue Origin,
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trying to figure out, okay, how we get there fast?
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Companies like Rocket Lab,
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Relativity, Firefly, and Virgin Orbit.
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Right now, there are more than 100 small launch companies
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competing not just to get to space,
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but to see who can get there most reliably,
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cheapest, and then repeat it over and over and over again.
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And ideally, end up with their business in the black.
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Because in time, new industries rely
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on these launch companies getting payloads into orbit.
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And any missteps can spell disaster.
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Not just for a rocket, but an entire company.
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There is a $200+ billion commercial space industry
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right now today.
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There are a couple of huge markets
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that have been very profitable.
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The most profitable is the satellite industry.
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In 2018, the global space economy was estimated
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to be around $360 billion.
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$277 billion of that is the satellite industry,
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which has actually grown over $100 billion
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over the past decade.
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And for those satellites to get to space,
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they need to be launched on a rocket.
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Global launches in 2018 increased by 46%
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over the number of launches a decade ago.
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In many respects, it's never been easier
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to put a satellite into space,
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in terms of the cost and the availability of rockets
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to ride into orbit.
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And a new era of smaller, cheaper satellite technology
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is creating this boom.
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Once a year,
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out in a desert north Utah,
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the Small Satellite or SmallSat Conference, comes to Logan.
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It has all the trademark features of an industry trade show,
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bright lanyards, tons of swag,
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but the deals happening here are carving out
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what the future of the space economy will look like.
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I've been coming to this conference for 20 years
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and seen it grow from 300 people to over 3,000.
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So, it is exciting to see that transition
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as we move into the next phase.
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Traditional satellites are often
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powerful behemoths, the size of school buses,
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costing hundreds of millions,
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if not billions of dollars to build.
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Today, the proliferation of smallsats,
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CubeSats, even nanosats,
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can cost as little as $10,000,
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and can be built with similar hardware
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that goes into your cell phone.
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They range from the size of a Rubik's Cube
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up to about the size of a dorm room refrigerator.
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And so that's a big difference.
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And so, some of these launch ventures
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want to launch a few dorm-size refrigerators,
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and others want to launch dozens of CubeSats.
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And so, they're trying to divide the market that way.
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Those satellites are providing imaging of the Earth,
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they're potentially providing telecommunications services,
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and they're attracting quite a lot of investment
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in 10s, hundreds of millions of dollars,
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even billions of dollars.
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The Earth's insatiable need for communications
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and internet is really what's driving
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this huge number of satellites that are going into orbit
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in the next five to seven years.
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There's gonna be thousands, if not 10s of thousands
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of new satellites in orbit in the next five to seven years.
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The question is, are they able to actually provide
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business services that will be successful?
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The idea is that entirely new
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business models as well as revenue streams
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will be propped up by the data these smallsats collect.
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The imaging and data collected from these smallsats
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will be used by everyone,
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from hedge funds to telecom giants to the US government.
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Just think of how much the photos you can get
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with your Android or iPhone have improved
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from the first generation to the current generation.
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Similar things happening in smallsats.
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Market research says smallsat manufacturing
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will nearly double by 2020,
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with nearly 8,000 new smallsats in space by 2026.
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The issue is always, small satellites have
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a lot of capability, but there's not a good,
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affordable way to get them into orbit.
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And that's where the small launch companies
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see a promising business.
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The fact that a small launch vehicle
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is much cheaper in total than a large launch vehicle
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on the order of five or $10 million,
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as opposed to $50 to $100 million,
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and there are more customers.
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Say you have a smallsat
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that you want to launch into orbit.
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Think of the big companies like SpaceX as a bus,
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and the small and medium launch companies
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like Rocket Lab as a taxi.
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With large launches, you're at the back of the bus,
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after the needs of what's called the primary,
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which is the main payload on the rocket,
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like a big government satellite.
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Your smallsat is just piggybacking off that primary
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since they bought the majority of the rocket.
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With small launchers like Rocket Lab,
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you and your smallsat can dictate
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more of your terms on when and how you'll fly.
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And you'll pay for the whole ride.
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So booking a taxi for a smallsat
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gives you more flexibility about when
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and exactly where you want to go into orbit.
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But it's more expensive.
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Sometimes a ride share on a big rocket
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and the chance to save on your launch expense
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is more suitable depending on the satellite,
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its mission, and the budget.
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Far more important is the orbital inclination
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or the angle of the satellite's orbit
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relative to the equator.
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It's much easier to move a satellite
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into a higher or lower orbit than to change its inclination.
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And that's why all launch customers
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have to decide how their mission priorities
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and budget can align when choosing how to get to space.
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It's getting to the point that hitching a ride
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on the really big rockets,
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it works for some people,
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it doesn't work for all business cases.
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And so you've got smallsat ventures that say,
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we want our own rides.
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Those customers will determine
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which of these small rocket companies succeeds
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and which of the companies will fail.
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This is not the internet,
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where you build up a huge userbase
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and then you figure out how to monetize them later.
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Launch doesn't work that way.
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You've gotta built up a backlog of customers.
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Out of the more than 120 small
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and medium-size launch companies out there,
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just one is successfully launching rockets
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for customers right now.
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And that is Rocket lab.
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People can actually walk on up to us and we'll fly them.
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That's a great competitive advantage to have over,
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you know, folks that are still developing a vehicle.
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Peter Beck's Rocket Lab has raised
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over $280 million from outsider investors,
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with a valuation of more than one billion dollars,
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and is currently flying a rocket every 30 days.
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It looked what the hardest thing to do
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was to go from zero to first successful orbital flight.
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But really, going from first successful orbital flight
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through to producing one every month
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has been an equal amount of stress and energy
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and complexity and toughness.
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We obviously, we've completed our test flights,
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and moved into full commercial operations
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with the first flight of its business time.
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And then straight on the heels of that,
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we flew our NASA mission, and now we're, you know,
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we're building and launching one vehicle
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every sort of 30 days, every month.
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And while other rocket companies
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are looking to build their customer base,
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Rocket Lab can't meet the rising demand for launches.
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Our biggest issue is we can't broaden out profits.
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That is our challenge.
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We've built four and a half acres of new factories
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and, you know, we're pushing in every direction we can
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to build more capacity.
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We fear that there aren't, you know,
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we are the only dedicated solution available
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on the marketplace right now.
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You know, at an affordable price.
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And so, what we see, a tremendous amount of demand.
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So the demand is there, that's not the issue.
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The issue is figuring out how to provide reliability,
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scale, and cadence, while keeping prices as low as possible.
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And each company has its own approach.
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Every company has a unique way to building their rocket.
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You know, whether they're using liquid,
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solids, fuels, or a combination of the two.
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Whether they're 3D printing their stages,
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everyone has their unique approach to getting to a rocket.
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However, the bottom line is good business in space
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is exactly like good business on Earth.
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A focus on customers, incremental successes,
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and a vision that's supported by a real business model
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is what works in space, just as it works on Earth.
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One of the companies who believes
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they have a successful business model is Firefly,