Personal Spaceflight Industry - Reflections on the Five Year Anniversary of the Ansari X PRIZE

By Peter H. Diamandis, X PRIZE Chairman & CEO

Today, October 4th, is the 5 year anniversary of the winning of the $10 million Ansari X PRIZE for spaceflight. The most important legacy and meaning of the Ansari X PRIZE on its five year anniversary lies in the fact that the event kicked off a new industry. In the same way that Lindbergh's flight across the Atlantic in 1927 is seen as an inception point for today's $300 Billion Aviation industry, I'm extremely proud that the Ansari X PRIZE has created a new personal spaceflight industry. Not only did these historic flights culminate in a beautiful exhibition in the Smithsonian, at the entrance to the National Air & Space Museum, but much more profoundly, the winning flights by SpaceShipOne kicked off the personal spaceflight industry which has had over $1Billion invested in it during the past 5-years.

On this day, I'm taking the liberty to reflect on key questions I've been asked over the years...

Ultimately what was the real value of the Competition?

I often think about the real value that the Ansari X PRIZE contributed to this field of spaceflight which I love so much. I think ultimately it gave teams around the world permission to dream, to assemble teams and dare to think about building private spaceships. By creating the structure of the competition, it validated the importance and the viability of private spaceflight. It defined a 'clear goal'... or a meaningful finish line that teams could pursue. As my friend and early X PRIZE founder Astronaut Byron Lichtenberg is fond of saying, "Without a target you will miss it every time!" We gave space dreams and entrepreneurs a target to shoot for.

Before the X PRIZE there really wasn't a generally accepted definition of where space begins... there was always three numbers thrown about, namely 50 kilometers, 100 kilometers and 162 kilometers (100 miles). In retrospect, I'm pleased that we picked 100 km, because it was "just hard enough"... and if we had chosen 100 miles (162 km) we might not be celebrating this 5 year anniversary!

The competition also created the public excitement, expectations, rooting interests and ultimately future customers who were lining up to buy a seat on these Ansari X PRIZE-class of spaceships.

I also feel that we played an important role in driving the regulatory policy that today allows private, reusable, piloted spaceships to carry paying passengers. Only a year before the prize was won, the rules were not defined and there was no clear way for such a ship to be licensed to fly. We worked closely with FAA Administrator Marion Blakey and Associate Administrator Patricia Smith to get the rules in place. Rutan had threatened many times to take his ship out of the country (I think he bluffed that he would launch from Mexico) if needed to fly since the US obviously didn't (yet) allow these types of flights. Remind me never to play poker against Burt!

Would this have happened anyway?

I have no doubt that eventually someone would have flown privately to space, just like someone would have flown across the Atlantic (in the case of the Orteig Prize and Lindbergh). But I do believe that the structure of the prize, the creation of a competition and the involvement of the public and the media helps to supercharge the paradigm transformation. As humans we have evolved to compete... it is in our genes and we love to watch a competition.

What are my big-picture thoughts on this five-year milestone?

The most important legacy and meaning of the Ansari X PRIZE on its 5 year anniversary lies in the fact that the event kicked off a new industry. In the same way that Lindbergh's flight across the Atlantic in 1927 is seen as an inception point for today's $300 Billion Aviation industry, I'm extremely proud that the Ansari X PRIZE has created a new personal spaceflight industry. Not only did these historic flights culminate in a beautiful exhibition in the Smithsonian, at the entrance to the National Air & Space Museum, but much more profoundly, the winning flights by SpaceShipOne kicked off the personal spaceflight industry which has had over $1Billion invested in it during the past 5-years.

There were a lot of X PRIZE competitors, but was there really a race? Was the Da Vinci Project or Armadillo really in the running?

When the X PRIZE was announced on May 18th, 1996 (before it was even called the Ansari X PRIZE), I knew of maybe three or four potential companies (teams) that might compete for the purse. I was shocked in the final result to have 26 teams from seven nations in the running. In retrospect, I would probably say that the 26 teams could be divided into three groups. The first group, about 1/3 of the field had a shot of building the vehicle... they had a strong design, a strong team and the money or the ability to raise the funding. The second group had a strong design, a strong team but lacked the real ability to raise the funds, and the final group were those who we registered, but were unlikely to ever make anything significant happen beyond their basic concept. We discussed in the early days the criteria for registration, and the conditions under which we would turn away teams. Gregg Maryniak would always remind us that we "didn't want to turn away those pesky bicycle mechanics from Dayton Ohio."

In retrospect, Burt truly had a commanding lead ahead of the pack. Both the Da Vinci Project and Armadillo were there as leading contenders, but had a significant way to go in their financing and construction. Regardless, I would always remind the media and remind Burt that Admiral Byrd (first person to fly to the North Pole in an airplane) was the leading contender for the Orteig Prize, but Byrd crashed on take-off and a somewhat unknown aviator, Charles Lindbergh, ultimately claimed the purse.

What would you have done differently?

As I think back to the Ansari X PRIZE, the one thing which I wish we would have done differently is to have offered a second place prize of some amount, perhaps $1M or $2M. Such a second prize would have kept the drive for other teams to continue their development. At this time, a number of the Ansari X PRIZE contenders, and new players that have come forward since them, are pursuing sub-orbital craft. For them the prize is the marketplace. But without the pressure of the prize and its deadline, these teams have relaxed pushing forward and have taken a much more measured course of development.

It's worth noting that when I asked Burt Rutan what he thought we should have done differently, his answer was a bit of a surprise to me. He would have preferred that we required three actual humans onboard the two winning flights rather than a pilot plus the weight and volume equivalent of the two passengers. Clearly the X PRIZE offered this alternative option (weight & volume rather than actual humans) as a safety measure. I think Burt would have wanted the excuse to ride in the back seat himself.

Now that several X PRIZE competitions have been launched, what makes a good X PRIZE vs. a not-so-good X PRIZE?

The X PRIZE Foundation and its entire team have learned a lot over the past 15 years. With a team of nearly 50 people, we've invested over 500 human-years into studying and learning about incentive prizes, what works and what doesn't. We've studied other great successes like the work done by DARPA, NetFlix, GoldCorp and more others. Recently I wrote a detailed paper called "Using Incentive Prizes to Drive Creativity, Innovation and Breakthroughs" (available on the X PRIZE website for download) which outlines the cumulative thinking on this matter. In summary I would say that a Great X PRIZE is one that is telegenic, clearly defined goal, simple to explain, addresses a market failure (or area that is stuck) and something that can be won by a small dedicated team.

How do you feel about Virgin Galactic?

The fact that the Virgin logo was on the side of SpaceShipOne on October 4th, 2004 was fantastic. To be honest, at the time, I was really somewhat angry that Richard Branson had pulled off yet another marketing coup and captured the prime real estate for the Virgin brand (we had originally wanted to have the Ansari X PRIZE logo in that spot). But I quickly changed my point of view. Clearly Richard and his entire team are the marketing geniuses. But in the days and years following the winning of the $10M purse, I've come to appreciate that having the Virgin brand on the ship that day was really a success for the X PRIZE as well. Had the SS1 flight only ended up as a museum piece and a historical story, it really would have been somewhat of a failure. It is the fact that the winning flights ended up creating an industry and the fact that this industry was born co-temporal with the winning of the prize that is great news. So thank you Richard, Will Whitehorn, Alex Tai for taking the risk and moving the industry forward!

What prizes are the X PRIZE operating today? What is their status?

Since the award of the Ansari X PRIZE, three additional competitions have been launched. Each of these is stretching our mission and our reach. They are:

How does the Lunar Lander Challenge, which may be reaching something of a climax this year, compare with the Ansari X PRIZE atmosphere?

I would be remiss if I didn't mention the amazing success of the Northrop Grumman Lunar Lander Challenge, a $2M competition that the X PRIZE operates in cooperation with NASA (who provides the $2 million purse). The competition is challenging teams to create a rocket that can launch a vertical takeoff and landing that achieves the total delta-v needed for a vehicle to move between the surface of the Moon and its orbit. What is amazing about this competition is the teams and what they have been able to accomplish with a small part-time team of people (typically 3 - 8) working on 5 or 6-figure budgets. While this competition hasn't had the visibility and historic significance of Ansari, I'm very much proud of what we are doing here. The four companies that are actually building and demonstrating hardware (nominally Armadillo Aerospace, Masten Space, Unreasonable Rocket and True Zero have been flying vehicles) are creating a cottage industry of propulsion engineers that will give us the experience base needed to fuel entrepreneurial spaceflight efforts. The engine, for example, being used by Armadillo in the NGLLC is the same engine that they will use to power their sub-orbital human carrying vehicles in the next 24 months.

What Space Prizes are you excited about going forward? What would you recommend to NASA's Centennial Challenges program?

We've thought about space prizes along the following lines:

Perhaps my favorite space X PRIZE and the one that I'm spending the most time promoting is what I call a "Beamed Energy Propulsion X PRIZE." If you stop and think about it, the form of propulsion used today hasn't changed in over a thousand years... since the invention of fireworks by the Chinese. Basically you burn (oxidize) a material in a tube, hot gases come out one end and the vehicle flies in the opposite direction. Sure our rockets have gotten bigger and more efficient, but the basic design remains unchanged.

The concept I'm excited about is demonstrating propulsion that uses a ground based energy source, typically high-energy directed microwave beams that are precisely aimed at a rocketship that absorbs the energy using it to heat a working fluid (typically hydrogen or water) that is then expended out of the nozzle. Such a system (which I believe is very feasible today) would revolutionize propulsion.

Draft guidelines for such an X PRIZE might look something like:

What future prizes are you interested in outside of space?

The prizes of most interest outside of the space realm are the following:

How does the X PRIZE Foundation and the recently founded Singularity University fit together?

Both organizations are focused on future breakthroughs. While the X PRIZE Foundation is in the business of clearly defining and articulating these challenges, the Singularity University (www.singularityU.org) is focused on attracting and educating the graduate students who will ultimately form the teams to competing in these future X PRIZEs.

How do the recent water-findings on the Moon affect the Google Lunar X PRIZE?

Today's launch costs are unfortunately extremely expensive. On the average it costs something on the order of $20,000 per pound to get supplies into low-Earth orbit (where the Int'l Space Station is located) and, optimistically 10x to 20x that cost, or approximately $400,000 per pound, to land something on the Moon's surface.

So the cost of transporting water to the lunar surface, or oxygen, or hydrogen is about $400,000 per pound or $25,000 per ounce... about twenty-five times the price of gold today!

Revealing water in significant quantities on the Moon could truly be a turning point in space exploration. Who will set up the first water mining plants? Given low-cost availability of water, hydrogen and oxygen, what type of off-Earth economies and exploration will this enable? The question is not too dissimilar to those questions asked when oil was discovered buried deep under the Earth or under the oceans. We eventually designed the technology to mine and extract this precious resource. It's what we do as humans and entrepreneurs.

I'm excited for all of the teams building vehicles for the Google Lunar X PRIZE. I think of these vehicles as a low-cost 'prospector' looking for information and valuable data. Perhaps equivalent to the picks & shovels suppliers for the California Gold Rush. Ultimately, everyone will benefit from low-cost lunar exploration and these Google Lunar Teams will be on the cutting edge of a new gold rush.

Given the success of the Ansari X PRIZE, are other organizations being to emulate the incentive prize model?

The success of the Ansari X PRIZE has proven that incentivized competition stimulates growth in industries that have the potential to benefit the entire world. As noted in a recent McKinsey & Company report, "prizes attract diverse groups of experts, practitioners, and laypeople - regardless of formal credentials - to attempt to solve difficult problems, dramatically expanding the pool of potential solvers and lower the cost of attempting or recognizing solutions." Further, "prizes highlight and elevate superlative behaviors, ideas, and achievements in order to motivate, guide, and inspire others. Identifying excellence remains the cornerstone of many prizes - the essence of their power to produce change."

Incentive prizes represent the future of philanthropy and driving breakthroughs. X PRIZEs offer incredible leverage (typically 10 - 40 times the prize purse is spent to win the prize) and efficiency (you only pay the winner).

You get what you incentivize. Incentive prizes work. Today there are now more than a dozen $1M or greater incentive prizes in a wide range of areas. There's no reason that a decade from now there might be well over one-hundred active multi-million dollar incentive prizes.