Main Engine Cut Off - T+168: SpaceX and ULA Win NSSL Phase 2

Episode Date: August 10, 2020

The long-awaited news is finally here! ULA and SpaceX have won the National Security Space Launch (NSSL) Phase 2 launch contracts from the US Department of Defense, which leaves Blue Origin’s New Glenn and Northrop Grumman’s OmegA out in the cold. I talk through what this means for each company and launch vehicle, and where things will go from here on all sides of the issue.This episode of Main Engine Cut Off is brought to you by 39 executive producers—Brandon, Matthew, Simon, Lauren, Melissa, Kris, Pat, Matt, Jorge, Brad, Ryan, Nadim, Donald, Lee, Chris, Warren, Bob, Russell, John, Moritz, Joel, Jan, Grant, David, Joonas, Robb, Tim Dodd (the Everyday Astronaut!), Frank, Julian and Lars from Agile Space, Tommy, Adam, and seven anonymous—and 398 other supporters.TopicsU.S. Department Of Defense > Contracts For Aug. 7, 2020Pentagon picks SpaceX and ULA to remain its primary launch providers - SpaceNewsAir Force to end agreements with Blue Origin and Northrop Grumman, prepares for launch contract protests - SpaceNewsULA, SpaceX Win NSSL Phase 2 Awards – SpacePolicyOnline.comHouse and Senate Make Progress on the FY2021 NDAA – SpacePolicyOnline.comNational Security Space Launch (NSSL) Phase 2 Launch Service Procurement (LSP) Request for Proposal (RFP) FA8811-19-R-0002 - GovTribeAir Force funding three new rockets to compete with SpaceX but only intends to buy launch services from two providers - SpaceNewsAir Force requests bids for space launch services, will select two companies in 2020 - SpaceNewsEpisode T+79: Orbital ATK’s OmegA, NASA’s Bridenstine - Main Engine Cut OffThe ShowLike the show? Support the show!Email your thoughts, comments, and questions to [e-mail] @WeHaveMECOListen to MECO HeadlinesJoin the Off-Nominal DiscordSubscribe on Apple Podcasts, Overcast, Pocket Casts, Spotify, Google Play, Stitcher, TuneIn or elsewhereSubscribe to the Main Engine Cut Off NewsletterBuy shirts and Rocket Socks from the Main Engine Cut Off ShopMusic by Max Justus

Hello and welcome to Main Engine Cutoff, I'm Anthony Colangelo, and we've got a long-awaited show today to get to. The news finally came out on the U.S. Space Force's National Security Space Launch Program. The Phase 2 launch service contracts have been awarded to ULA and SpaceX in that order. ULA getting 60% of the launches, SpaceX getting 40% of the launches. So I want to talk about the wins. I want to talk about who lost. But first, some context. Since this is a story we've been following almost the entire life of this

podcast. It's been many years in the making now. This is the contracting mechanism that is heavily used by the Department of Defense here in the U.S. They cover formerly Air Force launches, Space Force launches, National Reconnaissance Office, all sorts of classified military launches, National Reconnaissance Office, all sorts of classified military launches, and some unclassified military launches as well. Right now, SpaceX and ULA are launching what is called a Phase 1A. Phase 1 was the block buy of contracts back in the day that went to ULA. Those were flown on Delta 4, Delta 4 Heavy, and Atlas 5s.

Then when SpaceX came along after some bickering in court, and then SpaceX giving up the suit by letting, or the DoD, letting some more awards go out to competitive bids, phase 1A kicked off. And those are the launches that we're actually watching right now. GPS launches, the couple of geostationary launches that Falcon Heavy has coming up towards the end of the year and next year. And that'll run for a little while. And then phase two is a batch of 30 to 34 launches that'll be launched between 2022 and 2027. So the actual awards will go out between now and 2024 for those five years. And they haven't settled on an official number of launches yet, but they're thinking it'll be around that 30 to 34 number. So as originally sketched, phase two was always going to be a two provider win. So they're going to pick the best two launch providers

and one of them was going to receive 60% of the launches, one 40% of the launches. So that'll be approximately 20 launches for ULA, 13 to 14 for SpaceX, if these numbers hold as is. Now, all along, I have been expecting these two to be the winners, but I was expecting SpaceX to be the 60 percent winner. And from the looks of it, SpaceX was as well. Talk about that more in a second. But to give some background on how that decision was made, you have to look at the actual documents that were put out with the request for proposals. They always put out this document that is the evaluation criteria. And this was the source of some strife formerly in the program.

The original RFP had this clause in there that said the two offerors, when combined, that provide the best value to the Air Force. That was something that was protested by Blue Origin, I think Northrop Grumman with Omega. I guess I should mention the launch vehicles involved here. I'll do that in a second. The other two launch providers that didn't actually win protested that wording because it wasn't very clear as to what the evaluation criteria was. So that was scrubbed from the RFP and the document went out again in late December with the updated copy and the evaluation criteria there lays out exactly how they made this decision. So when it came down to it, they using this evaluation factor chart uh for the four providers that put their hat in the ring here so those were united launch alliance who will be flying the

vulcan centaur vehicle that they're still working on um it is a new vehicle that is uh using a lot of tech from the atlas days so centaur is getting an upgrade but it's the same basic centaur they're going to be using solid rocket boosters from northrop Grumman. Those are going to be flown on Atlas 5 in the next couple months, using a new version of the RL-10 engine on Centaur. So that's a little bit new, new revision of that. And of course, they're using the Blue Origin BE-4 engine, which is entirely new, new fuel in the first stage. So that's probably the biggest departure for Vulcan. But ULA is really pushing this line that they're going to have a bunch of this tech flown before Vulcan hits the launch pad. I believe that to varying degrees. I think maybe they're getting

a little bit, they're being looked at a little nicer than some others would be if they tried to make the same claims. SpaceX is bidding Falcon 9, Falcon Heavy, two things that are flying already. There are a couple of upgrades that they'll need to make to hit all of the things that they need to do as part of phase two. That includes a longer payload fairing, vertical integration at Launch Pad 39A out at Kennedy Space Center. Vertical integration in this case means the ability to take the payload fairing with the satellite or whatever the payload is inside, lift it while it's still in the vertical orientation, and mount it on top of the vehicle when it's in its upright orientation. That is different than what SpaceX does right now, where they do horizontal integration.

They integrate the payload onto the rocket while it's laying down, and then it's lifted up vertically on the actual launch mount. But there are some payloads that is typically the classified types, we assume spy satellites or something like that, that require being mounted vertically because of certain loads that they're not designed for to be able to hold themselves in that horizontal position and then be lifted into the vertical. So that's a new development that SpaceX is going to be working on as part of this. Some renderings came out a couple of months ago about what that would look like, along with the longer fairing that would be on top of Falcon Heavy. So those two things are

included here. Potentially, there could be a launch site for Falcon Heavy out at Vandenberg Air Force Base. They never actually converted their launch pad out at Vandenberg to be able to support Falcon Heavy. There was never any need for it. There's a very good chance that at least one of the things they're going to be bidding for in Phase 2 is a really big, beefy satellite that's going to a polar orbit that they can't pull off from Florida with this new polar corridor out of Cape Canaveral. So they could update the launch pad out at Vandenberg, which is, you know, kind of falling out of use, to be honest, for SpaceX. It'll pick up in the coming years as

they fly some of these missions. They could have to convert that to be able to use Falcon Heavy out west as well. The last two bidders, one was Blue Origin bidding New Glenn. That would launch out of Cape Canaveral right now. If they were to win this, I think they would have gotten a launch site at Vandenberg. That was sort of the clause for people that don't have a launch site out west. In ULA's case, they have the Atlas pad out west that they're going to use. And then the fourth bidder was Northrop Grumman

bidding their Omega launch vehicle. All solid first stage, second stage. And then they had an upper stage. So I guess that was technically, I don't remember if there was a second stage that was solid. I think there was. Then they had this upper stage that was hydro locks using an RL-10 engine, kind of like a mini Centaur to do the final insertion. And in a lot of cases, direct to geostationary orbit insertion as well. This was capable of a couple strap-on boosters to change the lift capacity of this rocket. There were going to be two different

lengths of the first stage, so they were going to start in the early days with an intermediate size and then add an extra segment or two to their solid booster that is the first stage. This is a vehicle that has been tossed out into the open for many years. Many cycles has always been, it never really panned out. Um, so that's, that's got a history behind it. Uh, and you can go back and listen. I did a show on Omega, uh, two years ago or something like that. Now that talked about, you know, how it fits in and I'm sure we'll get into some of that.

Uh, but that gives you the lay of the land for who these four providers were. One more thing, in the Omega case, much like New Glenn, if Omega was chosen, they would also, I think they were going to look to take over Space Launch Complex 6 out at Vandenberg Air Force Base. That is where Delta IV Heavy currently flies from. That'll be phasing out by 2023, and then someone else is due to take over that launch pad in the future. So the idea was if Omega or New Glenn were chosen, they would get that launch pad, I believe. I never heard that confirmed for New Glenn, but I suppose that it would make sense considering the size of New Glenn. Omega would also use, and I guess hypothetically still could use, Launch Pad 39B on Kennedy Space Center. That is where SLS would be launching from. Northrop Grumman took over one of the mobile launch platforms that is out at Kennedy Space Center, and they would actually stack the vehicle in the vertical vehicle assembly building. They would roll that out to 39B to be launched from there between SLS

missions. So that's something that's a major consideration for the flight rate of that vehicle, and I'm sure that had something to do with, you know, the capability that they were bidding for phase two here. So that's the lay of the land, and then we look at the evaluation factors. There were four different factors. Number one, technical. Number two, past performance. Number three, small business participation. That's the ability to have small businesses as suppliers. And number four, price. In all these government documents, they always have this chart and then they tell you the relative importance of factors. And it kind of comes out like a fancy word problem from a math homework that you did, you know, 20 years ago or whatever it was. But the TLDR version of the relative importance is that price is by far the least important factor when considered among this

chart. The technical factor is broken down into sub factors as well that map to the actual capability that you need to be pitching. So there's system capability generally, there's different categories of launches and payloads. There's category A and B, then there's category C, and then there's systems risk and mitigations, all those sub-factors of the technical score. So there's this very fancy chart, and maybe I'll make it the album art for right now. I'll take a little screenshot here while I'm talking so that you can see what this chart looks like. But this is what they were mapping things to. So in the case I mentioned, SpaceX got the 40%

of the launches, which was unexpected by me. I think everyone assumed that the company that was flying the vehicles that are currently active, everyone else is bidding new vehicles, would kind of be a shoo-in for that 60% mark. And it seems like leadership at SpaceX and maybe even some of the lower levels at SpaceX thought so as well. We have yet to see a statement by SpaceX on this award win and not even a tweet from Elon. So I think that goes to show you there's something happening internally there. There was a tweet by Tom Muller, who is no longer at SpaceX, that was fairly funny, that was like, wait, what, we got the 40%? So I think that tips the hand a little bit that there was some shock among SpaceX in this regard. But with these kind of big

announcements, you have to expect there's going to be protests in this day and age. There always are protests of these big awards. And what that means is from the Space Force's side, you have to be really, really rigid and have rock solid reasoning behind how you awarded this 60-40 split. So if they are relying solely on this chart about the evaluation factors, and they, with good reasoning, rock-solid reasoning, can show that ULA was a better fit for these things, right? Again, price is by far the lowest of the priorities in this factor chart. If they can show that they have a better technical score in enough areas, if they can show that they handle small businesses better, ULA typically relies more on subcontractors than I think SpaceX does, who leans more towards

the vertical integration. And when I use that term, we've got a double meeting here in the show, but they bring a lot in-house. They do subcontract out some things, but they bring a lot in-house as part of their process, which is one of the reasons they can keep prices lower. But if that's one of the performance benefits here, or if that's one of the evaluation factors here, then maybe that does give them a little bit of leverage over SpaceX in terms of ULA's fit for this program. ULA is fit for this program. Past performance is something that is, that one to me, I think might be the biggest thing that gets squabbled about because ULA, the company might have good past performance and has a really good track record with these kinds of launches, but they're flying a new vehicle. So if you want to talk about past performance about the company and about the

vehicle, those are different things and how should they be weighted, that really wasn't specified in this document, and that could be a huge point of contention. Again, a lot of this is going to come down to the reasoning behind this decision to have ULA get the 60%, have SpaceX get the 40%. A couple things that can't be considered for who gets that win. They can't consider from the Space Force's side, they can't consider the fact that ULA doesn't have a lot of other customers. They can't consider the fact that if we don't give them the 60 percent, that, you know what, maybe they wouldn't really stay in business as well as if that we gave them the 40 percent. That stuff is not listed in the

evaluation factors. So if that was used as a reasoning to give ULA the 60%, even if it was found in some email chain, if it was, you know, if they did a bunch of interviews with people and found that was a reasoning, that would be a real big issue for the Space Force and cause this whole thing to be overturned. So we'll see exactly what happens amongst ULA and SpaceX. I would not be shocked to see SpaceX protest the fact that they were given the 40%. For the other two, Blue Origin, Northrop Grumman, they put out statements that said, we are disappointed, we're waiting to hear the debrief from the Space Force because everyone gets a debrief about what they won or what they lost. I think pending that, we could see a protest from at least one of those if they

see some red flag in what they're debriefed about. But we'll talk more about those two in a couple of minutes. Let me focus on ULA and SpaceX a little bit because along with the announcement of the award, there were two or three missions given out, two to ULA and one to SpaceX as part of this initial announcement. So for ULA, they won US Space Force 51 and 106. Those are going to be launched in 2022, second and fourth quarter, respectively. Total price there is $337 million. SpaceX won at US Space Force 67, which would fly at the end of 2022 for $316 million. I did not read that wrong. $316 million as a contract award to SpaceX for a single launch, you might think. But if you read some of the fine print on this announcement, this is from the contract announcement from the Department of Defense.

This launch service contract includes early integration studies, launch service support, fleet surveillance, launch vehicle production, mission integration, mission launch operations, mission assurance, spaceflight worthiness, and mission unique activities for each mission. So they are bundling into this price the first year of all this extra stuff that comes with being part of phase two. And previously, we've heard Gwen Shotwell talk about how with Phase 2, there's a lot of things the Space Force wants, fleet surveillance being a big one,

so they've got insight into all of your vehicles and what's happening. When we had Philip Hargrove on the program just a couple of shows ago, we talked about the fact that even NASA Launch Services Program has insight into each of SpaceX's launches so that they can make good decisions going forward. I can only imagine what the Department of Defense is doing for these missions that are hundreds of millions, if not billions of dollars that they're putting on these vehicles. The amount of insight they're going to want into these vehicles is probably a lot. So I think in the case of SpaceX, you know, historically,

we've seen them, let's look at the NASA programs, for example, their original commercial cargo contract was very low, their original commercial crew contract was very low compared to the other competitors. And I think, you know, even to a certain extent, Gwen Shotwell has said that they wish they would have bid more for, once they saw what Boeing bid for Commercial Crew, which was up in the $4 billion range, and SpaceX was in the $2 billion range, that they wish they bid more because of how much work, you know, maybe they didn't really know exactly how much was going to be required from them, and they would have priced it differently having known that. We saw that when the second round of Commercial Cargo came up for the ISS,

their price actually went up because they're doing different things. They're making some upgrades, but they also now are used to the kind of stuff that they're doing with these bigger programs, and they can price accordingly to make sure that they can cover the work that's required of them. And that isn't raising the price of a given launch. It's actually being able to price out all of this other stuff that goes with it. I just read this whole list of other things that they need that are all worded in a very mysterious kind of way to us on the outside, but I'm sure mean a lot of things to people on the inside. But even from what we

know about, you know what I talked about, they're going to need a new payload fairing, they're going to build this vertical integration facility at 39A, potentially upgrade a launch site at Vandenberg Air Force Base. All of that stuff is unique, isn't needed for SpaceX's other customers, and is very expensive. So if that's something that is actually part of this process, if they're going to be bidding for this work, then they need to price that into their bid. And I think that's what we're seeing there. One source, I think it was a source that was quoted in Space News by Sandra Irwin, I believe it was, said that there was about $100 million in this first year to cover that kind of stuff. So to some people's ears, that sounds a lot like that old ELC payment that ULA would receive that we all fought about online for years, whether it was a subsidy, whether it wasn't. Maybe they're

back as a yearly fee in some regard, and people generally will be more accepting of that, given that it's bid out as part of this competitive process. Could be something we see some congressional bickering about, as we had in the past. So ULA has to be thrilled with this announcement. In many ways, I think this gives them a new lease on life, that they're going to be having this anchor tenant that's going to let them get their new launch vehicle up and flying. They're going to be building out Vulcan Centaur. I'm sure there are people elsewhere in the industry that are very thrilled that Vulcan will be happening. I think NASA, I'm sure, the amount that they've relied on Atlas V over the years, I think they're going to be pretty thrilled to see a more capable version of Vulcan Centaur. For ULA themselves, maybe this is a chance to revolutionize what they do over there.

You know, for years, since 2014 when Tory Bruno took over, he's kind of been swimming against the current. With the changing industry, the company itself was changing heavily. They're phasing out Delta IV. Delta IV Medium is now done flying. Delta IV Heavy has just a few flights left. Being able to drop all that carrying cost of that vehicle, I think, could change things in a pretty positive way. They're moving into this new vehicle that gets them off

RD-180s, the Russian engines that have caused congressional strife, but I'm sure that also comes with a huge overhead of payments. They can't be the cheapest things in the world. There's a lot of cost pressures they've been putting on their suppliers as well. You know, the price for the RL-10 has reportedly come down quite a lot. That's the engine they use on Centaur. They're going to be flying with two of them on Centaur V when Vulcan starts flying. So it's still not maybe the cheapest option out there. Like I said, they switched to these new solid rocket boosters. They used to use Aerojet Rocketdyne boosters. Now they're using Northrop Grumman boosters that they say they have a significantly better price on. So shedding all of that kind of legacy from the

previous 10 or 15 years of ULA, moving into a Vulcan-centric domain, that could change things for them. We'll see what their prices get down to for any individual mission. One of the big things that they say is that Vulcan will be much more cost competitive with others out there. But there's a lot of unknowns with where the industry is going. Certainly with New Glenn, that will be coming online regardless of whether they won this or not. That'll shake things up. Whatever SpaceX is going to be doing with Starship in the future will shake things up. And then we've got new vehicles around the world that are coming online as well. So in an era where there seems to be fewer payloads for these bigger boosters, but there are more bigger boosters, you got to see how that plays out. Will the demand really come along with it? Will people start taking

advantage of the existence of these big boosters, the more affordable prices of those? Who knows? That's yet to be seen. But for ULA, they can kind of focus on getting Vulcan online, focus on these next launches through 2027. And then, you know, I'm sure within a couple of years, there'll be some good indication for where the industry is heading and whether or not ULA has a place in the commercial market. Maybe they don't. Maybe they are just a military provider. They are a national project provider for launch. There is a place for that in the world as much as we want to argue about commercial competitiveness.

There's some stuff that's going to be unique to these bigger priority programs that there could be a specialist that does that. SpaceX is really good at having a commercial product that can also fly military missions. ULA is really good at having a military project that flies military missions, and is also really good at NASA and other high profile missions like that. And maybe that's okay. Maybe that's kind of how things shake out. That would let SpaceX keep their commercial prices very low. It would let the DoD do what they need to do. It's a really complicated world in this way. I think you can make comparisons to other parts of the industry, you know, whether nobody's getting on a commercial F-15 to fly to LA, you're getting on a 737. 737s could also be used to host radar and all these other sensors

that the DoD needs, but they're not specialized for fighting. So there's specialization that occurs in every industry. And maybe this is that divergence point where you've got more and more commercial providers, and then you've got some providers that can do both, and you've got some providers that can only do the DoD and other national projects of that sort. That could be a way that it goes yet to be seen in the future. All right, I want to get into New Glenn and Omega and where we could see those go and what the future holds for those two companies when it comes to launch. But before we do that, let's say a huge thank you to everyone who made this episode of Main Engine Cutoff possible. There are 437 of you supporting every single month. And Chris, one of our executive producers, recently said that I won't be able to say that anymore because, reminder, I'm about to have a child. We are

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All right. So the two companies that were left out of these awards and one related bit that I maybe should have mentioned up front with ULA. Previous to these phase two announcements, there were these launch service agreements that were given out. I need to check the date when these happened. But what happened here was these were awards given out in 2019, I believe it was. Maybe the tail end of 2018. I can't remember my timeline exactly. But these were the contracts that were given out to kind of incentivize the existence of competition for the phase two bidding. So they were development contracts for vehicles that could be bid as part of phase two and needed to be bid as part of phase

two to actually be able to get these awards. So the Air Force awarded $500 million to Blue Origin to develop New Glenn, $792 million to Northrop Grumman to develop Omega, and then ULA received $967 million for Vulcan Centaur. The one clause there is that all that money was not given up front. A certain amount was given per year, and it would go from that award date all the way through the initial launch in 2022 for the phase two award. But you would only receive the full amount of money if you were chosen for phase two. So I hope I didn't lose anyone. Bunch of money, couple hundred million dollars that would contingently be awarded from this point until your first launch if you are a phase two winner and you will receive the money up until you either win or lose phase

two and then the losers would be wound down and the winner would receive that development money up through the first launch so in the case of blue origin and northup grumman the dod is now in the process of figuring out where to wind down this work and where to turn off the money spigot. ULA will continue to receive that development money up through the first flight of Vulcan, so that's a nice boost for them to get that online. SpaceX didn't receive any of this funding, and they were mad about it, and their representatives in Congress were mad about it, and they were trying to find additional money that could be awarded. There was a thought for a while that there was trying to get this through in a bill that if you won phase two, but didn't receive

what was called the LSA award, the LSAs, that you would receive a $500 million payment. At that time, the idea being there, it would cover things in SpaceX's case, because they're the only ones that would apply to, it would cover vertical integration, the new payload fairing, the launch site at Vandenberg, the extra stuff they would have done with the LSA contract back in 2019. And that never made it through. So really, right now, it's just the fact that Blue Origin and Northrop Grumman are going to be losing out on a couple hundred million dollars of funding. I don't know exactly how much they've received to this point. I don't think that's really been quoted in any way, but it obviously was not the full amount, and I wouldn't be shocked

if it was, you know, a third of that. So, 100 and something million for Blue Origin, 250 million for Omega, for Northrop Grumman. That's kind of the ballpark, I would guess, for those LSAs. So, earlier I mentioned that we might see a protest from either Blue Origin or Northrop Grumman. That's kind of the ballpark, I would guess, for those LSAs. So earlier I mentioned that we might see a protest from either Blue Origin or Northrop Grumman. Let's leave that be for a little while. We'll circle back if we do get to that point. But for the next couple of minutes, let's do some analysis about where this leaves both of those companies, regardless of a protest. So let's just assume they lost out and the protest is overturned or never filed. Where do they go from here? New Glenn is the much more straightforward one. They have a ton of funding. Jeff Bezos just sold a billion dollars or whatever bazillion dollars of

stock from Amazon. Prices way up on their stock because of the pandemic. So he cashed out, assuming that some of that is going to go to Blue Origin. So they have sufficient funding to see New Glenn through. They have sufficient funding to see New Glenn through. They have sufficient desire to see New Glenn through. They have a lot of customers that have already signed up. They have something between seven and 10, maybe even more contracts that they've signed for launches on New Glenn.

And they have a hell of a roadmap for the future that requires New Glenn. Their launch pad is well underway. There's great photos of the construction of that. Their launch tower is enormous. It is a towering structure on the Space Coast. So they are well underway. I assume we're about a year and a half-ish, maybe two years from launch of New Glen. They have slipped a good bit into 2022, the last I heard from various places around the industry, the last I heard from various places around the industry, which is later than desired,

but not unexpected for a new vehicle. They've got this giant ship that's in Pensacola where they're going to land the first stages. So they're going to be fine on the New Glenn development front. The biggest question mark that I have for them is, you know, are they going to get a West Coast launch site? Are they interested in a West Coast launch site? Or are they only interested in it so far as the military launches are concerned? If they would have won, I would have assumed that they would get Space Launch Complex 6, where Delta IV Heavy is flying out of. That pad is going to be available in 2023, 2024, regardless. Maybe, depending on their plans at that point, they scooped that up because it's better to have real estate out at Vandenberg. There isn't much of it, especially for big vehicles. So if one's available, maybe you scoop it up. However, this week there was that announcement

from the state of California that they're going to try to develop some sort of commercial space launch infrastructure outside of Vandenberg or near Vandenberg. We'll see how that plays out. That could be a big thing, but they have a couple of years to decide on that. But that's the biggest question mark is, you know, are they going to continue to go after things that are attractive for national security launches? They're obviously going to be doing plenty of launches out of Cape Canaveral for, you know, their own projects that I'm sure we've yet to hear about for NASA missions, for commercial missions. I would not be shocked to see occasionally a non-Phase II Department of Defense award. I am sure there are people that might even be listening to this show at the National

Reconnaissance Office that are salivating over a seven meter giant fairing and what they could put inside of that thing seems pretty relevant to their interests. So I wouldn't be shocked to see some of those more one-off missions get flown on New Glenn. They're going to have those kind of customers that are going to be launching out of Cape Canaveral. If they need to go to polar orbits, while they could do the dogleg mission that, you know, we've been talking about this polar corridor out of Cape Canaveral. SpaceX is about to try it in the next month or two. New Glenn has a lot of payload margin, so they could certainly fly that. It wouldn't be the full 45 tons or whatever to low Earth orbit, but a significant amount of payload to polar orbit out of the Cape would be possible with a vehicle that big. So maybe it's not that important for them to get that West Coast launch site. But nonetheless, I think New Glenn will be fine. A little beyond that, for the Phase 3 awards that have been talked a lot about in Congress, those would start to be awarded in 2025-ish, with launches into the 2030s. There's been a lot of politicking specifically from the representatives

in congress from blue origins districts about keeping some of these other competitors around in the market until phase three starts because who knows where ula or spacex will be by the end of phase two so it would be and this is this is their words, not mine, I'm paraphrasing their thoughts. I might think a little differently about this. But it would be, you know, smart to keep these other companies around. So why don't we give them some money to continue developing in a way that would be useful for the Department of Defense by the time they get to phase three. So this would incentivize companies to not totally ignore the requirements of these DoD-type launches when they're building out their commercial services, and it would keep them relevant for the Phase 3 awards coming down the line. That seems like it might actually make its way into the National Defense Authorization Act this year, so we could see some actual movement on that in the coming months, but TBD where that goes exactly.

But regardless, I'm pretty confident that by 2025, New Glenn would be in the running for Phase 3 launches for the U.S. Space Force. I'm pretty confident they'll be there by 2025, and they'll be bidding for that next round of work. On the Northrop Grumman side, things are a little murkier for where Omega goes. It's not a single stick launch vehicle um that that has been a problem that has been talked about a lot especially you know when nasa was thinking about using a similar thing for crude launches back under the constellation program northrop grumman also says that they would be commercially competitive in terms of price um i don't know how true that is we obviously don't have a lot to say one way or the other, um, but it doesn't seem super true to me considering fully expendable vehicle, a bunch of different solids.

You're kind of dialing up this rocket size, expensive upper stage engines. Um, there's a lot of details there that don't necessarily sound the most commercially competitive to me. Um, but there was this one thing that I talked up a little while back was that Omega could be used as sort of a package deal for Northrop Grumman's servicing offerings. So they are a huge manufacturer of satellite buses.

Recently, we talked about the C-band issue here in the US where these satellite providers that have C-band customers that is being reallocated to 5G need to buy a bunch of new satellites. And Northrop Grumman sold a lot of satellites in that rush to get these things up in the next few years. They also have just started this mission extension vehicle, the satellite servicing wing of their business, and they're seeing good success with that. The first one is up doing its mission already. The second one is launching sometime this week, ideally, if that if that

Ariane 5 gets off. So it seems to be going well, they have a lot of customers signing up for that. Down the line, they've got this mission extension pod idea that are a little bit smaller versions of those mission extension vehicles. So they're pushing hard into satellite servicing. So there is a world in which they could sell this entire thing as a package deal and actually have it turn out to be a good business case. So maybe you go to Northrop Grumman and you buy a satellite bus and they launch it for you all as one price. But also on that launch, they put a mission extension vehicle or two to cut down their actual cost overall that they're using that launch, they put a mission extension vehicle or two to cut down their actual cost overall that they're using that launch for. So they're actually selling a launch, but also getting their own payload up that they could make money from in the future. And maybe that's enough

to close the business case. The thing that's dependent on is having enough launches to fill the manifest. And without an anchor customer like the National Security Space Launch Program, manifest. And without an anchor customer like the National Security Space Launch Program, can they get enough customers signed up to warrant the billions of dollars it would take to get this fully online and working? If the LSA was $792 million, maybe they've got another half a million dollars to get to first launch, to be able to sell a couple of these missions, to be able to start using this as a package deal? Do they have what it takes, both financially, but also maybe finding other investors, both that, but also the appetite for that kind of thing amidst a global pandemic that is wreaking havoc on the economy?

Is there the appetite for that? I'm not sure. It would be a couple hundred million dollars to get this thing up. And then it's dependent on there being enough of those customers out there to really feel that manifest. They do have internally to themselves, if they are going to take this and make it an internal project, they have the insight from that satellite arm to say, you know, here's our projections for how many satellites we're going to sell in the next couple of years. Maybe it turns out that they're able to sell the satellite bus and then a very discounted launch and still make enough money with that plus the mission extension vehicle that would be hitching a ride up. Maybe that business case does close even with two or

three launches a year. Northrop Grumman's launch vehicle arm, I'm thinking Antares, the Minotaurs, Pegasus, they seem to be able to survive on a ridiculously low launch cadence. It doesn't seem like they, maybe this is the point about why their vehicles are so much more expensive, but they don't seem to be as dependent on having a massive amount of launches per year as others in the industry do to keep their launch price where it is. So this could still pan out. I think it depends heavily on what they're predicting for satellite sales over the next decade or so. I wouldn't bet money on it, but I don't want to count it out entirely because I think it's interesting enough to consider what a

satellite bus plus two mission extension vehicles plus a launch vehicle could do for them in terms of a business case, if it's something that they're interested in. Certainly having your own ride to space is a really good thing as we're seeing SpaceX with Starlink. It's actually working out really well for them that they have their own launch service that is essentially paid for by other people sending up boosters that then they reuse. Turns out that's a really good idea. And maybe that's the whole reuse never pays off. I think we're seeing that proven wrong by all these Starlink launches. So for Northrop Grumman, maybe they would like having their own ride to space for the mission extension vehicle service. As the current crop of geostationary satellites age out, that's only going to get more interesting

for people that don't want to buy a whole new satellite. So maybe that is something that we could see pan out in the next couple of years. I'm really curious to see where that goes. I wouldn't bet money on it, but, you know, it could pan out. Now, also on the phase three front, with Blue Origin having its Congress critters pushing this idea to have phase three money for a third provider, that could backfire on Blue Origin and Northrop Grumman could actually win out in that department, which would be quite a thing. If Blue Origin's congressional, you know, maneuvering pans out to provide them another competitor, that would be certainly interesting to watch. So those are things to track for Northrop Grumman in the coming years.

I'm not a big Omega fan I'm not big on the idea that it's actually a good fit for the market but like I said I don't want to count it out because I could reason my way through a business case closing with just a handful of satellite launches that Northrop Grumman themselves probably knows better than I do so that's kind of where things are at right now with phase 2 hope you enjoyed this little thought process

got any questions or thoughts send them to me That's kind of where things are at right now with phase two. Hope you enjoyed this little thought process. Got any questions or thoughts, send them to me, anthony at mainenginecutoff.com or on Twitter at wehavemiko. Thanks again for all your support over at mainenginecutoff.com slash support. I will let you know when my child arrives. But until then, thanks for listening and I will talk to you soon. Bye.