In the first days of rocket enthusiasm, the third decade of the 20th Century, it was assumed that philanthropic millionaires would fund eccentric inventors to build rockets that would be flown by intrepid aviators into space. Guggenheim, Goddard, and Lindbergh became the template for Helius, Manfeldt, and Windegger in Frau im Mond or the unidentified backer, Zarkoff, and Flash Gordon. But fascism, communism, and the military-industrial complex took over development of the rocket to build ultimate weapons of mass destruction. The rockets designed to boost nuclear warheads on intercontinental trajectories between 1952 and 1962 became the basis for access to the cosmos. And because they were so fearfully complex, so incredibly expensive, and so subsidized by the government, there was no space for private entrepreneurs. Indeed, such entrepreneurs found themselves blocked at every turn by governments that seemed more interested in preserving monopolistic access to space than encouraging its private development.
But at the dawn of the third millennium, the old template was back. The Ansari family put up the X-Prize - a modest $10 million to the first private spacecraft to reach space (100 km altitude, suborbital). This was a conscious imitation of the sort of early aviation prizes that led Lindbergh to cross the Atlantic. Paul Allen, co-founder of Microsoft, staked outside-the-box engineer Burt Rutan the serious money needed to seize that prize . This was the breakthrough - private citizens could reach space at a tiny fraction of the cost of existing means.
Private investors, looking for the Next Big Thing, now showed interest. Allen and Richard Branson obtained other backers, and SpaceShipTwo is supposed to begin revenue service in a few years from a new commercial spaceport south of Truth and Consequences, New Mexico, just over the Sacramento Mountains from Goddard's old test range at Roswell. Following close behind is Blue Origin's New Shepard rocket, financed by amazon.com billionaire Jeff Bezos. This will take passengers on a true-rocket vertical-takeoff vertical-landing thrill ride to space from a private spaceport in West Texas. The Black Armadillo and Quad, modestly financed by millionaire Doom creator John Carmack, took a similar approach, and entered 2007 with good business prospects. Less money and less technical credibility were behind two horizontal-takeoff/horizontal-landing spaceplanes, Xerus and Rocketplane XP. Seemingly little more than concepts and CAD images were other entries such as Dream Chaser, Sea Star, and Altairis. The Romanian Stabilo provided a unique low-cost, low-tech method of taking a passenger to space. Technically it seemed quite feasible, but getting the funding together in the hostile European environment was another matter.
Orbital flight to space is a whole different order of magnitude than suborbital tosses. To reach 100 km altitude typically requires a vertical cut-off velocity of 1100 m/s at 40 km altitude. To reach orbit requires a cut-off velocity of 7800 m/s at 185 km altitude - over 4 times the delta-V, 7 times the cut-off velocity, and 20 times the energy. During the rush to launch swarms of (later-cancelled) small satellites to Medium Earth Orbit in the 1990's, there was a rush of schemes to reach space commercially and cheaply - Kistler K-1, Beal and so on. These all went bust when the market dried up. That market is not coming back.
But now there is a new impetus, the same one driving the suborbital rush - space tourism. This is a dynamic undreamt of in Goddard or von Braun's day. In the 21st century thousands of well-heeled tourists and extreme sportsmen pay tens of thousands of dollars per holiday to climb the world's highest mountains, trek through remote, exotic regions, dive caves and wrecked ships at the limits of human and technical endurance, ski across the arctic or clim sheer rock faces. Others spend even more building their own aircraft, including jet and rocketplanes. A few visionaries began to see in the 1980's that this could finally lead to a commercial justification for spaceflight. The other commercial uses of space, promised again and again ad nauseum by NASA since the 1970's - microgravity-produced drugs and materials - have never developed, despite government subsidies. There is just no financial case - yet - for such an industry, even at lower launch prices.
But tourism is already proven. The Russians led the way by offering whoever could pay the $20 million asking price a trip to the Mir space station. Tohiro Akiyama, a Japanese television reporter, was the first, in 1990, although his launch fee was paid by the Tokyo Broadcasting System. With the collapse of the Soviet Union, the Russians began accepting payments directly from capitalists who just wanted to buy a ticket to space. Tito, Shuttleworth, Olsen, and Ansari have had both the cash and desire to pay the price for a week aloft. The Russians have moved on to offer a trip around the moon with the Soyuz-derived DSE-Alpha - for $100 million. No takers have been reported yet…
But the market at this price - as has been proven - is limited to just a few dozen people on earth. The builders of the suborbital spacecraft are banking that there are thousands willing and able to pay between $100,000 and $200,000 for a few minutes of weightlessness and a view of the earth as a planet. Orbital tourism is another matter. Budget Suites millionaire Robert T Bigelow, acting on the theory, 'give them a place to stay and they will come', is financing inflatable space hotel modules, and offering a $50 million prize to the first private spacecraft to bring paying guests to orbit. Under its COTS program NASA has provided some seed money (or the kiss of death?) to two teams to build private boosters and crewed space capsules to provide access to the ISS in the absence of the space shuttle - the Falcon 9 / Dragon and the resurrected Kistkler K-1. These are the early contenders to take orbital space tourists to Bigelow's orbital Budget Suites.
On the horizon, if the suborbital market proves to exist, would be a SpaceShipThree, a presumptive Blue Origin vehicle using the New Shepard as a first stage, and a host of conceptual vehicles such as the Dream Chaser orbital version and Neptune.