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Corporate Initiative for Space Tourism

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UNIVERSITY OF LJUBLJANA FACULTY OF ECONOMICS MASTER’S THESIS “OUT OF THIS WORLD” BUSINESS: CORPORATE INITIATIVE FOR SPACE TOURISM Ljubljana, March 2014 JAN KRIŠTOF RAMOVŠ AUTHORSHIP STATEMENT The undersigned Jan K. Ramovš, a student at the University of Ljubljana, Faculty of Economics, (hereafter: FELU), declare that I am the author of the master’s thesis entitled “Out Of This World” Business: Corporate Initiative for Space Tourism, written under supervision of Prof. Dr. Metka Tekavčič. In accordance with the Copyright and Related Rights Act (Official Gazette of the Republic of Slovenia, Nr. 21/1995 with changes and amendments) I allow the text of my master’s thesis to be published on the FELU website. I further declare the text of my master’s thesis to be based on the results of my own research; the text of my master’s thesis to be language-edited and technically in adherence with the FELU’s Technical Guidelines for Written Works which means that I o cited and / or quoted works and opinions of other authors in my master’s thesis in accordance with the FELU’s Technical Guidelines for Written Works and o obtained (and referred to in my master’s thesis) all the necessary permits to use the works of other authors which are entirely (in written or graphical form) used in my text; to be aware of the fact that plagiarism (in written or graphical form) is a criminal offence and can be prosecuted in accordance with the Criminal Code (Official Gazette of the Republic of Slovenia, Nr. 55/2008 with changes and amendments); to be aware of the consequences a proven plagiarism charge based on the submitted master’s thesis could have for my status at the FELU in accordance with the relevant FELU Rules on Master’s Thesis. Ljubljana, _______________________ Author’s signature: ________________________ TABLE OF CONTENTS INTRODUCTION .................................................................................................................. 1 1 DEVELOMPENT OF SPACE TOURISM ........................................................................ 4 1.1 History of Space Tourism ............................................................................................... 4 1.2 From Space Industry to Space Tourism .......................................................................... 6 1.3 XPrize Foundation .......................................................................................................... 8 1.4 Sub-orbital Design ........................................................................................................ 10 1.4.1 Virgin Galactic & Scaled Composites ................................................................... 10 1.4.2 Space Expedition Corporation & XCOR .............................................................. 12 1.4.3 Other Noteworthy Developments .......................................................................... 14 1.5 Orbital Design............................................................................................................... 16 1.5.1 Space Exploration Technologies Corporation – SpaceX ....................................... 16 1.5.2 Bigelow Aerospace & Orbital Technologies ......................................................... 18 1.5.3 Noteworthy Developments .................................................................................... 20 1.6 Spaceports ..................................................................................................................... 21 1.7 International Agents ...................................................................................................... 23 1.8 Obstacles to Space Tourism .......................................................................................... 24 1.8.1 Major Obstacles ..................................................................................................... 24 1.8.2 Minor Obstacles ..................................................................................................... 26 2 BUSINESS OF SPACE TOURISM .................................................................................. 27 2.1 Investors........................................................................................................................ 29 2.2 Space Tourism Regulation ............................................................................................ 30 2.3 The Demand for Space Tourism ................................................................................... 32 2.3.1 Futron/Zogby Survey ............................................................................................. 33 2.3.2 Incredible Adventure’s Study ................................................................................ 34 2.3.3 Ipsos’ Market Research ......................................................................................... 36 2.4 Strategy for Space Tourism .......................................................................................... 38 2.4.1 Pricing Strategy for Space Tourism ....................................................................... 39 2.4.2 Risk and Insurance Considerations ....................................................................... 42 2.4.3 Public Relations & Marketing ............................................................................... 44 2.5 Design of Space Tourism .............................................................................................. 46 2.5.1 Preparation ............................................................................................................. 47 2.5.2 Voyage ................................................................................................................... 50 2.5.3 Return .................................................................................................................... 54 2.6 Potential Advancements ............................................................................................... 55 3 CONTRIBUTIONS OF SPACE TOURISM ................................................................... 58 3.1 Economic Growth ......................................................................................................... 58 3.1.1 Launch cost minimization ..................................................................................... 59 3.1.2 Employment .......................................................................................................... 60 i 3.1.3 Advantages from tourism ...................................................................................... 63 3.1.4 Industry creation and expansion ............................................................................ 64 3.1.4 Western technological competitiveness ................................................................. 65 3.2 Societal Implications .................................................................................................... 66 3.2.1 Medical benefits for society .................................................................................. 67 3.2.2 Increased standard of living .................................................................................. 68 3.2.3 Poverty and crime reduction ................................................................................. 70 3.2.4 Global consciousness awakening .......................................................................... 71 3.3 Environmental Impact .................................................................................................. 72 4 SPACE TOURSIM FOR “OUT OF THIS WORLD” BUSINESS ............................... 75 CONCLUSION ..................................................................................................................... 77 REFERENCE LIST ............................................................................................................. 80 APPENDIX ii LIST OF FIGURES Figure 1. Images of SS2 and WK2 ...................................................................................... 11 Figure 2. The Lynx .............................................................................................................. 13 Figure 3. SpaceX's Dragon Capsule .................................................................................... 17 Figure 4. Future Russian space habitat ................................................................................ 20 Figure 5. Existing and proposed global spaceport ............................................................... 22 Figure 6. Results of the milionaires' market study .............................................................. 34 Figure 7. Pricing strategy for monopolistic (left) and oligopolistic (right) markets ........... 40 Figure 8. Shows price skimming strategy ........................................................................... 41 Figure 9. The voyage plan of Virgin Galactic ..................................................................... 51 Figure 10. The voyage of SXC's Lynx 2 ............................................................................. 52 Figure 11. Open cell foam mechanical counter-pressure concept ....................................... 56 Figure 12. International tourism arrivals projection ............................................................ 63 Figure 13. Zero Emissions Hypersonic Transportation ....................................................... 65 Figure 14. Wealth creation cycle ......................................................................................... 71 Figure 15.
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