In a June 3rd article in The Economist entitled, "Can America keep its innovative edge? ," the magazine suggests that those who call for government-directed innovation are more likely to produce failures rarther than success.  This sentence summarizes this view:  "... think twice before creating a federal innovation agency, which would do more harm than good by backing technologies that consumers might not want. And as for funding research into the services sector, leave that to firms like IBM and EDS—American companies that practically created the market and now dominate it."

Remember Lockheed Martin's ill-fated VentureStar, cancelled in early 2001 after $1.5 Billion was spent over five years in a government- (rather than free-market) directed effort to build a single-stage-to-orbit (SSTO) Reusable Launch Vehicle?

NewSpace has learned from that debacle.  Can NewSpace lead America's innovative edge? 

Two very important lessons came out of VentureStar, and the NewSpace industry has adopted these.  SpaceX Corp., XCOR Aerospace, Armadillo Aerospace, Blue Origin, The Spaceship Company, Masten Space Systems, and other developers of sub-orbital and orbital launch vehicles have not proclaimed their allegiance to a single design or mission profile.  Nor have they all jumped on the SSTO bandwagon.  Why?  Each is responding to their targeted markets and has chosen what they view as economically viable technology that will get the job done safely and earn a profit.

With sub-orbital space tourism flights likely to begin in a few years, many have derided this as nothing more than a plaything for the wealthy (conveniently forgetting that new products are usually affordable only by the wealthy until competition kicks in).  This attitude also excludes the value of “venturesome consumption,” as described in the article:

... R&D is not the only driver of successful innovation. In a book to be published later this year Amarnath Bhidé, a professor at Columbia University, argues that what matters in today's global economy is not where an idea comes from, but how fast a country's firms and consumers are willing to try it out.

And America is outstanding at what Mr Bhidé has dubbed “venturesome consumption”. Many popular American gizmos, such as Apple's iPod and Dell's computers, are chock full of the latest technologies from overseas.

If competition is the engine of NewSpace, then surely "venturesome consumption" is its fuel.