&gt; Even if ULA dramatically cut their costs to drive SpaceX out of business, that will stimulate a huge surge in demand for launches.<p>If only that were true.  It does happen in many markets, but not currently in the space market.  Space is still in the early-stage &#x2F; chicken-and-egg mode.  A bit of simple value chain analysis shows why.<p>TL;DR: we may be closer than I think to the space business moving into traditional economics, but even then it&#x27;s probably decades out.<p>There are three disjoint space markets:
 - military: largely price insensitive; volume unknown to me but not enormous; has specialized needs so a lot of it couldn&#x27;t be satisfied by COTS launch systems
 - science: some of which (earth sensing) can use COTS, the rest is low volume, has non-commercial requirements (e.g. non-LEO) and often has weird timing constraints depending on what the orrery says.
 - commercial, which is what we all want to explode in volume!  Today this is 100% LEO.<p>Science is largely the space side of NASA and I personally am convinced congress only funds in order to provide enough economic volume that the contractors are available to support the military.  I.e. a fig leaf for the military just like the DoE (whose hands are all over space science as well).<p>So commercial: the chicken and egg problem the compound of two (used to be three, see below) issues: launches are rare and expensive, so satellites are few and far between, which makes them expensive, which doesn&#x27;t encourage volume, which doesn&#x27;t encourage launch capacity development, which keeps them expensive...  This is one of the reasons why previous private efforts (e.g. Rotary Rocket) have foundered.  Despite what my libertarian friends say, it&#x27;s almost impossible to break out of this trap without government incentive; the activation energy is too high.<p>Now almost is not the same as 100% and this is where I&#x27;d like to believe and agree with you.  And I do agree, except the time base I believe in is too slow to support the phrase &quot;huge surge in demand&quot;<p>One thing that has been great is the folie à deux on the part of billionaires Bezos and Musk (I believe that SpaceX and Zip2 are the only companies Musk actually founded, right?) has allowed ego to try to break that cycle for LEO applications.  Unless Google or Apple or Amazon can start pumping out satellites for internal use in high volume the overall market will grow slowly (who else is likely to buy a lot of satellites?  I&#x27;m not sure).  And even so that effort will take time to ramp up.  If not...hard to see who will take up the slack.<p>I also look forward to non-LEO applications, like mining.  It has its own bootstrap problem.