(Source: Virgin Galactic/Clay Center Observatory)
Full commercial launch will kick off next year, offering up $200-250K suborbital flights on its 6-passenger plane

After more than a decade of development, two major craft designs, and dozens of manned launches, the company that pulled off the world's first private spaceflight is less than a year away from its goal of creating a commercial suborbital space tourism business.

I. Mojave Aerospace Ventures Made Winning the $10M Ansari X Prize Look Easy

The story of SpaceShipTwo and Virgin Galactic began in 1996 when Microsoft cofounder Paul Allen met Burt Rutan, an aerospace engineer known for his renegade unorthodox designs.  By then, Mr. Rutan was already an iconic figure in the aerospace industry having convinced corporate aerospace investors to back his firm, Scaled Composites. In Mr. Allen's book Idea Man he recalls, "Burt had already begun thinking about a supersonic plane that could fly above the atmosphere."

It took four more years for Mr. Rutan to come up with his plan for the suborbital flier -- an air launched spacecraft with feathered wings for a gentle reentry into the Earth's atmosphere.  Two years later Allen put his money where his mouth was, putting up the cash to launch Mojave Aerospace Ventures LLC (MAV) and making Mr. Rutan its minority owner.

Burt Rutan and Paul Allen
Burt Rutan, right, and Paul Allen [Image Source: AP]

At first, MAV declined to target the X PRIZE -- a competition to send a 3 passenger craft on a suborbital flight to the "edge of space".  But in 2003 when the price got funding (to be finalized in 2004) from venture capitalists Anousheh Ansari and Amir Ansari, MAV decided to go for the gold, expanding their SpaceShipOne design from a one-passenger to a three passenger craft -- a design shift that increased the projected cost from $9M USD to $19M USD.  Paul Allen recalls, "Based on what I’d heard about bleeding-edge aircraft, I expected SpaceShipOne to come in overweight, underpowered, over budget, and behind schedule."

SpaceShip One design
An infographic explaining SpaceShip One's mothership launch and feathered landing mechanism. [Image Source: Scaled Composites]

But just two years after beginning work in 2001, Mr. Rutan had delivered a near finished craft.  Just slightly over budget (with an estimated development cost of $25M USD), the craft completed its first manned test flight in July 2003, launched from the Scaled Composites White Knight mothership. 

SpaceShip One X Prize
SpaceShip One hit X Prize gold in 2004. [Image Source: Scaled Composites]

By Dec. 2003, the craft had achieved supersonic flight, and on its sixteenth manned flight on Oct. 4, 2004, piloted by Brian Binnie, the craft achieved suborbital flight.  Climbing to 112 kilometers above the Earth, SpaceShipOne reached a speed of Mach 3.  The flight fulfilled the criteria of the Ansari X Prize, scoring MAV $10M USD.

II. "The Space Company" is Born

Following that success billionaire space dreamer Richard Branson jumped at the opportunity to turn the success into a money-making commercial venture, the likes of which the world had never seen.  Scaled Composites (with funding from Paul Allen) partnered as the minority owner (30 percent) in a new venture called "The Spaceship Company", which was majority owned (70 percent) by Richard Branson's 2004 creation, Virgin Group Ltd. subsidiary "Virgin Galactic".

The billionaires club of Paul Allen and Richard Branson put their financial brawn behind Burt Rutan's brains and soon a new mothership (White Knight Two) and space plane (SpaceShipTwo) were made.  In July 2008 the first mothership and plane were rolled out.

The White Knight Two bumps its predecessor's payload capability from 3,600 kg to 17,000 kg (~37,500 pounds).  

White Knight Two
The White Knight Two, aka the Virgin Mothership (VMS) [Image Source: Virgin Galactic]

Dubbed the Virgin Mother Ship (VMS) Eve (after Mr. Branson's mother), the craft first took flight in 2008 and underwent extensive testing the next year.

VMS EveVMS Eve, a White Knight Two mothership [Image Source: Virgin Galactic]

Meanwhile the SpaceShipTwo (SS2) was undergoing unmanned ground testing.  Then in 2010 the VSS (Virgin SpaceShip) Enterprise, the carrier craft successfully flew in March 2010 to 43,000 feet.  The next two years the VSS Enterprise completed 26 test flights to test its feathered glide mechanics.

Virgin Galactic SpaceShip Two
Scaled Composites' SpaceShip Two, aka the Virgin Spaceship (VSS) [SS2]

Northrop Grumman Comp. (NOC) is now peripherally tied to the project, as well, having bought out the majority ownership of Scaled Composites in July 2007.

III. SpaceShipTwo's Rocket Testing Continues

In 2013 the craft was fitted with its new rocket engine and this April it saw its first supersonic test.  

SpaceShip Two
The VSS Enterprise achieved rocket flight this April. [Image Source: Virgin Galactic]

And last week -- on Sept. 5 -- SpaceShipTwo achieved supersonic flight hitting mach 1.43 during its climb from its release point at 42,000 feet to 69,000 feet (21 km) over the Mojave Desert.

The company reports:

In addition to achieving the highest altitude and greatest speed to date, the test flight demonstrated the vehicle's full technical mission profile in a single flight for the first time ... All of the test objectives were successfully completed

Virgin Galactic

VSS Enterprise 2

VSS Enterprise

VSS Enterprise

VSS Enterprise
Images from the second test launch. [Image Source: Virgin Galactic]

Richard Branson adds in a blog post:

Virgin Galactic is now gearing up for the commercial service, finalizing cabin interiors, flight suits, training programs and the multiple other details required to offer hundreds of aspiring astronauts a safe and awe-inspiring journey.

SpaceShip Two's second flight
SpaceShip Two pictured in its second rocket flight [Image Source: Clay Center Observatory]

He confirms that the US Federal Aviation Administration (FAA) has cleared Virgin Galactic's flight license application for review, a major step towards getting permission from the U.S. government to conduct commercial flights next year.

IV. A Profitable Business?

With $400M USD in development costs, SpaceShipTwo has fulfilled Mr. Allen's original predictions of dire cost overruns (the original cost of development was estimated at $108M USD) [source].  

But Richard Branson and his partners are convinced the venture will eventually yield big products, fulfilling the dreams of many wealthy customers to experience spaceflight.  The SpaceShip Company has created a plant in the Mojave Desert and has already produced the second of five additional SS2 crafts.  An additional three White Knight Two motherships are also scheduled for production.  And they've created a thriving spaceport affiliated with the Mojave Airport, with a much larger port dubbed "Spaceport America" coming to the New Mexico's desert.

Mojave spaceport
Spaceport America, located in the Mojave Desert aims to be a thriving space tourism hub.
[Image Source: Spaceport America]

Looking ahead the SS2's first suborbital flight test is scheduled to for December 2013.  Assuming success, Virgin Galactic plans to in 2014 official launch its commercial spaceflights.  Richard Branson has said that Virgin Galactic is planning for 50 to 100 spaceflights in 2014 and 2015, carrying up to 600 passengers.

At last count Virgin Galactic has already booked 575 customers -- despite turning down some more risqué offers, such as sex in (sub)space.

In April 2013, Richard Branson announced that the cost of a flight would rise from the original target of $200,000 USD to $250,000 USD "until the first 1,000 people have traveled, so that it matches up with inflation since [Virgin Galactic] started."

Branson Virgin Galactic
Richard Branson believes space tourism can be profitable. [Image Source: CNN]

It is unclear whether that price bump caused Virgin Galactic to lose any customers, but the company reportedly at least has 500 passengers onboard at its current rates.  Among the celebrities looking to taste a ride on the SS2 are Ashton Kutcher -- who played Apple, Inc.'s (AAPLlate CEO Steve Jobs in a recent biopic.

Ashton Kutcher is among the early celebrities to reserve a Virgin Galactic space trip.
[Image Source: Vanity Fair]

The flights next year will net Virgin Galactic $1.5M USD per flight.  Flights will last two hours, with a few minutes of time in suborbital space.  If Virgin Galactic can launch 100 fully occupied flights in 2014, it could make $150M USD before costs.

In total 65,000 people have applied for tickets (although most have not fully paid).  If all these passengers follow through, Virgin Galactic could see 1,100 flights over the next decade, scoring $13B USD (assuming a $200K ticket price after the first 1,000 passengers).  In other words, a lot of work remains, but Virgin Galactic could be the first profitable large-scale suborbital tourism venture.

Sources: Virgin Galactic, Richard Branson's Blog, YouTube

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