It has long been an item of faith among some space aficionados in the United States that private enterprise can, if given the chance, sharply reduce the cost of rocket launches. For this vocal group, the government — and NASA in particular — has always been the enemy. What's necessary, they believe, is a commercial launch business unfettered by bureaucratic oversight.

The emergence of such a business has been hampered by its limited range of customers. A few operators of commercial telecommunication satellites aside, the only reliable customers for would-be rocket makers in the United States are government agencies, primarily NASA and the Department of Defense. In the 1990s, it looked for a while as though the satellite business might rapidly expand, as plans were laid to have swarms of small communications satellites circling the Earth. A number of would-be rocket builders opened offices, hoping to capture some of that business. But when the new satellite businesses failed to materialize, the rocket companies disappeared.

Today, the most prominent player in the private rocket business is Internet tycoon Elon Musk, whose California-based company SpaceX has pledged to bring down the cost of launching materials into orbit by an order of magnitude (see page 736).

Musk starts with several advantages. His rocket, Falcon 1, which is sitting on the Kwajalein atoll in the Pacific awaiting its first launch, was produced by a small design team. It doesn't have the overheads of the large corporations such as Boeing or Lockheed Martin that build existing US rockets. The rocket project is financed by Musk himself, and if it works as advertised, there's a real chance that SpaceX could offer to launch payloads at a lower cost than existing options.

But that would be only half the battle. The main things constraining the development of new launch options are the low number of customers and the emphasis that these customers place on reliability, as opposed to cost.

Even assuming that a few dozen millionaires visit Earth orbit each year by 2020, the market will remain commercially insignificant.

Government agencies are by far the largest customers for rocket launches, and they would like to bring costs down. But reliability remains a greater priority. Take a high-value payload such as the $4.5-billion James Webb Space Telescope planned for launch sometime in the next decade, or the $500-million New Horizons Pluto probe scheduled to take off from Cape Canaveral on an Atlas V rocket next month. When the satellite costs far more than the rocket ride, the project manager will pay extra to make sure the spacecraft is delivered safely to orbit. A few tens of millions of dollars in savings wouldn't matter much considering the cost of failure. Similar considerations influence operators of telecoms satellites, who can seldom afford to lose them or delay their arrival into space.

The only remaining customer potential lies with space tourism. But even assuming that a few dozen millionaires visit Earth orbit each year by 2020, the market will remain commercially insignificant. In any case, the space tourists — or at least their insurance companies — may also favour proven reliability over a cheap ticket.

Openings will still arise for the development of more space-launch options on the margins. NASA, for example, is now considering relaxing its traditional insistence on several layers of oversight and inspection for flights that will take food and water to the space station. The agency would instead pay for a delivery service and let the launch provider assume responsibility for the success of the launch.

Such approaches will help to spur on people such as Musk and establish whether they can indeed build a reliable track record in the space-launch business. Until they have done so, the suggestion that entrepreneurial activity can make a substantial difference to the cost of space travel should still be considered pie in the sky.