Below is an excerpt of MilkyWayEconomy's 2020, best selling space economics book, "Blockchain & The Space Economy". We've decieded to release select chapters of the book as blog post because a) after reading it you'll run out and buy the book and b) despite being accidental VCs in Space we're really just nerds who want to share cool facts about Space with anyone willing to listen. Enjoy.
Fifth Industrial Revolution = SPACE
Framing Space Race 3.0 as part of the Fifth Industrial Revolution (5thIR) and putting it in context with the other four major economic, technologic, and social shifts, allows us to better appreciate the significance of what is happening today. Tapping into the resources of Space will have much the same economic significance for the nations and companies that lead as did coal for Britain 250 some odd years ago. Although the ability to have satellites mounted with solar panels beaming concentrated solar energy back to the Earth is a possibility, the resources we seek in space are not energy in the same way that coal was for the British. Instead in Space it will be data, scientific discovery, and expansion of territory.
Data is the new oil. Data is gold.
Several CEOs have made public statements saying they believe that their warehouse of customer data is potentially more valuable than their entire current business enterprise. Data in Space is not just a resource we will collect looking out into the Cosmos, it is a resource we are already collecting as we look down onto and into ourselves.
We collect this data using satellites, about 2,200, as of January 2020. We have come a long way since Sputnik and to help better understand this, I want you to think about Zack Morris from ‘Saved by the Bell’ (the first non-cartoon show I watched with regularity) and the Pentagon’s recently announced plans. The technology in your pocket, hand, or jacket reading this book to you over your earbuds shares much in common with what's in satellites. So much so that back in 2014 NASA launched several “Dove” nanosatellites using consumer-grade smartphones modified only by a small box to help charge, navigate, and relay data. That technology used to be in devices the size of buildings. Over just a few short decades it shrunk to the size of a bus, then a microwave size Zack Morris cell phone, and now your Samsung Note 10. Along the way, the technology didn't just get smaller, it got better and cheaper. This three-part benefit has come about partially due to the economies of scale of 5-billion cell phones being made and in-use today.
The Pentagon has said it will be building and launching a new satellite each week over the next several years. The more launches the better the tech gets for future spacecrafts. The more we build the better we get at it. The greater the number of firms, people, and resources directed towards this endeavor, the faster the knowledge is spread into other areas of the economy. The incredible future growth in satellites is likely to be a stand-alone trillion-dollar industry. This further advances eventual spaceports, Moon, and Mars missions. Convergence of these forces is where the exponential growth comes from.
Important to remember is that raw data is not in and of itself power. Raw data is the equivalent of jumbled letters of the alphabet in wood. Information, however, is when Gutenberg puts the alphabet onto printing metal blocks and books go from the monasteries of Europe to the masses. These mountains of raw data from satellites will be transformed into “books” of information about every aspect of human life here on Earth. The rise of mass printing books, namely the Bible, gave way to a demand for learning, the creation of Universities, and the sparks of literacy over five hundred years ago. What will the rise of this mountain of raw data lead us to demand, create and make common place?
Data from satellites alone is not the only resource, technology, or economic incentive for the New Space Race. The, not just possible but likely, scientific discoveries awaiting us in Space are also a major driver of this new chapter.
If data is the new oil and oil is gold, what is the new energy? The answer is not straightforward and while the likely option for electric power in Space seems to be a combination of nuclear and solar it is still far too early to tell what other systems or resources may be developed, e.g.: dark matter, ion drives, solar winds. Some young engineer and budding inventor is likely in her first year of college right now with an idea for a new system for energy that will be just what is needed to fuel the Fifth Industrial Revolution. This source of fuel may even help improve launches and could the new breakthroughs in energy could even go so far as to translate into a new way of living on Earth. It is important to stay open to not just advances in nuclear and solar but also a whole host of potential new energy resources we cannot yet conceive.
Scientific Discovery for Profit
NASA spends a relatively small amount on scientific research, analysis and discovery in Space. To be clear this is separate from what is spent on technology to get off Earth, satellites to look at Earth, telescopes, heliophysics and deep space. Out of the most recent budget, approximately 45% was dedicated to human space flight and a bit less than half of that is funding for continuing funding of the International Space Station (ISS). This budget is made up of a long list of items but a few of them worth noting include paying about $86 million for each seat aboard Russia's three-person Soyuz spacecraft for trips to the International Space Station (ISS), and only $350 million for ISS research.
ISS research representing only a bit over 1.50% of NASA’s budget has taken place at a relatively similar rate over the last 17 years, as astronauts have worked and lived continuously onboard. The ISS has advanced scientific research and knowledge, while at the same time helping to develop new technologies that benefit from its special location. To date, the unique microgravity laboratory has been part of over 2,500 research investigations and experiments, with 3,400+ investigators participating and more than 1,600 R&D results published in scientific journals and magazines. These projects include studies from the fields of remote sensing, drug therapies, monitoring weather, physical sciences, life sciences, improving equipment for first responders, producing unique fiber-optics (ZBLAN) and technology.
This research has included specific research into exercise, nutrition and drug use for the treatment of osteoporosis, a condition affecting millions. Other research has focused on the DNA of microorganisms capable of surviving interplanetary spaceflight. Medical research has also been devoted to the study of gene-folding. An important area of pharmaceutical development is understanding the shape of protein molecules and crystallography, which, because it is inhibited by gravity, is able to be experimented with in the absence of convection and the settling out of denser particles allowing the crystals in microgravity to be much larger and easier to analyze, facilitating the study of the microstructures and interaction for therapies in muscular dystrophy and cancer. The physics of fire and combustion in microgravity have also been studied because fuel forms into tiny droplets under microgravity and when ignited are incredibly efficient, laying the foundations for advancements in combustion and reducing carbon fuel consumption on Earth.
This research portfolio represents a small part of NASA’s budget, but beyond that an infinitesimal part of the overall money spent on research and development. As commercial Space provides options for space stations that can be built for a single company or leased out by several, the growing community of researchers who can put their scientific dreams beyond the limits of gravity will increase exponentially. Those forging ahead in this leadership in commercial space for the purposes of research will discover groundbreaking science not possible on Earth. The first use of specialty nanofluids developed in Space, used in the delivery of a groundbreaking medicine or a commercial application of cold flames, will change everything. This is all without trying to push the bounds of imagination too much and entertaining the possibility of discovery with the Cold Atom Laboratory (CAL) which produces clouds of ultracold atoms known as Bose-Einstein condensates (BEC), the study of which could advance our understanding of quantum physics and the wavelike nature of matter. So put simply, a discovery in any one of these industries stemming from research in Space could launch an incredible escalation of demand for access to research capabilities off Earth.
Far and Away the Colonization  of Space and Expansion
Lastly, and maybe the hardest to understand, is the economic benefits from sheer expansion of territory. Consider the value of a large assembly room floor or the size of a home in Ohio or Maine versus NYC or DC. It is perhaps difficult for us to understand because we did not grow up in a century of exploration, colonization, or conquest. Land is, of course, always necessary for expansion, but so is bread. In classical economics, land is placed as one of the three factors of production, alongside labour and capital. Land is typically understood to take on two values (1) for the services and (2) the stock of land. A good example of the two parts of this value for land is in the movie “Far and Away” where Joseph (Tom Cruise) is willing to risk his life, on multiple occasions, for access to the limited stock of land being given away freely by the US Government  in Oklahoma circa 1890s. The land he is after would be better if it also had access to water, thereby enhancing its potential to render service for his economic pursuits, but that is a separate concern after simply occupying his own land. So, will land in Space win you the heart of Nicole Kidman, well we don’t know the answer to that. But, what we do know is that in a similar way to“Far and Away” a land race is already underway in Space. The current most valuable land is the orbital pathways of LEO followed by MEO (Medium Earth Orbit), and GEO (Geosynchronous Equatorial Orbit). The Iridium Communications Network will consist of 66 satellites when complete and Starlink is slated for
12,000. Who gets the first claim to this“land'' in Space? Based on our experience in Oklahoma, it would appear to be whoever grabs the flag first.
The three rules in real estate will be the same for Space as they are on Earth: location, location, and location.
 Author’s Note - We do not take lightly the concept of colonizing space.The wounds of colonization remain fresh even today in the United States America, throughout the Americas, Africa, the Middle East, India and globally. In Book II of the Milky Way Series, Racein Space - Racial Equity & Justice in the Space Economy our resident anthropologistSamson Williams tackles the concept of the colonization of Space, institutional racism and what these factors mean for permanent Human settlements in Space.
 This “free” land was of course notfree. Rather it was stolen thru colonization from the Cherokee, Chickasaw, Choctaw and Seminole and Muscogee Nation. In July 2020, the Supreme Court of the United States ruled that nearly 50% of eastern Oklahoma falls within an
Indian reservation. How this will affect Oklahoma as a state is a fast-developing story.
About the Authors
Samson Williams and George S. Pullen are the founders of MilkyWayEconomy, a Washington, DC & Maine based think tank that specializes in understanding the economic foundations of the Fifth Industrial Revolution and the Space Economy. In addition to writing, researching, and being investors in 5thIR companies, Samson and George are adjunct professors at the University of New Hampshire School of Law and instructors at Columbia University in NYC. Additionally, George is a Marine (retired) and guest lecturer at the National Defense University.