“IT WILL BE humbling. It will be spiritual.” This is how Virgin Galactic wooed customers with the prospect of a few minutes in space in 2004. Within five years, the space-tourism firm claimed, it would take a total of over 3,000 passengers on life-changing jaunts in its spaceships. On July 11th, after a last 90-minute delay, Virgin Galactic finally began to make good on that promise. Its VSS Unity rocket plane was released from a support aircraft, fired up an engine that accelerated it to three times the speed of sound and soared 85km above Earth’s surface. Thence, for four minutes, its six temporarily weightless passengers, including the firm’s British co-founder, Sir Richard Branson, beheld the planet’s curvature against the blackness of outer space, before returning to a spaceport in New Mexico.

It is unknown if Sir Richard, not known for humility, felt any up there. Back on the ground he called the experience “magical”. Even if he did, he probably also gloated a bit, having just pipped Jeff Bezos, a fellow (much wealthier) billionaire to the heavens. On July 20th Amazon’s recently retired boss plans to go slightly higher, for slightly less time, in New Shepard, a vertical-launch vehicle built by his own spacefaring company, Blue Origin.

The tycoons are among a growing group of enthusiasts that believe space tourism’s time has finally come. A handful of paying customers have flown in Russian spacecraft built as part of a government space programme. Virgin Galactic and Blue Origin, by contrast, designed and built their own vessels for the purpose of lobbing paying passengers beyond the upper reaches of Earth’s atmosphere. “For the first time, we have large, well-funded firms devoted to developing space tourism at scale,” says Matthew Weinzierl of Harvard Business School.

Suborbital tourism is part of a broader space economy that has boomed over the past decade thanks to advances in rocketry and satellite technology. Entrepreneurs and financiers are invading what was once the preserve of governments. In 2020 investors poured $28bn into space businesses, hoping to emulate the success of SpaceX, which has slashed the cost of orbital launches thanks to its ingenious reusable rockets and is valued at $74bn. Bank analysts see vast riches in the stars. Those at Morgan Stanley expect the entire space economy to generate $1trn in revenue by 2040, from $350bn today. Their counterparts at UBS forecast $800bn by the end of this decade.

Space tourism, UBS thinks, will make “a big contribution” to that total if it proves a stepping stone to replacing mass long-haul aviation with hypersonic travel. That is highly unlikely. For now Blue Origin and Virgin Galactic will offer brief suborbital flights. Sir Richard floated slightly below the Kármán line, usually defined as 100km (62 miles) above Earth’s surface, where air becomes too thin to sustain unpowered flight. If all goes to plan, Mr Bezos will float a bit above it (a distinction that Blue Origin has, unsportingly, repeatedly highlighted on Twitter).

But sub-orbital space tourism is not Blue Origin’s main goal. The company is focussed on developing a large new rocket, the New Glenn, for launching satellites, on selling advanced rocket engines to other companies and on bidding on NASA contracts such as that for a system to land humans on the Moon. In the long run Mr Bezos sees Blue Origin as fostering the development of a large-scale space-based economy rather than offering services to thrill seekers.

That is not to say that Blue Origin’s bigger rockets will not, someday, take paying customers who want to go to orbit for fun. SpaceX, though not driven by the tourist market, is beginning to make some money from it as a sideline. It is making seats on the Crew Dragon capsules which it uses to deliver astronauts to the International Space Station (ISS) available to private citizens by way of a company called Axiom Space, which has an agreement with NASA to send its first tourist to the ISS next year. Before that the Inspiration4 mission, paid for by Jared Isaacman, who runs a payments company, will see Mr Isaacman and three companions orbit the Earth in a Crew Dragon without visiting the ISS.

Even suborbital jaunts have an appeal, apparently. Nearly 7,600 people bid to accompany Mr Bezos on his flight. The (still-anonymous) winner coughed up $28m. A survey by Cowen, an investment bank, found nearly two in five people with a net worth of over $5m would consider paying $250,000, Virgin Galactic’s current price, for a ticket. Given that Earth is home to around 2m such people, according to Capgemini, a consultancy, that sounds like a decent-sized market.

Virgin Galactic says it has a waiting list of several hundred willing travellers (which according to Sir Richard includes Elon Musk, SpaceX’s boss). At current prices the business could be lucrative, once regular flights begin to offset the rockets’ development costs. Chamath Palihapitiya, a venture capitalist and Virgin Galactic’s chairman, has said he expects operating-profit margins in the industry to reach nearly 70% at scale, comparable to that of a software company.

Despite its boosters’ claims, however, space tourism is unlikely to be a large part either of the space business or of the tourist industry—at least in the next decade or two. New technologies and frequent trips could help reduce costs but how fast and by how much is uncertain, says Douglas Harned of Bernstein, a broker. Morgan Stanley recently cut Virgin Galactic’s projected annual revenues by 2030 from $1.8bn to $1.3bn, less than half as much as Sir Richard’s Virgin Atlantic airline made before covid-19 grounded most air travel. Without tourist friendly destinations to visit (the capacity of the ISS is strictly limited), orbital tourism, with its far higher ticket prices, is unlikely to be a huger earner.

Investors are not falling over themselves to get into the sector. Several space-tourism startups, such as Rocketplane, Armadillo Aerospace and XCOR Aerospace, have thrown in the towel. This year the popular space-themed exchange-traded fund run by ARK Invest, a tech-investment firm, dumped most of its shares in Virgin Galactic, which went public in 2019. Both Sir Richard and Mr Palihapitiya sold much of their stakes in the firm to free up cash in the past few months. Retail traders on the WallStreetBets Reddit forum talk of shorting the stock.

Another challenge—and the biggest uncertainty—relates to safety. History has shown that a disaster, particularly in an industry’s early stages, can set progress back by years and cause demand to wilt. NASA suspended its programme to send untrained civilians to orbit in 1986 after a schoolteacher perished along with the rest of the crew in the Challenger disaster. It took 15 years for another civilian to brave the journey (on a Russian craft).

The risk is lower for suborbital missions, which place fewer demands on life support systems and increasingly come fitted with emergency abort technology, explains Jonathan McDowell, an astrophysicist at Harvard University. America’s Congress instituted a “learning period” for commercial spaceflight in 2004, leaving medical and safety standards up to the private firms, so long as customers are clearly warned about the risks. But those are not insignificant for passengers barrelling at Mach 3 or more strapped to a pile of high-explosives. As Mr McDowell put it, “being safer than orbital flight doesn’t make it safe.” VSS Unity’s sister craft perished in an accident in 2014.

Even without any accidents, problems may arise when the learning period expires in 2023. Strict top down regulation in designing, building and operating commercial human spaceflight could mean that industry “will no longer have the freedom to pursue new approaches to improving safety”, says Karina Drees, president of the Commercial Spaceflight Federation, a trade group. Add more humdrum annoyances such as launch delays, which are common and often longer than an hour-and-a-half, and space tourism may remain a hobby for a few superrich with a daredevillish streak and lots of time to spare. Not exactly a mass market, then, for the time being. ■