For most of the past sixty years, space was treated primarily as a demonstration of national power. The United States and the Soviet Union went there to prove what their political systems, economies and engineers could achieve. The Moon became a stage for national prestige. Governments supplied the money, governments accepted the enormous risks, and success was measured in scientific achievement, geopolitical influence and national pride rather than commercial returns.
That world has not disappeared. Governments still dominate the most ambitious missions to the Moon and beyond, and military spending remains a major part of the space economy. But something fundamental has changed. Space is becoming an economic sector in its own right — and increasingly, the most important question is not who gets there first, but who can make money from being there.
Follow the money
The clearest way to understand the transformation is to follow the money. The Space Foundation estimates that the global space economy reached $613 billion in 2024, with the commercial sector accounting for about 78% of the total. Governments still represent a substantial share, but the centre of gravity has shifted decisively towards commercial activity. The numbers are expected to grow rapidly. A 2024 report by the World Economic Forum and McKinsey projected that the global space economy could reach $1.8 trillion by 2035, compared with approximately $630 billion in 2023. The report expects much of that growth to come not from rockets and spacecraft themselves, but from industries on Earth that increasingly depend upon space-based infrastructure: communications, positioning and navigation, Earth observation, logistics and data services. That distinction matters. The future of the space economy may be less about selling things that operate in space than about selling services on Earth that happen to depend upon space.
The number that changed the economics
If there is one variable behind this transformation, it is the falling cost of reaching orbit.
NASA research has estimated that the Space Shuttle cost roughly $54,500 per kilogram to Low Earth Orbit, while a Falcon 9 calculation based on its advertised launch price and maximum payload comes to roughly $2,700 per kilogram. The precise comparison depends on what costs are included, but the direction of travel is unmistakable. Reusable launch vehicles have fundamentally altered the economics of access to space.
It is important, however, not to confuse the price of a launch with its actual cost, and neither should be confused with the marginal cost of putting one additional kilogram into orbit. SpaceX does not publish a definitive marginal-cost figure, so claims that the marginal cost has fallen to a few hundred dollars per kilogram should be treated as estimates rather than established facts. The larger point does not depend on the exact number. Getting into orbit has become dramatically cheaper. And once access becomes cheaper, markets that were previously impossible begin to look commercially plausible.
The traffic jam in orbit
The result is already visible above our heads.
In 2024, about 2,802 spacecraft were deployed, according to the Space Foundation. SpaceX was responsible for almost 2,000 Starlink deployments that year. In other words, more than 70% of the spacecraft deployed globally were part of one commercial constellation.
That is an extraordinary concentration of orbital infrastructure in the hands of a single company.
It also tells us something important about the new space economy. The commercial revolution is not being driven primarily by people travelling into space. It is being driven by machines operating there.
Satellites provide broadband communications, navigation, Earth observation, weather monitoring and increasingly sophisticated data services. The value is often created somewhere else entirely — in agriculture, logistics, finance, insurance, telecommunications, defence and consumer technology.
Space is becoming, in effect, a data industry with rockets attached.
The next business frontier
The commercialisation of space is now moving beyond satellite communications.
Companies are developing commercial space stations intended to serve government and private customers as the International Space Station approaches the end of its operational life. NASA is actively supporting several commercial low-Earth-orbit destinations as part of a planned transition away from dependence on the ISS, currently expected around 2030. There is also growing interest in in-orbit servicing, satellite inspection, debris removal and manufacturing in microgravity.
The business case for some of these activities remains unproven. But the important change is that they are no longer merely concepts discussed by government agencies. Companies are developing hardware, securing contracts and attracting private capital. The commercial space station may eventually become the orbital equivalent of an industrial estate. Whether that happens will depend less on imagination than on economics.
The law is struggling to catch up
This is where the optimism becomes more complicated.
The 1967 Outer Space Treaty remains the foundation of international space law. It established principles that still matter: outer space cannot be claimed as national territory, states remain responsible for national space activities, including those carried out by private entities, and non-governmental activities require authorisation and continuing supervision by the relevant state. But the treaty was negotiated in an era when space activity was overwhelmingly governmental. It was not designed as a detailed regulatory framework for thousands of commercial spacecraft, private space stations, satellite servicing, large-scale commercial constellations or the prospect of extracting resources from celestial bodies.
That does not make the treaty obsolete.
It means that a much larger regulatory architecture is now being built around it.
The questions are becoming increasingly difficult. Who is responsible when a private satellite damages another country's spacecraft? How should orbital traffic be managed when thousands of satellites share increasingly crowded regions? Who has priority when commercial and military systems require the same orbital resources? And what legal rights, if any, should companies have over resources extracted from asteroids or the Moon? The international community has principles. What it increasingly lacks is consensus on how those principles should govern a commercial space economy.
The space around Earth is becoming a scarce resource
There is another problem that cannot be solved simply by launching more satellites.
Orbital space is finite. ESA's 2025 Space Environment Report says around 40,000 objects are currently tracked, including roughly 11,000 active payloads. The number of smaller debris objects is vastly greater: ESA estimates more than 1.2 million pieces of debris larger than one centimetre. Some heavily populated orbital bands now contain densities of debris comparable in order of magnitude to active satellites.
And the problem is cumulative.
A satellite that stops functioning does not simply disappear. Unless it re-enters the atmosphere or is deliberately removed, it can remain a hazard for years or decades.
This is why the Kessler syndrome — the possibility of a cascading sequence of collisions generating ever more debris — is no longer merely a science-fiction scenario. ESA warns that debris can continue to increase even without additional launches because fragmentation events create new objects faster than natural atmospheric re-entry removes them. The paradox is obvious. The cheaper it becomes to use space, the more valuable space becomes. And the more valuable it becomes, the more crowded it becomes.
Britain, Europe and the new space economy
For Britain and Europe, this transformation presents both an opportunity and a strategic warning.
The United States has companies such as SpaceX operating at a scale that has changed the economics of launch and satellite deployment. China is developing an increasingly sophisticated commercial and state-backed space sector. Europe possesses world-class scientific and industrial capabilities, but its commercial ecosystem remains fragmented by national regulation, funding structures and political priorities.
The question for Europe is therefore not whether space will become commercial.
It already has.
The question is whether European companies will capture enough of the value created by the new space economy — or whether Europe will increasingly become a customer of American and Chinese infrastructure.
That question extends far beyond rockets. It concerns communications, navigation, Earth observation, climate monitoring, defence, financial services, agriculture, transport and the enormous quantities of data generated by satellites. Space is becoming part of the infrastructure of the global economy.
The next space race will look different
The first space race was about reaching somewhere first. The second was about maintaining a permanent presence. The emerging competition is different.
It is about infrastructure, data, services, manufacturing, communications and control of the orbital environment.
The winners may not be the countries that plant the next flag on the Moon. They may be the companies and governments that own the networks connecting Earth to space, control the data flowing through them and establish the rules under which everyone else operates. That is why the most important transformation in space may not be the return to the Moon at all. It may be the quiet conversion of orbit into another layer of the global economy. Space is no longer simply somewhere governments go.
It is becoming somewhere businesses operate.