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Space Entrepreneur Profile: Gary Hudson

Gary Hudson could be said to be the prototypical space entrepreneur (well, if one ignores Bob Truax and Len Cormier, and probably others I've neglected in an increasingly-frequent senior moment). I first met Gary at a spacer party in northern California in 1980. He's been at it for well over a quarter of a century, and still seems to be going strong, despite the fact that he's almost certainly attained some level of wisdom from his experience. I don't know if that's a sign of devotion to the cause or, at this point, inherent insanity. I decided to find out by asking him.

Transterrestrial: OK, O wise sage of space entrepreneurs. What lessons can you pass down to those of us less worthy, and particularly those of us who haven't yet paid our dues? How the heck are we going to get off the planet?

Hudson: I feel very much like the test pilot in Wolfe's The Right Stuff as he cried, "I've tried A, I've tried B, I've tried C." Looking back over the past thirty plus years that I and my colleagues have been trying to open the space frontier to humankind, like you, I assume there must be lessons learned and knowledge gained from the many failure and occasional successes in which we have participated. But a lot of "don't do this" and not too many "do these things" leap to mind. (I guess the more time one spends, the more negative observations one accumulates!) While we should be mindful of the need not to repeat past mistakes, it is more important to find things that work, so that we have a better chance of success.

Another problem, and one that is all too familiar to those of us who have spent our careers in the struggle, is Poul Anderson's dictum. "I have yet to see any problem, however complicated, which when looked at the right way did not become still more complicated." There is little doubt that that problem of routine reliable and cheap space access has become more complicated.

When I began my particular quest, the principal stumbling block was the inability of most people to grasp the notion of private spaceflight. As halting progress and disappointing failures were encountered, the problem became worse. Technical experience was slowly won, but funding or investment, regulatory and political problems, hostility or equally deadly embrace from NASA, all these were uncovered as time passed.

First, I would argue strongly that we don't need any "new technology" to dramatically reduce the cost of access to orbit. This is not to say we may not want a better engine, or better thermal protection or whatever, but any such application of "improved" technology will be used to enhance rather than enable future spaceships. Second, I think we lost the perceptual argument long ago, as our opponents labeled the next step in spaceflight "reusable launch vehicles" rather than spaceships, or spaceplanes. Finally, as I have been heard to argue before, job one is finance, not engineering.

It is easy to deal with issues one and two. We simply have to take back the debate or ignore the naysayers, if the latter is possible. Which we do is a tactical decision. But how to tackle the funding problem is far more puzzling.

"I've tried A." Investor financing. Been there, done that, don't want to do it again. Either one must seek angel funding with all the hazards that entails (too little money from small investors, eccentric investors) or go the public markets route (post Iridium-Teledesic-Globalstar, not very likely).

"I've tried B." Customer financing. Not promising given the meltdown of the provable market for space transportation and the overcapacity in heavy lift.

"I've tried C." Government financing. With rare exception, government customers are unimaginative or hostile to the transformational potential of commercially driven space markets, leading them to act as the dinosaur sleeping athwart the road to change.

I know that there is a school of thought that aims to start small and take one's time. While I wish such ventures all the best, I have to say I tried that too, along with several sets of colleagues, during the past three decades. It didn't work. There are few markets that will sustain such firms beyond being small-fry NASA or DoD slaves. It is possible that a transformational market may emerge, such as DARPA's RASCAL program or suborbital space tourism.

But the pressure for DARPA to keep RASCAL in the big aerospace model is going to be strong, and the suborbital market is both yet to be proven and fraught with potentially insuperable regulatory challenges. I would want very deep pockets indeed before taking on the struggle to license or certificate a passenger-carrying suborbital spaceplane.

And with the reshaping of our legal and security systems in the wake of the war against the enemies of the West, I think the problems have become even greater. It is much easier for the alphabet soup of federal police agencies to look like they are "doing something" about seemingly uncontrolled technology by controlling entrepreneurs, versus actually doing something useful by finding and destroying our real foes. In case anyone disagrees with this observation, I invite them to try to get on board a commercial aircraft with scissors.

So my long-winded answer to your short question becomes "I don't know." I and a few colleagues are actively seeking an answer even as I write these words, but I have no clue today what that answer may be, or even if one can be found.

Transterrestrial: Whew...

And people think they get more (or less) than their money's worth when they put a quarter in me...

Do you feel as though you were ahead of your time?

Hudson: Most definitely. Prophet without honor in his own country, that sort of thing. Interestingly enough, the one thing I was really concerned about when I began doing this in the late 1960s was regulation by the government either overtly or covertly. And yet it took nearly fifteen years for that process to begin (the Commercial Space Launch Act of 1984) and another ten years or more for the regulatory burden to reach the level of impediment versus nuisance. So I was ahead of my time both working for private spaceships and worrying about those problems that could torpedo them.

Transterrestrial: So, is there any sense that things are finally starting to catch up?

Hudson: During the late 1990s, I did get the feeling that my early views had become widely shared. And before that, during the DC-X program and the studies leading up to it, I found myself on the "accepted wisdom" side of the argument about space transportation, even to the extent of being recognized by Aviation Week and Space Technology magazine with a Laurel. It was an unusual place to be, I can tell you.

But it was also transitory, as the collapse of NASA's SLI effort and the mismanagement of X-33 has demonstrated. Now the industry is peopled by a bunch of whiners saying once again that we don't have the technology or that the cost of new developments would be tens of billions of dollars. (And this stands against the industry's accepted wisdom, announced in 1993, that a reusable space transport could be built for a billion or two.) So things caught up and then regressed.

Transterrestrial: So, is the purpose of your current company, HMX, to do something about that, or to make money while keeping your hand in the business, or both?

Hudson: Both.

I labor under no belief that things will get much better for the "emerging space industry" for the near future, at least for three or four years. Yet it is not easy to walk away from the promise of a real space age, and if I were to do so, it would be hard to come back to it after years of inattention.

But the bottom line for all of us is survival and HMX is my way of staying alive and making some money. For all the investment dollars that I have been able to raise over the years, (never enough, I might add) my average income in the past three decades has been quite low. Then, I was thinking of the future and not the now; HMX exists in part to redress that imbalance.

Transterrestrial: So, what specifically is HMX up to that you can talk about?

Hudson: Currently, our principal focus is setting up an engine test facility for the DARPA RASCAL program. This is a quite unique facility, capable of testing DARPA's MIPCC (Mass Injection Pre-Compressor Cooling) technology needed for the RASCAL aircraft. We are simulating temperature and pressure conditions that an engine might see flying at Mach 4 and quite high altitude. To do this we have designed and are building a test rig that uses a jet engine to provide the inlet conditions for a second test engine. It turns out that like most things, there is nothing new under the sun; this exact approach was used by Lockheed Skunk Works and Pratt & Whitney forty years ago to test the J-58 engine of the SR-71, but we didn't know that at the time we won the contract last fall.

Overall the RASCAL project is meant to produce a demonstration of a partly reusable space-launch vehicle using MIPCC propulsion in stage one and an expendable-rocket-vehicle upper stage. HMX has also teamed with Pioneer Rocketplane to support a RASCAL prime bid. We'd be responsible for the upper stage effort, and the reusable aircraft MIPCC-propulsion systems. If Pioneer and HMX win one of the contracts, and we will know quite soon, we'd be very busy for the next three years.

Finally, we are working on our CoolJet (TM) propulsion system, which was a predecessor to the MIPCC concept. However unlike MIPCC, CoolJet offers a means to smoothly transition between airbreathing and rocket operation in one powerplant, and might be useful not only for space-launch vehicles but also boost-glide high-Mach-number transports. We've been told by the Patent Office that our application should publish within a few months.

Transterrestrial: Assuming that you win the RASCAL competition, do you see it as the future of HMX, or as an "anchor business" that would allow you to pursue even more interesting things?

Hudson: It would be an anchor business. We'd have a moderate share of a long-term government purchase agreement to buy a number of small spacecraft flights per year, and that would assure our survival through the end of the decade. Even if there weren't any profits, the cash flow would be very useful.

Transterrestrial: What potential do you see for the CoolJet (TM) technology?

Hudson: We are always interested in anything that lowers engine development cost or risk, and we think CoolJet (TM) may do both. Turbine engine technology is very mature and widely available, and the "kitting" of off-the-shelf engines with CoolJet (TM) ducts and chambers would allow us to build on that existing base. We think most of the applications would be in the suborbital boost-glide area, for high-speed small passenger transport and military missions.

Transterrestrial: Would that be a space tourist vehicle as well?

Hudson: One could employ the CoolJet (TM) on a suborbital space tourism vehicle. HMX would be willing to act as a powerplant supplier to another firm developing such a vehicle, but has no plans to undertake the development of a suborbtial space tourism vehicle ourselves.

Transterrestrial: Do you see it as a stepping stone to low-cost orbital systems? If so, what would be the evolutionary path?

Hudson: On the subject of a suborbital space tourism vehicle as a stepping stone to an orbital system, I tend to be dubious. I know this goes against current hopes in our industry, but there is such a significant engineering difference between the two types of systems that I don't see the connection in technology.

On the other hand, there may be a "management" path. What I mean by this is that a team that demonstrates it can successfully build and operate a suborbital vehicle carrying passengers would presumably have the credibility (if not the actual capability) to take the next step toward building an orbital system.

Transterrestrial: Yes, that's sort of what I had in mind. I agree that there's no direct hardware legacy from a suborbital to an orbital system, but a low-cost routine suborbital helps break the established mind set that space transportation vehicles have to be finicky and expensive and unreliable. Once that ice is broken (and in addition a suborbital tourism market is established) it makes it much easier and credible to raise the money for development of an orbital system. Would you agree?

Hudson: I agree.

But none of us should underestimate the challenge of building and flying a suborbital vehicle profitably and safely. I think it altogether possible that it could cost two or three times the development bill to get such a vehicle approved by regulators. For myself, if a customer came to me and asked me to manage the development program, I'd want $20-$50 million minimum. Frankly, I can't see anyone paying out that level of funding with the potential regulatory uncertainty.

Transterrestrial: So, what's your optimism level for prospects of low-cost access to orbit in the near, medium and far term?

Hudson: Near term, three to five years, virtually no chance. Medium term, five to ten years, maybe one in four chance. Far term, past ten years, one in three.

Transterrestrial: How about half a century out?

Hudson: Either the promise of a new space age will be a faded memory and we will be trapped here for a long time to come in an increasingly socialist and fascistic world, or we'll have a widespread human presence in orbit and far beyond, maybe with space elevators and solar system spaceships, exploiting the resources of the high frontier.

In the latter case, hope and liberty may have returned to those who both travel outward to the stars and those who chose to remain comfortably at home. But without an open frontier, the future looks very grim to me. That's why, against the odds and in spite of past disappointments, I continue the work. To do otherwise is to surrender the future.

Posted by Rand Simberg at January 24, 2003 09:53 AM
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Another very good interview Rand!!

Posted by Hefty at January 24, 2003 11:26 AM

As downbeat as this mostly is for what I want to see, I wish it came from a less credible source.

Posted by John at January 24, 2003 04:06 PM

Hit the nail on the head. The freedom of Space is our only guarantee for a worthwhile future. Only Out There we can remake ourselves to make life here better.

Posted by Adam at January 25, 2003 04:56 AM

There is one way that suborbital rockets lead directly to orbit, when the suborbital rocket goes to a space tether. See for more info. So I think the reusable xprize type rockets could be on the main development path to cheap space.

Posted by Vincent Cate at January 25, 2003 08:06 AM

And how do you get the space tether into place, without a lot of orbital rockets or a working lunar/asteroid program?

You can't get there from here with a suborbital capability.

Posted by Troy at January 25, 2003 02:33 PM

Too bad Hudson is such a crook. He has never had a good idea, and has bilked millions from gullible investors. Your interview only helps him do it again.

Shame on you!

Posted by Erin at January 27, 2003 07:01 PM

It's not at all clear that this interview will allow him to either raise or "bilk" money from investors, and that's certainly not the intent.

As for your accusation, do you have some evidence that he raised the money in bad faith?

Posted by Rand Simberg at January 27, 2003 08:43 PM

Erin has obviously read Elizabeth Weil's book and drawn the intended conclusion.

As for your interview, it is well done, and I don't find it discouraging. Quite the contrary, in fact. Keep 'em coming!

Posted by Chris at January 30, 2003 10:57 AM

Sounds great I wish you luck


Posted by Dave at February 11, 2003 07:53 AM

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