The space industry is an industry that provides interesting analysis, especially in the area of Porter's Five Forces. During the early years of spaceflight, the industry was a monopoly of a small group of national governments. During this time, barriers to entry and supplier power was high.
In 1984, President Reagan passed the Commercial Space Launch Act which allowed private operators to perform launches. While government agencies, including NASA, maintained dominance within the space industry, this act allowed commercial companies to get a foot in the door of the industry. This act decreased the barriers to entry to allow the possibility of additional companies to enter the market. While the barriers to entry were still significant in terms of cost and resources, it was now possible to enter the once monopolistic market.
In July 2011, the space shuttle program ended, leaving Russia as the only provider that could fly crews to and from the International Space Station. The decision to discontinue the shuttle program decreased buyer power because it left consumers (astronauts trying to get to and from the International Space Station) with only one main option. With this being the case, many private spaceflight companies, including SpaceX, have moved towards creating their own shuttle vehicles that will eventually allow passenger travel. These companies anticipate they too will be able to transport austronauts to and form the ISS within the next year, which will increase the availability of substitutes within the industry.
The advancement of private spaceflight companies could possible open the door to new potential industries, including space tourism. These future industries could most likely have characteristics similar to the current space industry - high barriers to entry, low buyer power, and high supplier power - but could potentially create an increase in rivalry as more companies enter the private spaceflight industry.
