SpaceX has changed the space economy. Its reusable rockets have lowered costs, Starlink has turned low Earth orbit into a commercial connectivity infrastructure, and the company has positioned itself at the center of some of the strategic priorities of the United States and its allies. But this very efficiency now raises an uncomfortable question: what happens when a state depends on a private company to access critical infrastructure?
A working paper by Stefano Marcuzzi and Alessio Terzi, published by the Bennett School of Public Policy at the University of Cambridge, compares SpaceX’s current position with the role played by European companies in the Indies during the 17th and 18th centuries. The comparison is not meant to suggest that SpaceX will govern territories or populations as those corporations did. The parallel lies elsewhere: in the accumulation of structural power by companies operating at a frontier where public rules arrive late, are ambiguous, or are difficult to enforce.
The Monopoly Born from Efficiency
The study’s thesis is based on a very compelling economic fact. SpaceX did not achieve its dominant position because a state formally granted it a monopoly, as happened with the East India companies. Instead, technology, vertical integration, and scale have produced a similar outcome.
Rocket reuse changed the cost of access to orbit. According to the paper, the average cost to send a kilogram to low Earth orbit dropped from about $87,000 in 1960 to less than $4,000 in 2025—an accumulated reduction of over 95%. SpaceX was the company that turned reusability into a sustained industrial advantage starting with the Falcon 9.
The next step was even more decisive: creating its own demand. Starlink required thousands of satellites and hundreds of launches. This constellation made a flight cadence viable that other competitors could not replicate. In 2025, 72% of SpaceX’s launches were dedicated to deploying its own Starlink satellites, according to the authors’ data.
| Factor | Effect on SpaceX |
|---|---|
| Rocket reuse | Reduces costs and allows higher cadence |
| Starlink | Generates internal demand for launches |
| Vertical integration | Controls rockets, satellites, network, and services |
| Operational learning | Each launch reinforces accumulated advantage |
| Capital and revenue | Funds new innovation rounds |
| Frequencies and orbits | Increases entry barriers for rivals |
The result is an unusual concentration, even in tech sectors. The study states that SpaceX’s share of total mass launched into orbit rose from less than 10% in 2014 to nearly 80% in 2025. In the U.S. market, that share hit 94% in the same year.
This figure underpins a core concern: if a company controls the bottleneck to space access, governments can remain formally sovereign but lose operational leeway.
Starlink Changes the Nature of Space Power
SpaceX is no longer just a launch company. Starlink has transformed it into a satellite telecommunications operator, a provider of civilian connectivity, and a supporter in military or emergency scenarios. That layer brings the debate closer to issues of sovereignty.
The study notes that Starlink became strategic once it was used in Ukraine. It also highlights that SpaceX and Starshield, its branch focused on secure government communications, have become critical infrastructures for defense, intelligence, and civil communications.
This introduces the concept of structural power, borrowed from Susan Strange. It’s not just about forcing someone to act but about defining the framework within which others must operate. In this sense, SpaceX accumulates power across several layers: production—controlling access to orbit; knowledge—its cadence yields data and learning that no rival matches; security—its networks become useful for governments; and finance—its position attracts capital for continued advantage.
| Type of Power | How it manifests in SpaceX |
| Production | Control of orbital access at scale |
| Knowledge | Operational data and learning from launch cadence |
| Security | Starlink and Starshield as civil and military infrastructure |
| Finance | Ability to attract capital due to dominant position |
| Norms | Practical influence over standards and space practices |
| Geopolitics | Role in conflicts, communications, and national programs |
The concern is not that SpaceX replaces the state. It’s more subtle: that governments end up depending on a company they need but cannot steer as if it were a public agency.
The episode cited by the authors, involving Donald Trump and Elon Musk, exemplifies this tension. If a government threatens contracts and the company responds by threatening to withdraw a critical capability, it’s clear that the relationship is not just like that between any customer and any supplier.
The India Company Analogy
The comparison with the East India Companies is provocative but useful, if handled carefully. Those companies were created by European states to operate in frontiers where public authority was limited. They had commercial aims but also acted as instruments of national power. They signed agreements, administered territories, imposed rules, and even performed functions akin to a state.
SpaceX does not govern populations or control colonial territories. The authors acknowledge this difference. Space doesn’t have indigenous populations or pre-existing political structures over which to exercise dominium. But the analogy focuses on another dynamic: private companies growing in ambiguous legal zones, accumulating control over critical infrastructure, and ultimately shaping states’ capabilities.
The 1967 Outer Space Treaty was designed when space activity was almost exclusively a state monopoly. It lays out broad principles like non-appropriation of celestial bodies but lacks strong mechanisms for resolving commercial disputes or regulating private activities. The Artemis Accords aim to update part of this framework but are not a universal multilateral treaty and do not include China or Russia.
This absence of binding rules creates space for early actors to define uses, standards, and practices. If a company operates early, learns quickly, deploys first, and sets procedures, it can influence de facto norms—even if it doesn’t write the law.
The Dilemma for Governments
The study raises a difficult political question. The U.S. wants SpaceX to remain strong because its advantage helps counter China. But the stronger SpaceX becomes, the greater the reliance of the state on it. Overregulating too early could blunt its strategic edge; delaying regulation risks high costs of regain control later.
The history of the East India Companies shows this pattern. States tolerated and protected them because they served national interests against rivals. They only intervened forcefully once political, financial, or military costs became unsustainable. By then, many rules, privileges, and structures had become deeply embedded.
Marcuzzi and Terzi warn that governance reforms tend to arrive too late, after dependence has already been entrenched. In space, this window may be even narrower. Orbits, frequencies, standards, lunar security zones, and operational agreements may all be shaped by the first actors to arrive.
What Can Europe Do?
For Europe, this is an especially uncomfortable realization. The continent seeks strategic autonomy but lacks a SpaceX equivalent. Ariane 6 advances in a tougher market, and the European industry debates how to scale without creating internal monopolies. The paper mentions the risk that Europe, in pursuit of industrial champions, reintroduces part of the problem observed in the U.S.
The solution is complex. Excessive fragmentation can leave Europe without enough scale to compete; too much concentration risks internal dependencies. The lesson is not to choose between market or state but to proactively design redundancy, oversight, and interoperability mechanisms from the start.
| Possible Public Response | Objective |
| Diversify launch providers | Prevent dependence on a single company |
| Use public procurement as leverage | Require interoperability, data sharing, and competition |
| Maintain redundant capacities | Spend more short-term to gain autonomy |
| Supervise critical infrastructures | Ensure key decisions are not only in private hands |
| Coordination among allies | Reduce collective dependence on a single provider |
| Early regulatory frameworks | Prevent business practices from becoming hard-coded norms |
The study suggests that the U.S. can also adopt some of these strategies. Measures include using public procurement to preserve competition, maintaining some redundancies in launch capacity, involving public representation in critical firms, exploring strategic minority stakes, and coordinating Artemis purchases to sustain alternatives.
None of these solutions are simple, and all come with costs. But the alternative is accepting that a central part of space infrastructure depends on a private company with its own interests, schedule, and growing negotiation power.
Space as Critical Infrastructure
The discussion on SpaceX extends beyond space itself. It is also relevant for understanding other sectors where the state depends on private tech companies: cloud computing, AI, cybersecurity, semiconductors, telecommunications, or satellites. The same logic recurs—critical functions are externalized because the private sector innovates faster. Later, when these functions become essential, the provider’s position becomes hard to displace.
Sovereignty does not mean that the state must produce everything itself—that’s unfeasible. It’s about avoiding being trapped in dependence without alternatives. In space, this balance will only grow more difficult, as scale rewards those who launch more, learn more, and integrate more deeply.
SpaceX has achieved what few governments managed: reducing space access costs and transforming space into a genuine commercial platform. This achievement doesn’t disappear amid risks. The core issue remains: the more useful the infrastructure, the greater the danger of dependency on a single actor.
The history of the East India companies offers no precise recipe but provides a warning. Economic frontiers often begin with innovation, capital, and promise. Later, rules and privileges are established—sometimes after private interests have already shaped the landscape. Space should not wait for a crisis to realize that its governance was written by those who arrived first.
Frequently Asked Questions
What does the Cambridge study say about SpaceX?
The working paper states that the concentration of launch capacity in SpaceX creates strategic dependencies for governments and echoes the historical dynamics of European companies in the Indies.
Does it literally compare SpaceX to a colonial enterprise?
Not entirely. The authors acknowledge that space lacks indigenous populations or colonial territories. The comparison focuses on power concentration, legal ambiguity, dependence on the state, and functions akin to sovereignty.
How much market share does SpaceX hold in launches?
According to data cited in the study, SpaceX’s share of the total mass launched into orbit increased from less than 10% in 2014 to nearly 80% in 2025. In the U.S., it reached 94% in that same year.
Why does this matter for sovereignty?
Because governments could end up depending on a private company for space access, operating critical communications, supporting lunar programs, or deploying military and civilian satellites.
via: University of Cambridge and Project Syndicate
