Is NewSpace becoming Old Space again?

I was told to look at the famous map of US defense consolidation between 1980 and 2001. Dozens of companies gradually disappeared into five enormous corporations.

It looks like a family tree.

Except most of the family has been eaten.

NewSpace was supposed to be the alternative: Smaller companies. Faster development. More competition. Specialized suppliers. Less dependence on a handful of traditional primes controlling the entire chain.

Now look at the market. (dramatic pause, hamster meme)

Companies are buying suppliers, bringing production in-house, and building megafactories because relying on someone else is becoming less and less attractive. At the same time, launch companies want to build satellites, satellite companies want to operate constellations, and everyone suddenly wants to do everything.

Everyone is going end-to-end.

Meanwhile, smaller companies are trying to survive long enough to become part of that story.

Because a brilliant prototype is not the same thing as a functioning business.

So, is NewSpace becoming Old Space again?

NewSpace created an explosion of specialized companies making propulsion systems, antennas, software, payloads, satellite buses, launch vehicles, and practically every component imaginable.

That fragmentation was great for innovation. It also meant depending on hundreds of relatively young companies to deliver space-qualified hardware on time, every time.

Yeah, right.

It works… until one supplier is late, one critical component fails, or one promising startup runs out of money halfway through the project.

Space is not software with a rocket emoji on top. You cannot just patch the propulsion system after integration, or magically download a new reaction wheel from the cloud.

So, companies started asking themselves a simple question: why depend on someone else if we can do it ourselves?

Innovation -> fragmentation.

Fragmentation -> inconsistency.

Inconsistency -> consolidation.

Rocket Lab may be the easiest example of what comes next. It started with launch, then expanded into spacecraft, components, solar power, separation systems, software, sensors and communications. Its move toward Iridium would combine launch, manufacturing, satellite operations, infrastructure, spectrum and customers under one corporate roof. WOOHOO!

This is not a company expanding its services.

This is a prime contractor being assembled in real time.

Call them neo-primes. Call them next-generation primes.

The old primes were built through decades of defense consolidation, and the new ones are being built through VC, public markets, acquisitions, government contracts, and understanding that controlling the supply chain is much easier than trusting it.

Governments looove talking about resilient ecosystems, sovereign capabilities and diverse supplier bases. Then they award enormous projects to a handful of companies large enough to finance production, deal with delays, and remain alive for the next twenty years.

I get the logic. One big (vertically integrated) supplier is easier to manage than ten smaller companies. But it creates the same old cycle:

The big companies get bigger. They have more money, so they buy more companies, bring more things in-house, build bigger factories and become even harder to compete with. Then they win another contract, and the cycle starts all over again.

Meanwhile, everyone else is expected to scale, prove flight heritage, stay financially healthy, and keep their company alive long enough for procurement to finally decide what it wants to do.

Good luck with that.

I completely understand why companies are vertically integrating. Nobody wants to depend on a supplier that can hold an entire mission hostage.

But if one company launches the rocket, builds the satellite, manufactures the components, owns the infrastructure and sells the service…

You know the saying: if it looks like a duck, swims like a duck and quacks like a duck, it’s probably a duck. So, if a company owns every critical part of the value chain, what do we call it?

Vertical integration… or monopolization?

Sure, a handful of giant companies can make things move faster.

But they also become companies that are simply too important to fail.

And I am not sure that is the kind of resilience we should be aiming for.

Is NewSpace becoming Old Space?

Maybe not culturally. We will keep the hoodies, founder stories, and inspirational posts about changing humanity.

But the more I look at it, the more familiar it starts to feel.

A few giant players at the top. Everyone else trying to become one of them… or hoping one of them buys them.

Congratulations:

We finally disrupted Old Space.

…by building a new one.