Customers keep faith in SpaceX after Falcon 9 failure

Marc Eisenberg was jogging on a treadmill in his New Jersey home while he watched SpaceX's Falcon 9 rocket blast off from Cape Canaveral Air Force Station on Sunday morning.

"I saw this perfect launch and was feeling pretty good," said the CEO of Orbcomm Inc., which hoped to launch 11 satellites on a Falcon 9 by September. "And then I saw the result. Maybe I ran a little faster."

The Falcon 9's disintegration a little over two minutes into its launch of International Space Station supplies meant an inevitable delay to Orbcomm's mission and those of several other companies, along with NASA.

But Eisenberg and other customers are confident Space X will rebound quickly, part of the reason many industry experts doubt the launch failure — the Falcon 9's first after 18 successful flights — will mark a long-term setback for the fast-growing private launch company led by Elon Musk.

"One launch failure doesn't make or break a company," said Marco Caceres, a senior space analyst at the Teal Group, a Fairfax, Va., consulting firm. "It is a successful vehicle and I think everybody in the industry knows that these launch failures happen occasionally. The key is that they not become a pattern."

Sunday's mishap interrupted what had been a steady start to the year for SpaceX, with five successful launches in as many months, one shy of its total for all of last year.

But the Hawthorne, California-based companystill reports having a contract backlog of nearly 50 missions worth roughly $7 billion, and those missions don't have many other options, said Chris Quilty, an equity analyst at Raymond James and Associates in St. Petersburg.

He noted that among other frequent commercial launchers, the Russian Proton rocket also is recovering from a failure and Europe's Ariane 5 is booked through next year.

And the Air Force, which recently certified SpaceX to compete for national security launches, remains under pressure from Congress to stop using United Launch Alliance's Atlas V rocket because it is powered by a Russian engine, which some see as a security risk.

The Falcon 9 failure "is unlikely to cause a competitive shift due to the extremely tight nature of the current launch market," Quilty wrote in a note to investors.

He estimated it would take SpaceX four to six months to complete an investigation into what caused Sunday's failure and be ready to fly again. Government missions such as NASA's resupply of the space station resupply may have top priority.

Long delays could be costly to companies that were expecting to bank revenue from satellites now stuck on the ground.

But Orbcomm, which had a successful launch on a Falcon 9 last year and was SpaceX's first commercial launch contract, does not expect a lengthy delay or any impact to its business.

"We know in our heart that they're going to get us up there into space, and they're going to do it well," said Eisenberg. "These guys are some of the most brilliant people on Earth, and they're going to figure this out, and this is going to be a blip on their radar."

In a press conference on Sunday, SpaceX President Gwynne Shotwell said SpaceX's customers have been loyal and had confidence in the company's engineering and operations teams.

"This is a tough business," she said. "Any launch provider has to have considered this in their operational plans going forward. I don't anticipate this to impact any program that we have ongoing. We must find the cause of the failure, we must fix it, and obviously we're going to get back to flight."

Luxembourg-based satellite operator SES, the first company to entrust SpaceX with launch of a communications satellite to an orbit more than 22,000 miles high in 2013, had hoped to fly on Falcon 9 again this August. Spokesman Markus Payer said the company would continue to count on SpaceX.

"SpaceX is and remains an important element in our access to space strategy and also in driving major technological innovations in our sector," he said.

Iridium Communications Inc., which in 2010 awarded SpaceX a contract worth nearly $500 million to launch more than 70 satellites, also said it was confident SpaceX would get the first batch into orbit next year.

"This is a company that has shown a remarkable record of solving the problems that are inherent in the industry, and up to now making it look easy," said Space Florida CEO Frank DiBello, who leads the Commercial Spaceflight Federation's board of directors. "I don't doubt that they'll continue with the record of successes that they've had."

USA Today's Mike Snider contributed to this report