Video It's red faces all round at the Russian space agency after its latest Proton rocket launch failed midflight, destroying a very expensive satellite that was due to beam digital TV all over the former Soviet Union.

The Proton-M rocket, carrying a European-built Express AM4R telecommunications satellite, launched from the Baikonur spaceport at 3:42am local time and appeared to be on track to deliver its payload into orbit. But nine minutes into the flight, it appears that the third-stage engines failed to ignite and the rocket exploded 150km above the Earth.

"The exact cause is hard to establish immediately, we will be studying the telemetry," Oleg Ostapenko, the head of the Russian space agency Roscosmos, told RT. "Preliminary information points to an emergency pressure drop in a steering engine of the third stage of the rocket

All planned Proton launches have now been put on hold, and Roscosmos is launching an investigation into precisely what went wrong during the launch.

The loss of the satellite is a serious blow to the Russian government and the commercial customers who were planning to use its X-band, C-band, S-band, L-band, Ku-band, and Ka-band capacity to carry digital television and internet communications over Russia and its neighboring states. But it's also a serious blow to the Russian space agency, since it's the second Proton failure in less than a year.

Last July, a Proton-M carrying three communications satellites valued at $200m tipped over shortly after takeoff and exploded, sending clouds of toxic smoke over the surrounding area. The Proton-M is the largest commercial rocket in service, but this latest failure makes it more likely that the Russians will lose orbital business to competitors in Europe and the US.

When it comes to failure rates, Europe has the most reliable commercial rocket system with its Ariane 5 launch system – the last time one of those failed was in 2002. The Ariane system was picked to carry the James Webb Space telescope into the skies in 2018 precisely because of its reliability.

While the Russians may be embarrassed by Thursday's failure, it's bound to have made SpaceX's founder Elon Musk a very happy man. SpaceX has had some problems with its Falcon 9 rocket system, but also some notable successes and a genuine first: a rocket that can land after delivery.

While the Falcon 9 is gaining customers, it's not a patch on the Proton rocket when it comes to sheer grunt. Musk's machinery can only lift around 29,000lb (13,150kg) compared to the Proton's 49,000lb (22,000kg), and the Russian rocket is still the booster of choice for very heavy loads.

But the boffins at SpaceX are developing their answer with the Falcon Heavy lifter, which it claims will be able to carry 117,000lb (53,000kg) into orbit or take 29,100lb (13,200kg) all the way to Mars – if it gets off the ground here on Earth.

The first Falcon Heavy demo flight was expected last year, but SpaceX have pushed this back to 2015 at the earliest. Part of this is due to difficulties with manufacturing a reliable rocket, but also because the Falcon 9 is getting so much interest at the moment that the firm is concentrating on its lesser rocket.

That interest has been spurred recently by the deteriorating relationship between the US and Russia over the crisis in the Ukraine. On Wednesday, Russian Deputy Prime Minister Dmitry Rogozin threatened to stop providing flights to the International Space Station and block the supply of rocket parts to US buyers.

That's bad news for Boeing and Lockheed Martin, who rely on Russian rockets to power the Atlas booster used by the US military. But the cloud has a silver lining for Musk, since it leaves his firm in an excellent position to pick up business. ®