SpaceX made history earlier this week, successfully orbiting a payload via their ground-launched Falcon 1 2-stage liquid-propelled rocket:

Read more about the launch.

SpaceX follows Orbital Sciences into the privately-funded commercial space-launch business. Orbital Sciences started the privately-funded commercial space launch business in 1990 with their Pegasus. The fundamental difference between what SpaceX did and what Orbital did is that Orbital’s system uses air-dropped launch vehicles, which essentially use an airliner as their first stage - sort of like the old X-1/X-15 model. This limits the size & weight of the payloads Orbital can launch.

SpaceX has gone with a traditional ballistic rocket model, starting from the smaller Falcon 1, and including the heavy-lift Falcon 9 and Falcon 9 Heavy. Their heavy-lift booster will put them in full competition with the Boeing Delta IV, the Lockheed-Martin Atlas V, Arianespace Ariane 5, and the Russian Proton & Soyuz. They expect to achieve breakthrough cost models; we shall see, as all these others got their R&D funding from government involvement (i.e. they’ve only been privatized after decades of public-sector funding).

SpaceX is also proposing the Dragon orbital vehicle, which can carry cargo or a crew of 7 in its pressurized capsule. NASA will be buying Dragon launches as part of its COTS (Commercial Off The Shelf) purchasing of launch services for the International Space Station, since the Space Shuttle is planned to be retired in 2010.

Falcon 9 is scheduled for a first test launch next year, along with 2 test launches with the Dragon (the second of which will dock with the ISS). Commercial ISS resupply via Falcon 9 + Dragon is scheduled for 2010.

SpaceX was founded by Elon Musk, co-founder of PayPal. When eBay bought PayPal, he took that money and went and created SpaceX. Computer geek becomes space geek.

Interesting times.