MirCorp
Encyclopedia
MirCorp was a commercial space company created in 1999 by space entrepreneurs and involving the Russian space program that successfully undertook a number of firsts in the business of space exploration
by using the aging Russian space station Mir
as a commercial platform. Its actions were highly controversial as it created a roadblock to the planned International Space Station
in creating a viable, low cost alternative.
The company achieved the following:
In terms of business development, the company was able to launch the era of space tourism by signing American businessman Dennis Tito to his launch contract. It also signed with television producer Mark Burnett
(producer of the Survivor reality show) and with NBC
, to produce a reality show “Destination Mir,” where the winner would travel to space. And it also was able to sign other media, entertainment and commercial space research projects. MirCorp’s CEO Jeffrey Manber
later stated “ we failed to survive but proved the business model, and in the long-term that will be just as important.”
The company came to an end for a variety of reasons. It seems to have been a combination of the financial backers' inability to continue funding the venture, a business model that made little sense, and pressure by NASA
to de-orbit the station. NASA viewed the station as a threat to its plans for the International Space Station. The station existed until March 23, 2001, at which point it was deliberately de-orbited, breaking apart over the Pacific Ocean.
. Russia lacked the funds to upgrade and save the space station, and had concluded it had no choice but to deorbit the station. Several ideas were floated, including one to hand over the Mir to the United Nations
. The idea proposed by Anderson and Tumlinson was to save the Mir space station by raising it to a higher orbit to gain time and developing a “space tether
” to supply power to keep the space station in orbit while further funds were raised. This plan was never implemented by the MirCorp team, as the United States government barred the export of the space tether technology until after the deorbit of the space station was announced.
The founders recruited well known space entrepreneur Jeffrey Manber
, who had helped negotiate the first contract between the Soviet Union and NASA on space interests, and had also represented the huge Russian space company RSC Energia in its American dealings during the 1990s. Manber created the business model for the venture which involved proving that space could be a platform for media and entertainment, as well as serious space research
.
In February 2000, the agreement between the Russian space company RSC Energia, which had the commercial rights to the space station, and MirCorp, was announced in London. Present at the press conference was MirCorp CEO Jeffrey Manber and RSC Energia General Director Yuri P. Semenov. Also present at the press conference was co-investor Dr. Chirinjeev Kathuria, and Andrew Eddy, recruited from the Canadian Space Agency.
The news took senior NASA officials by surprise, and thus began the roller-coaster ride of the MirCorp efforts. Their efforts were criticized by many as a private interference with international space policies. Their desire to sell ticket to space as part of a “citizen explorers” program was ridiculed by NASA and its supporters.
Yet, as a result of the company’s backing, the RSC Energia officials boosted the Mir into a higher orbit, thus postponing the deorbit that had been agreed to by the Russian Space Agency in discussions with NASA. Manber later explained that the business model for the venture was modeled after that of air travel
, where Boeing
may build the planes but commercial agents such as United or British Airways
sells the tickets. The intent was to have marketing experts sell the space program, and let the space manufacturer, RSC Energia, focus on the safe operations of the station. Manber explained that in the aviation world it was not the manufacturers who sold the tickets, it was the marketing companies. MirCorp and RSC Energia were the first to use this strategy for space exploration, which has emerged again more recently with Sir Richard Branson
’s announcement to market Scaled Composites
StarShip
suborbital flights.
It was also unusual as an international venture with Russia in the 1990s in that the Russians were given the operating control of the venture, reflecting the political realities of the importance of the Mir to the Russian society. RSC Energia owned 60% of MirCorp, whereas the financial investors controlled 40%. Investor Anderson explained that he was comfortable letting the Russians run the space component, and his team would run the business. “A lot of this venture is based on trust, pure and simple.” Anderson explained. Anderson was not so sanguine regarding NASA and used the media interest in the venture to launch many critical comments towards NASA, the planned International Space Station and even the foreign policies of the American government. This could not have but solidified opposition to the venture inside the Administration. Indeed, Anderson selected Holland as the headquarters for the company since he believed the country was far more ethical than that of his own.
Regardless of the controversy, a new era in space exploration was inaugurated on April 4, 2000, when the Soyuz TM-30
, known as the MirCorp mission, carried two crew members, Sergei Zalyotin
and Alexandr Kaleri
, to the Mir space station.
The two man crew returned the dormant Mir space station to life, located the source of the leak, repaired the leak, and carried on commercial and basic research. Zalyotin admitted to being nervous when the hatch door was opened, not sure what exactly would be found in the station.
While the mission was being undertaken, the management of MirCorp was able to announce a number of commercial contracts, including that of the agreement with NBC
and Mark Burnett
. NBC even began running commercials promoting its upcoming “Destination Mir” reality show.
On June 16, on schedule, the mission came to an end. It had lasted 73 days and the crew returned in good health. Behind the scenes, the MirCorp management and Energia space officials were both surprised at the technical and commercial success, but worried that the Mir would soon have to be shut for good.
On June 19, 2000, a press conference was held at the Russian Mission Control Center TSUP, at which the MirCorp president, along with RSC Energia head of International Development Alexander Derechin, announced that Dennis Tito, a former US space program engineer, who founded Wilshire, Associated—the Santa Monica, California-based company that revolutionized the field of investment management consulting, was MirCorp’s first “Citizen Explorer.”
Tito would subsequently withstand intense pressure brought on him and on Russian space officials, by NASA not to undertake his mission. NASA administrator Daniel Goldin
publicly rebuked MirCorp for their efforts during Congressional hearings. Tito went forward with his training and eventually, with the deorbit of the Mir, he transferred his efforts to fly on the International Space Station. With the help of RSC Energia, MirCorp and later Space Adventures
, he became the first space tourist to visit the International Space Station.
was not the first “amateur” to blast into space. Previously, Japanese TV journalist Toyohiro Akiyama had flown on a commercial mission to the Russian space station Mir. Tito was the first to pay for his own ticket, thus earning the designation of the first space tourist.
The Tito mission also took place in the backdrop of the whole controversy regarding the decision by the major Russian space company RSC Energia to work with MirCorp to create a commercial space station, and thus, many felt, put at risk the struggling Russia’s obligations on the planned International Space Station.
NASA’s behavior about learning of the Tito mission was unusual. The space agency immediately cancelled planned high level meetings between the Russian and US space agencies. Their legal team declared that a bill would be sent for any damages caused by the flight of Tito.
"In November 2000, we informed NASA that we planned to launch Tito to [Alpha]," said Koptev, who did not recall NASA expressing any negative reaction at that time. That situation changed, however, as the two space powers entered into a standoff in which neither would back down.
The head of the Russian Space Agency later told reporters that “Our legal advisors told us that the fine for any misdoing aboard the station, including damage to morale, could exceed the money that we had earned from Tito's contract, and could even exceed Russia's space budgetary capacity," Koptev said.
The reaction after the eventual mission to the International Space station, not to the Mir as initially planned, was harsh and personal. Dan Goldin, NASA administrator, implied that Dennis Tito was not an American patriot and US Sen. Barbara Mikulski
of Maryland compared the behavior of all those concerned with the space tourist program to that of “pimps.”
The Senator’s harsh views reflected many in Washington who regarded with disdain the concept of commercialization connecting with national space programs.
In addition, on several occasions the Russians claimed that they had not been reimbursed by MirCorp for services. MirCorp founder Walt Anderson was later charged with federal tax evasion, plead guilty, and was sentenced to nine years in federal prison.
The company remained in business even after the Mir was destroyed. It handled the efforts of *NSync boy band Lance Bass
’s unsuccessful effort to fly to space, as well as that of former NASA official Lori Garver (currently Deputy NASA Administrator), who also sought to use advertising as a means to be a space tourist, before finally closing the doors.
MirCorp attempted to demonstrate that a private company could manage a manned space station; that a business model
could be developed around an orbiting space station. However, its failure to produce sufficient revenue to pay its modest expenses and the imprisonment of one of its founders for tax evasion indicate that its efforts were unsuccessful.
Today the situation has changed. Former NASA administrator Michael D. Griffin
has voiced full support for commercialization of manned space activities and the Russian operated space tourist program is fully accepted by the United States.
The space tourism program has continued in Russia, which today enjoys far more robust funding than a decade ago.
Space exploration
Space exploration is the use of space technology to explore outer space. Physical exploration of space is conducted both by human spaceflights and by robotic spacecraft....
by using the aging Russian space station Mir
Mir
Mir was a space station operated in low Earth orbit from 1986 to 2001, at first by the Soviet Union and then by Russia. Assembled in orbit from 1986 to 1996, Mir was the first modular space station and had a greater mass than that of any previous spacecraft, holding the record for the...
as a commercial platform. Its actions were highly controversial as it created a roadblock to the planned International Space Station
International Space Station
The International Space Station is a habitable, artificial satellite in low Earth orbit. The ISS follows the Salyut, Almaz, Cosmos, Skylab, and Mir space stations, as the 11th space station launched, not including the Genesis I and II prototypes...
in creating a viable, low cost alternative.
The company achieved the following:
- First commercial lease agreement for orbiting manned space station (December 1999)
- First privately funded manned expedition to a space station (Soyuz TM-30Soyuz TM-30Soyuz TM-30 , also known as Mir EO-28, was a Soyuz mission, the 39th and final human spaceflight to the Mir space station. The crew of the mission was sent by MirCorp, a privately funded company, to reactivate and repair the station...
, launch April 4, 2000, return June 16, 2000) - First privately funded cargo resupply mission in space (April 27, 2000)
- First privately funded spacewalk (May 12, 2000)
- First contract for space tourist (Dennis TitoDennis TitoDennis Anthony Tito is an Italian American engineer and multimillionaire, most widely known as the first space tourist to fund his own trip into space. In mid-2001, he spent nearly eight days in orbit as a crew member of ISS EP-1, a visiting mission to the International Space Station...
, June 19, 2000)
In terms of business development, the company was able to launch the era of space tourism by signing American businessman Dennis Tito to his launch contract. It also signed with television producer Mark Burnett
Mark Burnett
Mark Burnett is a British television producer and executive producer, based in the United States. He currently is the executive producer of five network television series with seven hours of network programming. Works with which Burnett is associated have won multiple awards and recognition...
(producer of the Survivor reality show) and with NBC
NBC
The National Broadcasting Company is an American commercial broadcasting television network and former radio network headquartered in the GE Building in New York City's Rockefeller Center with additional major offices near Los Angeles and in Chicago...
, to produce a reality show “Destination Mir,” where the winner would travel to space. And it also was able to sign other media, entertainment and commercial space research projects. MirCorp’s CEO Jeffrey Manber
Jeffrey Manber
Jeffrey Manber is regarded as one of the pioneering commercial space entrepreneurs. Manber has been involved in several of the key breakthrough commercial space projects, principally those revolving around the commercialization of space assets as well as the integration of the Russian space...
later stated “ we failed to survive but proved the business model, and in the long-term that will be just as important.”
The company came to an end for a variety of reasons. It seems to have been a combination of the financial backers' inability to continue funding the venture, a business model that made little sense, and pressure by NASA
NASA
The National Aeronautics and Space Administration is the agency of the United States government that is responsible for the nation's civilian space program and for aeronautics and aerospace research...
to de-orbit the station. NASA viewed the station as a threat to its plans for the International Space Station. The station existed until March 23, 2001, at which point it was deliberately de-orbited, breaking apart over the Pacific Ocean.
Background
The company was formed as an idea by telecommunications and space investor Walt Anderson and space advocate Rick TumlinsonRick Tumlinson
Rick Tumlinson is the co-founder of the Space Frontier Foundation and a space activist. He has testified on space-related topics before the U.S. Congress six times since 1995...
. Russia lacked the funds to upgrade and save the space station, and had concluded it had no choice but to deorbit the station. Several ideas were floated, including one to hand over the Mir to the United Nations
United Nations
The United Nations is an international organization whose stated aims are facilitating cooperation in international law, international security, economic development, social progress, human rights, and achievement of world peace...
. The idea proposed by Anderson and Tumlinson was to save the Mir space station by raising it to a higher orbit to gain time and developing a “space tether
Space tether
Space tethers are cables, usually long and very strong, which can be used for propulsion, stabilization, or maintaining the formation of space systems by determining the trajectory of spacecraft and payloads...
” to supply power to keep the space station in orbit while further funds were raised. This plan was never implemented by the MirCorp team, as the United States government barred the export of the space tether technology until after the deorbit of the space station was announced.
The founders recruited well known space entrepreneur Jeffrey Manber
Jeffrey Manber
Jeffrey Manber is regarded as one of the pioneering commercial space entrepreneurs. Manber has been involved in several of the key breakthrough commercial space projects, principally those revolving around the commercialization of space assets as well as the integration of the Russian space...
, who had helped negotiate the first contract between the Soviet Union and NASA on space interests, and had also represented the huge Russian space company RSC Energia in its American dealings during the 1990s. Manber created the business model for the venture which involved proving that space could be a platform for media and entertainment, as well as serious space research
Research
Research can be defined as the scientific search for knowledge, or as any systematic investigation, to establish novel facts, solve new or existing problems, prove new ideas, or develop new theories, usually using a scientific method...
.
In February 2000, the agreement between the Russian space company RSC Energia, which had the commercial rights to the space station, and MirCorp, was announced in London. Present at the press conference was MirCorp CEO Jeffrey Manber and RSC Energia General Director Yuri P. Semenov. Also present at the press conference was co-investor Dr. Chirinjeev Kathuria, and Andrew Eddy, recruited from the Canadian Space Agency.
The news took senior NASA officials by surprise, and thus began the roller-coaster ride of the MirCorp efforts. Their efforts were criticized by many as a private interference with international space policies. Their desire to sell ticket to space as part of a “citizen explorers” program was ridiculed by NASA and its supporters.
Yet, as a result of the company’s backing, the RSC Energia officials boosted the Mir into a higher orbit, thus postponing the deorbit that had been agreed to by the Russian Space Agency in discussions with NASA. Manber later explained that the business model for the venture was modeled after that of air travel
Air travel
Air travel is a form of travel in vehicles such as airplanes, helicopters, hot air balloons, blimps, gliders, hang gliding, parachuting or anything else that can sustain flight.-Domestic and international flights:...
, where Boeing
Boeing
The Boeing Company is an American multinational aerospace and defense corporation, founded in 1916 by William E. Boeing in Seattle, Washington. Boeing has expanded over the years, merging with McDonnell Douglas in 1997. Boeing Corporate headquarters has been in Chicago, Illinois since 2001...
may build the planes but commercial agents such as United or British Airways
British Airways
British Airways is the flag carrier airline of the United Kingdom, based in Waterside, near its main hub at London Heathrow Airport. British Airways is the largest airline in the UK based on fleet size, international flights and international destinations...
sells the tickets. The intent was to have marketing experts sell the space program, and let the space manufacturer, RSC Energia, focus on the safe operations of the station. Manber explained that in the aviation world it was not the manufacturers who sold the tickets, it was the marketing companies. MirCorp and RSC Energia were the first to use this strategy for space exploration, which has emerged again more recently with Sir Richard Branson
Richard Branson
Sir Richard Charles Nicholas Branson is an English business magnate, best known for his Virgin Group of more than 400 companies....
’s announcement to market Scaled Composites
Scaled Composites
Scaled Composites is an aerospace company founded by Burt Rutan and currently owned by Northrop Grumman that is located at the Mojave Spaceport, Mojave, California, United States...
StarShip
Starship
A starship or interstellar spacecraft is a theoretical spacecraft designed for traveling between the stars, as opposed to a vehicle designed for orbital spaceflight or interplanetary travel....
suborbital flights.
It was also unusual as an international venture with Russia in the 1990s in that the Russians were given the operating control of the venture, reflecting the political realities of the importance of the Mir to the Russian society. RSC Energia owned 60% of MirCorp, whereas the financial investors controlled 40%. Investor Anderson explained that he was comfortable letting the Russians run the space component, and his team would run the business. “A lot of this venture is based on trust, pure and simple.” Anderson explained. Anderson was not so sanguine regarding NASA and used the media interest in the venture to launch many critical comments towards NASA, the planned International Space Station and even the foreign policies of the American government. This could not have but solidified opposition to the venture inside the Administration. Indeed, Anderson selected Holland as the headquarters for the company since he believed the country was far more ethical than that of his own.
Regardless of the controversy, a new era in space exploration was inaugurated on April 4, 2000, when the Soyuz TM-30
Soyuz TM-30
Soyuz TM-30 , also known as Mir EO-28, was a Soyuz mission, the 39th and final human spaceflight to the Mir space station. The crew of the mission was sent by MirCorp, a privately funded company, to reactivate and repair the station...
, known as the MirCorp mission, carried two crew members, Sergei Zalyotin
Sergei Zalyotin
Sergei Viktorovich Zalyotin is a Russian cosmonaut and a veteran of a two space missions.Zalyotin was born in Tula and attended the Borisoglebsk Higher Military School before becoming a fighter pilot in the Russian Air Force. He also holds a degree in ecological management. Zalyotin was selected...
and Alexandr Kaleri
Alexandr Kaleri
Aleksandr Yuriyevich "Sasha" Kaleri is a Russian cosmonaut and veteran of extended stays on the Mir Space Station and the International Space Station . Kaleri has recently been in space aboard the ISS serving as a flight engineer for the long duration Expedition 25/26 missions.- Personal :Kaleri...
, to the Mir space station.
The two man crew returned the dormant Mir space station to life, located the source of the leak, repaired the leak, and carried on commercial and basic research. Zalyotin admitted to being nervous when the hatch door was opened, not sure what exactly would be found in the station.
While the mission was being undertaken, the management of MirCorp was able to announce a number of commercial contracts, including that of the agreement with NBC
NBC
The National Broadcasting Company is an American commercial broadcasting television network and former radio network headquartered in the GE Building in New York City's Rockefeller Center with additional major offices near Los Angeles and in Chicago...
and Mark Burnett
Mark Burnett
Mark Burnett is a British television producer and executive producer, based in the United States. He currently is the executive producer of five network television series with seven hours of network programming. Works with which Burnett is associated have won multiple awards and recognition...
. NBC even began running commercials promoting its upcoming “Destination Mir” reality show.
On June 16, on schedule, the mission came to an end. It had lasted 73 days and the crew returned in good health. Behind the scenes, the MirCorp management and Energia space officials were both surprised at the technical and commercial success, but worried that the Mir would soon have to be shut for good.
On June 19, 2000, a press conference was held at the Russian Mission Control Center TSUP, at which the MirCorp president, along with RSC Energia head of International Development Alexander Derechin, announced that Dennis Tito, a former US space program engineer, who founded Wilshire, Associated—the Santa Monica, California-based company that revolutionized the field of investment management consulting, was MirCorp’s first “Citizen Explorer.”
Tito would subsequently withstand intense pressure brought on him and on Russian space officials, by NASA not to undertake his mission. NASA administrator Daniel Goldin
Daniel Goldin
Daniel Saul Goldin served as the 9th and longest-tenured Administrator of NASA from April 1, 1992, to November 17, 2001. He was appointed by President George H. W. Bush and also served under President William Jefferson Clinton and George W...
publicly rebuked MirCorp for their efforts during Congressional hearings. Tito went forward with his training and eventually, with the deorbit of the Mir, he transferred his efforts to fly on the International Space Station. With the help of RSC Energia, MirCorp and later Space Adventures
Space Adventures
Space Adventures, Ltd. is a Virginia, USA-based space tourism company founded in 1998 by Eric C. Anderson. , offerings include zero-gravity atmospheric flights, orbital spaceflights , and other spaceflight-related experiences including cosmonaut training, spacewalk training, and launch tours...
, he became the first space tourist to visit the International Space Station.
Dennis Tito
Dennis TitoDennis Tito
Dennis Anthony Tito is an Italian American engineer and multimillionaire, most widely known as the first space tourist to fund his own trip into space. In mid-2001, he spent nearly eight days in orbit as a crew member of ISS EP-1, a visiting mission to the International Space Station...
was not the first “amateur” to blast into space. Previously, Japanese TV journalist Toyohiro Akiyama had flown on a commercial mission to the Russian space station Mir. Tito was the first to pay for his own ticket, thus earning the designation of the first space tourist.
The Tito mission also took place in the backdrop of the whole controversy regarding the decision by the major Russian space company RSC Energia to work with MirCorp to create a commercial space station, and thus, many felt, put at risk the struggling Russia’s obligations on the planned International Space Station.
NASA’s behavior about learning of the Tito mission was unusual. The space agency immediately cancelled planned high level meetings between the Russian and US space agencies. Their legal team declared that a bill would be sent for any damages caused by the flight of Tito.
"In November 2000, we informed NASA that we planned to launch Tito to [Alpha]," said Koptev, who did not recall NASA expressing any negative reaction at that time. That situation changed, however, as the two space powers entered into a standoff in which neither would back down.
The head of the Russian Space Agency later told reporters that “Our legal advisors told us that the fine for any misdoing aboard the station, including damage to morale, could exceed the money that we had earned from Tito's contract, and could even exceed Russia's space budgetary capacity," Koptev said.
The reaction after the eventual mission to the International Space station, not to the Mir as initially planned, was harsh and personal. Dan Goldin, NASA administrator, implied that Dennis Tito was not an American patriot and US Sen. Barbara Mikulski
Barbara Mikulski
Barbara Ann Mikulski is the senior United States Senator from Maryland and a member of the Democratic Party. Mikulski, a former U.S. Representative, is the longest-serving female senator in U.S...
of Maryland compared the behavior of all those concerned with the space tourist program to that of “pimps.”
The Senator’s harsh views reflected many in Washington who regarded with disdain the concept of commercialization connecting with national space programs.
In addition, on several occasions the Russians claimed that they had not been reimbursed by MirCorp for services. MirCorp founder Walt Anderson was later charged with federal tax evasion, plead guilty, and was sentenced to nine years in federal prison.
Aftermath
By the end of the 73-day MirCorp mission, the company enjoyed a $70 million dollar backlog in customer orders. But the decision was made by Russia to yield to the American pressures and deorbit the station; in addition, the two financial investors were late on their payments and new investors were frightened off by the negative publicity from NASA.The company remained in business even after the Mir was destroyed. It handled the efforts of *NSync boy band Lance Bass
Lance Bass
James Lance Bass , best known as Lance Bass, is an American pop singer, dancer, actor, film and television producer, and author. He grew up in Mississippi and rose to fame as the bass singer for the American pop boy band 'N Sync. 'N Sync's success led Bass to work in film and television...
’s unsuccessful effort to fly to space, as well as that of former NASA official Lori Garver (currently Deputy NASA Administrator), who also sought to use advertising as a means to be a space tourist, before finally closing the doors.
MirCorp attempted to demonstrate that a private company could manage a manned space station; that a business model
Business model
A business model describes the rationale of how an organization creates, delivers, and captures value...
could be developed around an orbiting space station. However, its failure to produce sufficient revenue to pay its modest expenses and the imprisonment of one of its founders for tax evasion indicate that its efforts were unsuccessful.
Today the situation has changed. Former NASA administrator Michael D. Griffin
Michael D. Griffin
Michael Douglas Griffin is an American physicist and aerospace engineer. From April 13, 2005 to January 20, 2009 he served as Administrator of NASA, the space agency of the United States...
has voiced full support for commercialization of manned space activities and the Russian operated space tourist program is fully accepted by the United States.
The space tourism program has continued in Russia, which today enjoys far more robust funding than a decade ago.
External links
- Mircorp.org Web site
- SellingPeace.com
- New Scientist
- The Space Review - Documentary: "Orphans of Apollo", 2008
- The MirCorp Story, interview with Rick TumlinsonRick TumlinsonRick Tumlinson is the co-founder of the Space Frontier Foundation and a space activist. He has testified on space-related topics before the U.S. Congress six times since 1995...
, Daily Spaceflight News, 14 December 2010.