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Bryan Luk

Leonard Luk

The excitement around SpaceX, fuelled by the targeted US$1.8 trillion valuation for its initial public offering and its promising Starship rocket development, has revived a familiar claim: that SpaceX is on course to dominate the space market.
Commercially, that view is understandable. SpaceX conducts more space launches than anyone and at very competitive costs, its Starlink satellite internet company provides strong in-house demand, and it has a scale advantage unmatched by any other private space company.
But space is no ordinary, commercial, open market. It is a strategic domain where launch, satellite communications, remote sensing and orbital infrastructure are tied directly to sovereignty, security and industrial policy.
Governments do not choose space providers the way consumers choose smartphones. The central question is not only who offers the best technology or lowest cost, but also who can be trusted with critical infrastructure, sensitive data and long-term dependency.
In this light, the bullish assumption that SpaceX will simply overwhelm international markets becomes much less persuasive.
SpaceX is deeply embedded in the US strategic system, with military implications – such as in the Russia-Ukraine and US-Iran wars – and closely associated with its founder Elon Musk, whose political profile is prominent and polarising. While this may reinforce SpaceX’s position in the US, particularly in defence and national security programmes, it can produce the opposite effect abroad. Foreign governments will have to consider if reliance on SpaceX creates excessive political exposure or national security issues.


This is not unique to SpaceX. It reflects a broader turn towards space market protectionism, or at least selective strategic screening. Governments are trying to reduce dependence in sectors they increasingly see as dual-use and security-sensitive.
The European Union, for instance, has made this logic explicit. The EU space strategy makes independent, reliable and cost-effective access to space a political imperative and it aims to act as a smart customer of European launcher solutions, prioritising EU-based space service providers. Autonomous and secure access to space is being framed as part of ensuring freedom of action, independence and security.
Its Infrastructure for Resilience, Interconnectivity and Security by Satellite (IRIS²) constellation is built on the same strategic premise: that space infrastructure is not just a commercial asset but also a sovereign one tied to resilience, security and digital autonomy.
That means market access in space is filtered through alliance politics, regulatory review, local industrial participation and sovereign capability goals. The result: a fragmented market more heavily divided in the name of national security than many investors assume.
Some private space companies, no longer competing on engineering and price alone, are reshaping themselves to navigate geopolitical friction – by building a local industrial footprint, acquiring assets in trusted jurisdictions, forming joint ventures and presenting themselves as politically and internationally more adaptable partners.

Rocket Lab offers a useful illustration. Founded in New Zealand in 2006 by Peter Beck, the company has clearly sought to broaden its appeal beyond the US market. Its portfolio includes clients from Japan (Astroscale Japan Inc, Canon, iQPS), Germany (OroraTech), France (Unseenlabs) and Canada (NorthStar Earth & Space), alongside American customers, reflecting its credibility.
Part of that appeal lies in its profile: while deeply integrated with the US space ecosystem, it does not carry the same political weight as larger American champions. Its New Zealand origins and more international operating identity make it a more geopolitically portable partner for markets seeking advanced Western space technology without excessive dependence on a single, dominant US firm.
Besides customer diversification, Rocket Lab uses acquisitions to deepen its technological capabilities and strengthen its access to markets, especially those where the space sector and market is strategically important and closely protected. Its recent acquisition of Munich-based Mynaric was revealing.
On one level, this is a straightforward vertical integration move, giving Rocket Lab access to laser optical communications technology, which is increasingly important for proliferated satellite constellations and secure next-generation networks. On another level, it reflects a broader strategic logic: building a stronger foothold inside Europe to compete for European Union contracts.
Yet the Mynaric acquisition also reflected increasing security concerns. Rocket Lab announced its intention to acquire Mynaric in March last year but final approval from Germany’s Federal Ministry for Economic Affairs and Energy did not come until March this year, with the deal closing only in mid-April.


Even for a company regarded as less politically charged than SpaceX, the takeover of a European space technology firm still triggered lengthy regulatory scrutiny. It shows how governments now view the space sector: not simply as a commercial arena, but as strategic infrastructure where ownership, control and jurisdiction increasingly matter.
This is precisely the kind of situation that may be more politically difficult for SpaceX. It is not that SpaceX lacks capability. It is that we expect more governments to be reluctant to let SpaceX become structurally indispensable to their strategic infrastructure.
That is why the space economy is unlikely to be shaped by engineering and market price alone. It will shift to a landscape shaped more by trust, security screening, industrial sovereignty and geopolitical fit. SpaceX may remain the sector’s most formidable commercial power and Starship may widen its technical lead. But the global market will not be a fully open terrain.
In a world of growing space protectionism, space companies that can navigate multiple jurisdictions, soften political concerns and embed themselves in local industrial ecosystems may enjoy the broader international runway and market share.


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Space is not an ordinary, commercial, open market but a strategic domain tied directly to sovereignty, security and industrial policy


Space is not an ordinary, commercial, open market but a strategic domain tied directly to sovereignty, security and industrial policy.


SpaceX

Space

Elon Musk

Starlink

Aerospace: Industry Trends

European Union

Aerospace: Policy

Aerospace: Geopolitics

New Zealand

Germany

Canada

Defence

Internet

War and conflict

United States

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


For SpaceX, global dominance may not be written in the stars

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Space is not an ordinary, commercial, open market but a strategic domain tied directly to sovereignty, security and industrial policy

Space is not an ordinary, commercial, open market but a strategic domain tied directly to sovereignty, security and industrial policy