Overview
We choose to go to the Moon in this decade and do the other things, not because they are easy, but because they are hard. – John F. Kennedy, 1962
Countries no longer choose to go to space; they have to.
US-Soviet competition at the peak of the Cold War thrust the world into the space age, defined not only by intergovernmental competition and national pride, but also by economic necessity. Since 1965, corporations have sent assets into orbit to claim market share in telecommunications, television broadcasting, remote sensing, and weather monitoring. Space-based infrastructure has lowered costs and improved productivity on Earth by enabling services that support most of the world’s economy.
Today, a new space race has taken off. Driven by falling launch costs, rapid private-sector innovation, and intensifying strategic competition between the US and China, space represents both a commercial market and a domain of national power. While the depths of space are infinite, viable opportunities are finite. Being first in space is no longer merely a symbolic act of planting a flag on the moon. Rather, it secures the most valuable places to operate, where you can build the infrastructure that could make it cheaper for later arrivals to become customers instead of competitors. That infrastructure could make space a place to manufacture specialized materials and medicines, generate energy, and extract resources, creating new products for Earth and the means to sustain economic activity beyond it. As the US and China compete for primacy in space, the stakes of showcasing the supremacy of their differing innovation ecosystems are on full display. This time, the contest will be measured not only by extraordinary national achievements; the outcome will shape which companies and countries build and profit from the next economy, and the terms on which everyone else can access it.
Building an Economy Beyond Earth
The next frontier is the establishment of infrastructure beyond earth. Microgravity could make it possible to manufacture exotic materials or pharmaceuticals that are difficult or even impossible to produce terrestrially, while vast orbital data centers could rise as the computing foundries of space by reducing latency for satellites. Governments and companies are developing the ability to service spacecraft and assemble structures in orbit, where immense platforms could be built piece by piece, unconstrained by the dimensions of a rocket’s payload fairing or the violence of launch. Instead of forcing every mission to provide those systems independently, shared infrastructure could serve many customers at once. An extraterrestrial research mission, for example, could purchase access to an existing communications relay rather than finance a network of its own. By spreading fixed costs across more users, providers can reduce the capital each new entrant must commit before beginning operations.
The moon presents further opportunities. Near its south pole, elevated terrain receives prolonged sunlight beside permanently shadowed craters believed to contain deposits of water ice. If that ice can be extracted and separated into hydrogen and oxygen, it could supply rocket propellant beyond earth. Producing propellant in space would reduce the amount future missions must haul out of earth’s gravity well, freeing scarce launch capacity for equipment and cargo. The lunar surface itself could also become a source of industrial feedstock: oxygen and metals locked within its regolith could be extracted and used to build and sustain infrastructure. The same soil contains helium-3, a scarce isotope that could become valuable for advanced fusion or quantum technologies. The moon would begin to function as humanity’s off-world energy and logistics hub.
That possibility creates a powerful incentive to build before the market is fully formed. Early providers can claim prime operating locations, accumulate experience, attract customers, and encourage later missions to be designed around their services. As usage grows, scale and technical integration can reinforce that advantage. A later competitor would need not only to build a credible alternative, but to persuade customers that the savings or improvements justify the cost and risk of switching. Being first does not guarantee dominance, but infrastructure that others rely upon can become difficult to displace.
A New Era of Competition
Private companies helped build the first space age, yet governments largely chose the destination and paid the bill. Today, commercial firms can build and own the infrastructure itself, commit their own capital, and sell services far beyond a single national mission. The US and China, the two leaders of the new space race, are utilizing different variants of this same model to achieve their goals.
In the American model, companies develop and own space assets while the government purchases the services they provide. Unlike in the Apollo era, the company can use the same asset to serve other customers. Under NASA’s Commercial Lunar Payload Services program, NASA buys the delivery rather than the lander, leaving companies to retain the spacecraft and sell capacity to other missions. By supplying demand before a wider market fully exists, NASA can help companies prove their technology, build an operating record, and attract additional business, allowing a government mission to seed recurring commercial capacity.
China is pursuing the same commercial prize through a more deliberately orchestrated system. Its 2025–2027 commercial-space plan opens state testing facilities and research results to commercial companies, marshals public and private capital, expands government procurement, and directs diplomatic channels to help Chinese firms win business abroad. In April 2026, CNSA put that strategy into practice by opening 20 publicly financed testing facilities to commercial companies, letting new entrants draw on infrastructure the state had already paid to build. A young company can therefore draw on a national support system rather than trying to build everything by itself. By lowering those barriers, China is trying to compress the time needed to turn emerging firms into globally competitive space suppliers.
Commercial success in space adds to national power. The Pentagon increasingly purchases services from private operators for American military operations, a shift represented in its 2024 commercial-space strategy, which treats continued access to those services during crisis and conflict as a military concern. That relationship cuts both ways: commercial scale gives Washington capabilities it would struggle to reproduce alone, while placing critical military functions on infrastructure the government neither owns nor fully controls.
As commercial and military roles converge, access to space can no longer be taken for granted. Space Force leadership has described its transformation as turning a “merchant marine into a navy”: moving from supplying services in a relatively secure environment to preparing to preserve access when that environment is contested. US doctrine has treated control of the air as a prerequisite for military success since World War II; today, Space Force’s 2025 Space Warfighting framework extends that doctrine to space, calling it a “necessary precondition for Joint Force success.” China faces the same strategic problem, assigning its Aerospace Force responsibility for securing access to and use of space.
The Implications of the Next Economy
The infrastructure built during this race could shape not only who profits from the space economy, but what that economy becomes. Reliable transportation back to earth would make orbital manufacturing more attractive to companies selling into terrestrial markets, while lunar power and surface transportation would encourage businesses designed to operate on the moon. As infrastructure makes some activities cheaper than others, capital will flow toward the opportunities that become viable first, strengthening the systems already in place. Government procurement could therefore leave a legacy far beyond the missions that first justified them, not by telling companies what to invent, but by making some ideas far cheaper to pursue than others. That said, while government orders can help bring these services into existence, their wider commercial value will depend on whether other customers follow.
The effects will reach companies that never operate a spacecraft. Suppose an orbital process produces a material that improves the performance of machinery manufactured on earth. Access to that process could become a competitive advantage for terrestrial manufacturers, with the benefits appearing in markets far removed from aerospace. A country could retain its manufacturing capabilities while depending on another country’s space infrastructure for an important production stage. Industrial dependence would no longer require moving a factory abroad but could emerge from incorporating a new capability beyond earth.
The same competition building the next space economy could also divide it. As American and Chinese companies establish communications networks and transportation systems around potentially incompatible standards and operating requirements, multinational firms may find themselves navigating parallel markets. Serving both could require separate equipment, contracts, and technical systems, raising costs and making it harder to switch providers. The risks extend beyond commerce. As private satellite constellations and services become intertwined with military operations, infrastructure built for ordinary customers could become increasingly exposed to conflicts between the governments that depend upon it. The race may therefore create extraordinary new opportunities but leave companies more exposed to a geopolitical contest they did not choose to enter.
The consequences of this race will ultimately be measured by more than what the US and China build for themselves. As other countries and companies enter the market, many may purchase services rather than recreate those systems from the ground up. But while a new frontier does not automatically produce a new distribution of economic power, the foundations laid during this race could carry existing advantages into industries the world has not yet invented.
