For two decades, largely in service to the International Space Station, NASA has sought to foster an “economy” in low-Earth orbit.

Twenty years ago, with a program to develop private spacecraft for cargo delivery to the space station, NASA sought to “stimulate efforts within the private sector to develop and operate safe, reliable, and cost-effective commercial space transportation systems.” In recent years this has expanded to creating an entire commercial ecosystem in orbit, with transportation, space stations, manufacturing, tourism, and more, such that NASA is one of many customers in the market.

In April 2024, the space agency explicitly laid out its philosophy: “NASA supports a robust commercial space economy that advances American industry and promotes technological discovery through in-space work and research. NASA remains committed to fostering innovation and collaboration within the American space industry.”

But just two years later, there are growing questions about the viability of this. As the second space race heats up, NASA has become more interested in focusing on the lunar surface, with a robust Moon base. SpaceX has signaled it no longer wants to be in the business of flying astronauts into low-Earth orbit. Today, the grand plans for a low-Earth orbit economy, at least involving humans, appear to be going sideways.

So what happened, and why does it matter? Ars spoke with a number of industry sources, on background, to provide some answers.

Q. What precipitated this crisis?

A. In recent months, SpaceX has made it clear to NASA that it no longer wishes to fly its Crew Dragon spacecraft, or the Falcon 9 rocket, on missions to low-Earth orbit. The company has agreed to support the International Space Station until 2030. But after that, SpaceX intends to retire the spacecraft. SpaceX has told companies developing private space stations for low-Earth orbit, including Axiom Space, Voyager Space, and Vast Space, that they cannot order Crew Dragon missions for their habitats.