Report Urges Smarter Space Partnerships as Agencies Lean on Industry
New Commercial Space Federation Study Says NASA, DoD Must Better Match Contract Types to Risk, Market Realities and Demand Signals to Avoid Cost, Schedule Hits in Future Programs
A new industry-backed report urges U.S. space agencies to overhaul how they design and manage public-private partnerships, warning that poor planning and muddled risk-sharing could undermine future space programs even as commercial capabilities expand.
“Success requires careful planning, involvement of appropriate experts, and understanding of market conditions and program characteristics.”
Excerpt from the CSF PPP report
Commissioned by the Commercial Space Federation and authored by Rational Futures, the February 2026 study, “Perfecting Public-Private Partnerships: The Future of Government Space Contracts,” argues that risk ownership — not contract labels — should define how NASA, the War Department and other agencies buy space services. The paper contends that agencies too often conflate public-private partnerships, or PPPs, with specific tools such as firm-fixed-price contracts, creating unrealistic expectations about costs and performance.
The report frames government procurement on a spectrum from traditional programs, where the public sector retains all major financial, construction, technical, operational and business risks, to commercial development, where a private firm carries them all and sells services to both government and non-government customers. PPPs sit between those poles, sharing risk in different combinations. “Success requires careful planning, involvement of appropriate experts, and understanding of market conditions and program characteristics,” the authors write, noting that results from PPPs across sectors have been “mixed.”
To improve outcomes, the study lays out mechanisms at three levels: agency, program and contract. At the agency level, it calls for building internal capacity beyond engineering — including finance, economics, legal and procurement expertise — and for establishing a centralized “control tower” to coordinate industry engagement, maintain capability surveys and provide a single front door for companies. The report cites the U.S. Space Force’s “Front Door” office as an example of such an enterprise-focused hub.
Program-level recommendations include conducting robust, independent market assessments, signaling clear multi-year demand, and supporting multiple suppliers where feasible to balance competition, redundancy and industrial base health. In nascent markets, the paper warns that overly optimistic demand projections can drive schedule slips, vendor distress and higher costs, as seen in recent lunar delivery efforts.
At the contract level, the report urges officials to match procurement arrangements and contract types to technology maturity, market depth and mission needs. Cost-plus contracts remain appropriate where government is the sole early customer and technical risk is high, while firm-fixed-price deals and Other Transaction Authority agreements can better support PPPs and commercial development when requirements are stable and markets broader. The authors also emphasize committing to clear, goal-focused requirements and using block buys to secure economies of scale and give investors confidence.
Using NASA’s Commercial Orbital Transportation Services program as a flagship example, the study credits cost-sharing, multiple suppliers, stable “what not how” requirements and large follow-on resupply contracts with seeding a multibillion-dollar cargo market and lowering average mission costs over time. By contrast, the Commercial Lunar Payload Services initiative is presented as a cautionary tale about optimistic market assessments, shifting oversight and requirement changes that contributed to delays and cost growth.
The report concludes that as NASA, the Space Force and other agencies lean more heavily on industry, they must institutionalize lessons learned, develop analytical tools for smarter buying, and continuously reassess how criticality, complexity, capital needs and market conditions shape the right mix of public and private risk.