UPDATED 11:10 a.m. EDT, August 16, 2005

A go-ahead was given last week by the U.S. Department of State's Directorate of Defense Trade Controls (DDTC) that clears the way for exchanges of technical information between Scaled Composites of Mojave, California and Virgin Galactic of the United Kingdom to build passenger-carrying suborbital spaceliners.

Among its duties, DDTC administers and enforces International Traffic in Arms Regulations (ITAR).

"Putting it in ITAR terms...this is one small step for ITAR, one big leap for Virgin Galactic," said Will Whitehorn, President of Virgin Galactic--the space tourism endeavor that is a subsidiary of British entrepreneur Sir Richard Branson's Virgin Group.

"It allows us to activate all the parts of the project," Whitehorn told SPACE.com in an exclusive phone interview, such as use of technology--SpaceShipOne's reentry concept and hybrid rocket motor design, for example--that can be licensed through Paul Allen's Mojave Aerospace Ventures.

Whitehorn said that the DDTC has approved a request for a Technical Assistance Agreement (TAA) between Scaled Composites LLC, Virgin Galactic LLC, and Virgin Management Ltd. This does not require the issuing of a license as such.

The request itself for the TAA was made by Scaled Composites on behalf of the three companies, Whitehorn said.

Because Scaled Composites is the deemed exporter of 'technical' information to Virgin--being a non-U.S. group--the request to enter into a Technical Assistance Agreement with Virgin had to be formally submitted to the DDTC by Scaled," said Jonathan Peachey, Virgin's Vice President of Finance and Business Development.

DDTC's approval to the request by Scaled Composites allows all three parties to enter into a TAA under which the exchange of technical information will take place, Peachey told SPACE.com.

Allen, a Microsoft mogul and billionaire, bankrolled the development of the piloted SpaceShipOne--designed by Burt Rutan and his Scaled Composites team--that repeatedly flew to the edge of space last year--snagging the $10 million Ansari X Prize in the process.

Building the fleet

Last month, Branson, announced that he had teamed up with aerospace designer, Burt Rutan of Scaled Composites to form a new aerospace production firm: The Spaceship Company.

Details about the new company were unveiled at the Experimental Aircraft Association's (EAA) AirVenture air show held July 25-31 in Oshkosh, Wisconsin.

The Spaceship Company will build a fleet of commercial suborbital spaceships and launch aircraft. Scaled Composites is to be under contract for research and development testing, as well as certification of a 9-person SpaceShipTwo (SS2) design, and a White Knight Two (WK2) mothership to be called Eve.

Whitehorn said last week's clearance to begin the exchange of technical information was a process spread over five months time. The DDTC understood the commercial rather than the military nature of the project, he said, and bodes well in the long-term, perhaps, for other private-sector space efforts.

"Most private space project that have existed so far haven't come across the issue of the DDTC, ITAR, and export regulations for these kind of technologies from the United States," Whitehorn said. "We're really the first people who have probably gone through a formal process of this nature and come through the other end of it. So I think that's a good precedent."

Next steps

The DDTC green-light is between Virgin Galactic and Scaled Composites, enabling the development and operation of the SpaceShipTwo for the U.S. market. "Exporting the technology to a third party country would be another issue...and one that will have to be addressed in the future," Whitehorn added.

Whitehorn said that next steps can now be taken to construct SpaceShipTwo, hopefully, in the next 8 months, and all of the things that lead up to building the vehicle.

The location to produce the fleet of rocket planes is very likely to be Mojave, California. "That's where we expect to be in production," Whitehorn said, although the takeoff site of Virgin Galactic's public space trips is a different matter.

Given the urban sprawl of Los Angeles and growing encroachment on the desert around Mojave, Virgin Galactic may look for another home as an operational business site, Whitehorn said.

"We are already in discussion with a number of states in the United States," Whitehorn said, as well as Mojave, California. Two launch sites are a possibility, but that is not a given at the moment, he noted.

Hard work ahead

"The thing that I find really heartening is the willingness on the part of the U.S. government to make sure that this fledgling industry does prosper in the private sector," Whitehorn said, and not to "stifle the baby before it's born."

Whitehorn said that Virgin Galactic is "generally encouraged on all fronts at the moment." Still ahead...some two-and-a-half years of hard work in developing The Spaceship Company, he said.

At the Mojave locale, SpaceShipTwo shakeout testing and reaching a level of safety in vehicle operations are top action items. Launching the space tourism business is projected around 2008, Whitehorn explained, although that date is not carved in stone.

Downpayments on going up

The "going rate" for seats onboard Virgin Galactic suborbital spaceships are price tagged at $200,000 each.

"We have a significant level of deposits now...nearly $10 million worth," Whitehorn said. Some people are paying the full price to be founders and some are putting down deposits to fly in the future, he said.

"We'll be in the position by the time we actually launch this business...I'm sure we would have sold out at least the first couple of years by the time we start flying," Whitehorn speculated.

A full-scale mock-up of SpaceShipTwo is to be unveiled in the near future, but not this year, Whitehorn said: "We'll be keeping our light under a bushel [basket] for competitive reasons for some time."