No one knew at that stage just what a good investment it would be: Ariane is now the most successful commercial launch system in existence. Far from living in Nasa's shadow, it has eclipsed its rival and cornered a 60 per cent share in the market for launching commercial television and communications satellites into high Earth orbit. As countries deregulate their broadcasting networks, the market for satellite television is growing. The Internet is stretching the terrestrial phone network to its limit, and satellites are poised to take the strain. Arianespace - the company which markets and operates launches on Ariane rockets - now makes more than pounds 700m a year. But Britain, a reluctant partner in Europe's space enterprise, has so far failed to match the enthusiasm and expertise for space found in our universities and aerospace companies with cash from the government.
Although a member of Esa from the start, Britain's input was always tiny compared to France, Germany and, Italy - the UK's contribution to research and development for the Ariane 4 just 3.6 per cent. In 1987, Kenneth Clarke, the then trade and industry minister, announced that the UK was going to have nothing to do with the new Ariane 5, despite the fact that the French at least believed that with a communications revolution on the horizon, the potential was there to make billions. As well as pulling out of Ariane 5, Britain announced that it was going to have nothing to do with the development of manned space missions; and Britain's financial contribution to Esa was frozen.
"In hindsight it really was very short sighted of Clarke,'' says Alastair Scott, PR director of Matra Marconi Space, a British-French company that makes parts for the Ariane 4 rocket. "The Europeans regard us as being rather two-faced when it comes to Esa, standing on the sidelines watching to see if it is going to be a success and then, if it is, jumping in."
The Tories were never keen on publicly-funded space projects. The feeling was that while spending on pure science was acceptable, the commercial sector could be left to its own devices. In the early 1980s, Bob Parkinson, an engineer with British Aerospace, came up with a cheap reusable space plane that could be developed and launched for a fraction of the cost of the Shuttle. The "Hotol" (Horizontal Take-off and Landing) space plane would be able to take off and land from an airport runway, and could even, some claimed, be adapted for commercial sub-orbital hypersonic passenger flights - bringing Sydney to less than an hour away from London. However, the government, understandably mindful of the Concorde money pit two decades earlier, wanted nothing to do with it and Hotol remained on the drawing board. (Bob Parkinson was on the receiving end of another dose of ministerial caution last month, when civil servants representing Esa pulled the plug on the EuroMoon project, which would have seen a satellite and lander designed by Parkinson arriving at the Moon shortly after the millennium.)
The Thatcher administration's lukewarm support for Europe's commercial space venture seems to have been rather perverse. True, this was in the days before deregulation and satellite dishes were 6ft across and cost thousands of pounds. But media analysts knew what was coming. The technology was there, and the US, with its cable network in place since the 1950s, had shown the demand for multichannel broadcasting. Rupert Murdoch, then a close friend of the Tories, was planning an onslaught on the British airwaves. At first everyone laughed at him, but no one is laughing now that the BSkyB satellite broadcasting company, in which Murdoch has a 40 per cent controlling share, has an annual turnover of more than pounds 1bn.
Even more bizarre was the timing of Britain's decision to pull out of Ariane 5 - the year after Nasa, Arianespace's main competition at the time, had been dealt a crippling blow when the Space Shuttle Challenger exploded, killing seven astronauts. "That provided us with, how do you say, a window of opportunity," says Claude Sanchez, a spokesman for Arianespace.
Under Esa's rules, Clarke's decision meant that no British company could bid for contracts on the new launcher but the rules were bent to allow some contracts to be awarded. "Britain got in by the back door," says Sanchez. "There was certain expertise that no one else could reproduce, so companies like Matra Marconi were awarded contracts to build parts." Since 1987, Esa's rules on "juste retour" have been relaxed slightly, allowing companies to bid for Ariane contracts regardless of their governments' contribution to the project.
Which was fortunate, because now the Ariane launchers are serious money earners. "We make about 7bn French francs a year [pounds 700m], and the amount of tax paid on the profits has wiped out the governments' contribution," says Sanchez. The commercial space market has expanded so much in the last decade that launch companies struggle to keep up with demand. Launches from Guyana are now routine, monthly occasions that pass unnoticed unless there is a mishap, such as the failure of the first Ariane 5 launch in 1996, and the money is rolling in. Telecommunications satellites provide much of the custom - with around 270 now dotted around the planet, beaming thousands of channels in dozens of languages to just about every point of the globe. Mobile telephony is another huge market. The Iridium constellation - a fleet of 66 low-Earth orbit satellites - is nearly half way in place. Iridium will provide fast, reliable communication from mobile handsets anywhere on Earth, with none of the time delay and expense associated with high-orbit geostationary link-ups. In 2001, the first of the next generation of multi-media communications satellites will be launched. The Celestri fleet will see a fleet of 70 very large satellites - each three metres long and weighing 3.5 tonnes - launched into low Earth orbit to provide full global multi-media communications. At the same time, Microsoft chief Bill Gates is planning a fleet of 188 multi-media satellites that will form the backbone of his Teledesic network. In a recent market assessment for the DTI, accountants Booz, Allen and Hamilton estimated a global market for satellite multimedia services of up to $12bn (pounds 7.23bn) by 2010.
There are signs that the Labour administration may be rethinking its attitude to the Esa. On 16 March, John Battle, the science minister, told Esa's Director-General, Antonio Rodota, that Britain would be increasing its contribution to the agency by pounds 21.2m. A small step maybe, but a giant leap compared to the at times negative stance taken by the previous administration. !Reuse content