Bitcoins, space tourism, and the benefits and perils of exclusivity

On Friday, Sir Richard Branson and Virgin Galactic found yet another way to get into the news. Friday morning, Branson announced that his commercial space company would accept payment in the form of bitcoins, a cryptocurrency that has attracted increasing attention in recent months as its value has skyrocketed. A single bitcoin is worth more than $800 as of midday Sunday, according to the bitcoin exchange Mt. Gox, and reached $900 earlier in the week; just a month ago, a bitcoin traded for $200. In a blog post, Branson said one customer, an unnamed flight attendant in Hawaii, already paid for her Virgin Galactic ticket in bitcoins.

Of course, in many respects this news is primarily fluff, designed to ride the growing interest in bitcoin. We don’t know, for example, who this Hawaiian flight attendant is, why she decided to pay in bitcoin, or even she paid the full $250,000 ticket price in equivalent bitcoins or a smaller deposit amount. Branson, in an interview, said Virgin Galactic immediately converted the bitcoins into conventional currency, rather than holding onto the bitcoins. In essence, the bitcoins were more commodity than currency, as if someone elected to pay for a ticket using gold bullion—but paying in gold would be less interesting, or hype-worthy, than paying in bitcoin.

What’s more interesting about the announcement is how it was made. While Virgin published a blog post, Branson made the announcement first in a live interview Friday morning on CNBC TV (see video above). That choice is not surprising, and not because CNBC is a major business television network: CNBC is owned by NBCUniversal, which two weeks earlier announced an “exclusive partnership” with Virgin to cover the first commercial SpaceShipTwo flight next year. “NBC News’ award-winning Peacock Productions will chronicle the journey across a myriad of NBCUniversal brands and platforms including MSNBC, CNBC, SYFY, The Weather Channel and NBCNews.com,” the companies said in the statement, with a primetime special the night before the flight, which will be shown on NBC’s “Today” show.

For Virgin, that partnership is likely a good deal. Virgin gets access to a major television network, with plenty of opportunities to tell its story to a diverse group of audiences. And NBCUniversal likely expects to get a lot of attention and viewers—and advertisers—for the behind-the-scenes coverage it will apparently have exclusive access to. (The release makes no mention of any money, bitcoin or otherwise, changing hands between the two companies.)

One wonders, though, how beneficial it will be for other media, the general public, and even Virgin itself in the long term. NBC won’t have an exclusive on the first flight itself, entertainment trade publication Variety reported, but “would have direct access to a feed of footage inside the ship during its run and would be able to talk to Branson and his children while they are in the vehicle.” However, knowing that they’ll not have the same access as NBCUniversal, will other media outlets devote as much attention to Virgin Galactic as it ramps up to its first flight as they might have otherwise? Will NBC feel as free to scrutinize Virgin Galactic’s efforts, including its delays and concerns about its hybrid rocket engine, as it would be without its partnership with the company?

We can see, perhaps, a microcosm of that in the Virgin Galactic bitcoin announcement. CNBC got the exclusive, and while Virgin published a blog post with much of the same details shortly thereafter, it lacked the opportunity to ask questions about the announcement. The media coverage that followed had a “me-too” feel to it, largely regurgitating the announcement and details from the CNBC interview without adding much additional detail. To be fair, it’s not clear that, even without the Virgin-NBC deal, the media would have covered this relatively minor announcement much differently.

What’s clear is that, for better or for worse, media relations in the commercial space sector are different than those for government-run programs, where there’s a greater expectation of a level playing field. (Of course, that hasn’t always been the case, an example being the deal the early NASA astronauts had with Life magazine.) Companies can play favorites if they feel it’s in their best interests. However, there’s always the danger of a backlash if they go too far in that direction.