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THERE’s a construction boom in the desert south of Truth or Consequences, New Mexico (population roughly 7000). Concrete is being poured, boundaries are being staked and every now and then trailers arrive, briefly forming the nuclei of small, impromptu camps. It doesn’t look like much now, but in a few years the skies above this spot will ignite as those with both wealth and a sense of adventure realise a lifelong dream. This is where Richard Branson’s fledgling company, Virgin Galactic, will blast paying passengers into sub-orbital space. This is Spaceport America.

Dreams don’t come cheap, however. State officials have agreed to cough up a cool $100 million toward the project’s $250 million construction cost, while a big chunk of the balance will be borne by Branson. And in April, New Mexico voters agreed to use a proportion of their sales-tax dollars as extra funding for Spaceport America’s construction. With the funding secured, Spaceport America is set to open in 2009 or 2010.

Behind this public investment are hopes for a strong economic return. By its fifth year, Spaceport America could employ 2300 people on a payroll of about $300 million, according to a recent by New Mexico State University. Those are the kind of numbers that sway lawmakers and voters alike.

A decade ago, the prospect of spending serious cash on a commercial spaceport would have been laughable. What’s remarkable now is that Spaceport America is one of many popping up around the world. According to the Federal Aviation Administration in the US, the nation has seven “non-federal” spaceports in operation – facilities not run by the military or NASA. At least another nine, including Spaceport America, are being planned there, while others are springing up in Europe, Canada, Australia and elsewhere.

The spaceport boom is a highly visible sign of how quickly the commercial space sector is growing, though the term “commercial space” is a loaded one – companies like Boeing and Lockheed Martin have space-age roots going as far back as NASA’s. To distinguish themselves from such military-industrial giants, whose space-related income has always mostly come from governments, the new wave of commercial space pioneers refer to their industry as entrepreneurial space, “alt.space” or even “NewSpace”.

Whatever you call it, a new space age has begun. Much of the technology is the same as it was in the old one, however. Despite nearly two decades of presentations heralding the imminent arrival of self-propelled spaceplanes, everyone is still using chemical-powered rockets to reach orbit. Even Virgin Galactic’s upcoming space-tourist vehicles are more an inspired reworking of existing rocket technology than anything revolutionary.

So if it isn’t technology, what is this boom all about? The answer is a heady brew of bravado, bare-bones innovation and the vague promise of vast riches. Crucially, space entrepreneurs believe that they – not NASA or the aerospace giants – represent the true future of activity in space. Innovation, they say, is a cure for the malaise of state-funded space programmes mired in space-race nostalgia or militaristic one-upmanship. Now they’re hoping to prove themselves by opening the heavens to private enterprise.

There has been an entrepreneurial space sector since the late 1970s, but for years it had little traction. Early space entrepreneurs were often science fiction enthusiasts with bags of passion but minimal engineering credentials. Today’s entrepreneurs share that passion, but are backing it up with something just as critical: mountains of cash.

“The rich guys building their own rocket companies are the primary change,” says Gary Hudson, a veteran space entrepreneur who now heads AirLaunch, a company based in Kirkland, Washington, that designs and builds small experimental rockets. He estimates that as much as $500 million in private funding is now in play through various alt.space companies, much of it from entrepreneurs like Branson, Microsoft co-founder Paul Allen, Amazon.com’s Jeff Bezos, and Elon Musk, who made his fortune from PayPal, the internet payment system.

Even half a billion dollars pales in comparison with the $16 billion NASA is playing with this year, but the investment is clearly working. After decades of slow struggle, the alt.space triumphs are suddenly coming thick and fast. Hudson and other entrepreneurs credit the sector’s change in fortune to legendary spacecraft designer Burt Rutan and his spaceplane SpaceShipOne, which scooped the $10 million Ansari X prize in 2004 by completing a historic double flight into sub-orbital space. Crucially, SpaceShipOne achieved this on a modest budget of about $25 million. “Burt’s X prize victory was huge,” Hudson says.

More innovations followed. In July 2006, Bigelow Aerospace launched Genesis 1, a crewless prototype for a space station and the first private habitable spacecraft in orbit. Its remarkable inflatable design is based on technology from a mothballed NASA project called TransHab. In June this year, Bigelow sent the more complex Genesis 2 into orbit with a cargo of items sent up by the paying public.

A few months later, Bezos’s company Blue Origin demonstrated its Buck Rogers-style rocket, Goddard. The remote-controlled, dome-shaped craft took off and rose nearly 100 metres before touching down on its four legs, upright all the while.

Two other US-based rocket companies, Rocketplane Kistler and Musk’s SpaceX, could begin testing new orbital vehicles as early as next year. And let’s not forget Rutan’s follow-up craft, SpaceShipTwo, still cloaked in secrecy. It is scheduled to begin flying the first Virgin Galactic passengers as early as the end of 2009 from a spaceport in the Mojave desert, California, though a fatal explosion there in July will probably delay the schedule.

The robustness of the rookie space sector is revealed by its growing ability to operate independently of the established military-industrial players. Early alt.space ventures have invariably relied on government funding, expertise or launch facilities, but won’t for much longer. Although Bigelow space stations are currently lofted on Russian rockets, they are scheduled to fly aboard SpaceX’s Falcon 9 rocket by 2010. Rutan’s vehicles are likely to be powered by engines built by SpaceDev or any number of other entrepreneurial companies that have, like Bigelow, proved their ideas with working hardware rather than slide shows.

It’s all a far cry from the first serious private rocket effort. Hudson’s Percheron rocket exploded on its Texas launch pad in August 1981, and there was never a Percheron 2. Hudson and his investors had barely found the money to build the first rocket and, critically, they had no customer base from which to draw further funding.

Compare Percheron’s story with that of SpaceX’s Falcon rocket, which despite years of development and two test flights has yet to fly in space. Both Falcon launches suffered that stopped them short of orbit, yet Musk declared the second flight a success. He has also continued to develop more powerful rockets such as the Falcon 9, which will be able to lift a human crew into orbit. Much of this confidence flows from Musk’s deep pockets. Just as important, however, is that SpaceX has customers waiting in line with money in hand.

The frenetic pace of the alt.space revolution creates concerns that there may not be sufficient demand in the medium to long term to justify such investment. Can pioneers like Rutan and the all-star teams assembled by the likes of Bezos and Musk break through the technology and cost barriers that have stumped NASA for decades and turn that all-important profit?

Rutan seems to think so. His secured several patents and won the admiration of aerospace engineers worldwide. He is proud of the choices he made with the vehicle’s design. “Our difference,” he says, “is that we committed to develop a commercial system that will fly large numbers of the public out of the atmosphere.” It’s that kind of attitude, as much as Rutan’s formidable design record, that helped him secure development funding from Allen and, later, Branson’s operational investment.

Surprisingly, perhaps, one of the biggest alt.space customers is NASA, long seen as the nemesis of the sector (see “Banking on the small guys”). Last year the agency awarded nearly $500 million to SpaceX and Rocketplane Kistler to develop and demonstrate “test vehicles” that could take cargo and crew to the International Space Station (ISS). If these prototypes perform, NASA has pledged to buy operational versions.

Despite the apparent change of heart, many alt.space players are suspicious. “It’s largely window dressing,” says Hudson. He and other sceptics point out that NASA has paid Lockheed Martin almost $4 billion, eight times as much, to develop the Orion capsule, which is essentially a competitor to SpaceX’s Dragon capsule and Rocketplane Kistler’s K-1 crew-and-cargo vehicle.

Other entrepreneurs suggest it would be imprudent for NASA to put all of its eggs in the private basket so early. “The ISS gives the NewSpace industry the opportunity to prove it can operate profitably in place of a government service,” says Chirinjeev Kathuria, chairman of space-tourism company PlanetSpace in Chicago. “It is doing more than any other programme to support and encourage the NewSpace industry.”

Most space entrepreneurs are wary of NASA’s enormous coffers, however. Insider blogs and a variety of industry reports are highlighting the high costs NASA faces as it develops Orion and the Ares rockets, which together are to replace the space shuttle. The capsule’s small crew capacity means it could cost more to send each human into orbit using Orion and Ares than it did with the shuttle, says Rutan. He remains convinced that the entrepreneurial sector will do better.

“Since private teams spend their resources more efficiently, we might be within eight years of the point where there is more value from private research versus NASA research,” says Rutan. Watch this space.