[I'm kind of surprised this hasn't been posted about already, so
something I wrote yesterday to here.]

This is a very exciting week for private spaceflight! In addition to
the Virgin Galactic announcement, hotel entrepreneur Robert Bigelow (of
Bigelow Aerospace) has mentioned plans to announce a $50 million
orbital space prize, to a team which produces a commercial space
transport capable of sending 5-7 passengers to a Bigelow inflatable
space module by 2010. This will be dubbed "America's Space Prize."
There's an article with photographs available he

http://spaceflightnow.com/news/n0409/27bigelow/

press release: http://biz.yahoo.com/prnews/040927/nym082_1.html

The inflatables themselves are quite interesting, with a docking
mechanism designed to attach with either a Russian Soyuz, a Chinese
Shenzhou, and/or whatever vehicle comes out of the aforementioned
America's Space Prize. A one-third size prototype of the inflatable
module will be launched in 2005 on the maiden flight of SpaceX's Falcon
V rocket, which is itself a very interesting vehicle (~3000kg into LEO
for $12 million, and the first orbital vehicle designed to be man-rated
since the space shuttle). The first full-size inflatable habitat will
be up by 2008, and it's planned to have a crew by 2010.

Robert Bigelow was also the founder of Budget Suites of America, and is
applying a lot of the cost-cutting tricks he learned from his previous
contracting experience to the aerospace industry. He licensed the
Transhab technology from NASA (which had previously had its funding
cut), and is subcontracting for things like life support from other
companies who already have systems running.

What's exciting about this is that the inflatable modules appear to be
designed, built, and have undergone some preliminary tests. The
outsides of the modules have withstood projectile impact tests fairly
well. Pretty much all that needs to happen now is for them to undergo
further tests and be launched. Bigelow's use of multiple contractors
for the same part will allow him to ramp up production if there's a
demand for it, and sell the inflatable modules for ~$100 million each
to whoever wants them.

Regarding the prize itself, I'd actually be quite interested to see if
somebody ends up just designing a docking/descent capsule and sticking
it on a Falcon V.