This is the biggest misconception people have about NASA partnering with SpaceX

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space shuttle Endeavour

Reuters/NASA

The space shuttle Endeavour, built by Rockwell International, is silhouetted against the Earth's horizon before docking with the International Space Station in 2010.

The hoopla surrounding every SpaceX rocket launch makes it seem like this is the first time NASA has partnered with companies.

But that's hardly the case.

Tech Insider spoke with astronaut Byron Lichtenberg, who flew two missions to Spacelab in the 1980s and 90s and now chairs a standing review board that oversees NASA's Commercial Crew Program - an arrangement with companies to ferry supplies and astronauts into space.

Lichtenberg said NASA itself has rarely built space equipment.

"Ever since day one with the Mercury Program, NASA has contracted with companies to actually build the rockets," he said.

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What has changed is the way NASA is contracting with companies.

Back in the early days of the Space Race, Lichtenberg said, people had no idea how much rockets would cost. So NASA used what it called "cost-plus" contracts that paid companies the cost of making a rocket, plus either a fixed fee or a percentage.

Profit-wise, this was a pretty sweet deal for companies like Lockheed Martin and Boeing, but they didn't get to own the rockets or technology they built - NASA did. The agency also had a lot more say in determining how the spacecraft were designed and what tests they needed to pass.

spacex crs8 launch

SpaceX/Flickr

SpaceX's Falcon 9 rocket launches supplies to the International Space Station on April 8, 2016.

These days, companies have pretty much figured out how much to charge NASA to make rockets, so the agency uses "fixed-price" contracts. The companies quote NASA a price, and the space agency doesn't have to pay them more if they end up going over that number.

"With the fixed-price contracts, NASA has less ability to dictate the design or the way the companies are doing things as long as the companies meet the NASA requirements," Lichtenberg said. "Now, the companies own the design; they actually own the vehicles; and NASA in a sense is just renting rides to the [International] Space Station."

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And because the companies now get to hold onto their intellectual property, they have the opportunity to commercialize their rockets and eventually take civilians onboard.

Who knew a mundane contract change could get you to space?

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