The premise is that the present forms of attempting to develop commerce in space is fundamentally defective in two ways: 1) It is too risky and expensive to start "big", that is, with a conventionally sized launch system. 2) There is not actually a market in launch services for 1000 pound class satellites.

An example of the first point is that no such venture has succeeded as of March 2006. The first Falcon launch in Kwajalein has over 100 million at risk (see http://thespacereview.com/article/489/1 )

There is not enough demand or applications for large satellites to support an industry. The Orbital Sciences Pegasus system has had only 36 launches in their over 15 year lifetime. A launch rate of one each 5 months.

See http://www.microlaunchers.com/ for the presentation of the case for starting "small".