The person said Google will invest about $30 million for a minority stake in the company, though the investment could grow substantially.
The talks were first reported by Sky News, [LINK:http://news.sky.com/story/1280919/google-in-talks-to-take-virgin-galactic-stake] which said Google’s investment would value Virgin Galactic at around $2 billion. Virgin Galactic declined to comment. A Google spokesman declined to comment.
The talks come amid a flurry of deals and investments being made by Google to gain more data and beam Internet access from various layers of the atmosphere. It has purchased Titan Aerospace, a startup that is developing solar-powered drones; its Google X skunkworks is testing balloon-powered Internet as part of its Project Loon.
Meanwhile, Google is expected to use the satellite technology it just acquired from Skybox Imaging, which is a specialist in providing imagery of the Earth’s surface, to help beam broadband from space.
Separately, Google is also rolling out Google Fiber service in more cities in the U.S., building fiber optic networks in Uganda to help local Internet service providers deliver faster connection speeds as part of Project Link, and leasing dark fiber while bringing online new submarine and underground cables.
Google makes the vast majority of its profits from Web search advertising, which should only increase as Internet access becomes more widespread and speeds increase.
A deal would provide an important vote of confidence in Virgin Galactic, which has suffered years of delays and nagging problems with the engines of its passenger spaceship. The company is gearing up for its first test flight outside the atmosphere later this year, and if all goes well could begin regular commercial service by early 2015.
But its supplemental satellite-launching system still needs to undergo airborne testing, and commercial flights are expected to be spread out significantly in the beginning.
As Google considers its options, there are a few other companies that could provide launches for its small satellites. Alliant Techsystems Inc.ATK +0.36%, Orbital Sciences Corp.ORB +0.48% and Sierra Nevada Corp. all have rockets that could do the job, while startups such as closely-held Xcor Aerospace Inc. could develop the capability in coming years.
In addition, Space Exploration Technologies Corp. has larger rockets primarily designed to launch larger satellites, but those systems can be adapted to carry small satellites as secondary payloads.