[Note: I asked Pat for permission to do a post about this announcement this afternoon, I figured it was good to have an occasional reminder that we are actually in the 21st century, and not all news is depressing news. -- Jon Goff]
Today NASA announced that it would be awarding contracts to Boeing and SpaceX to complete development of vehicles for carrying astronauts to and from the International Space Station. These contracts (up to $4.2B in the case of Boeing, and up to $2.6B in the case of SpaceX) cover not only the remainder of development and certification tasks needed by both providers to enable the first manned demo flights of their respective to ISS in late 2017, but also covers up to 6 crew transfer flights to ISS after that. These awards were "firm fixed-price" FAR contracts, which means that the companies get paid the fixed amount they bid, broken up over a series of technical milestones--if they don't complete a given milestone, they don't get paid, and if things cost more than expected, the companies themselves eat the difference.
For those wondering why Boeing got more than SpaceX, it is simply that they proposed a higher price for completing the same milestones. NASA wanted to have two providers, to make sure that they don't get stuck in a situation where they cannot access their $100B space station in case one vendor has issues with their vehicle or the launcher that boosts it to orbit. There was a third developer, Sierra Nevada Corporation, who was not selected for contract award, presumably because NASA felt that their vehicle was either more risky, or more expensive than those proposed by SpaceX or Boeing.