[Lokibob]

A number of replies mention "Orbit" and orbit is not the goal of this aircraft nor of the x-prize.

The $10,000,000 will be paid to the first team that achieves 100 KM (62 miles), has 3 passengers, and repeats the feat within 2 weeks.

The goal of the x-prize is to encourage travel in near space, and to demonstrate reliability. Once these goals are achieved, it is expected that capitalism will take over bringing the price even further down.

If the government were running this program, the costs would far exceed the $10,000,000 prize pot.

[RightWhale]

I understand Rutan has already invested over $30 million. Of course he would do this even if there were no prize. If he is successful, many doors will open to him.