It's electrical. Think about this: when you launch a rocket 90 percent of it's mass, including engines, structure & fuel, is thrown away. That's alot of expensive hardware to just throw away. An Orbital Skyhook doesn't throw away any hardware. All hardware is retained. A rocket can only launch one payload, but there is no limit to how many payloads a Skyhook can launch, as long as you keep supplying electrical power and maintaining existing hardware.

A rocket is hardware limited. One shot, one payload. That's it. Build a new rocket. A Skyhook is energy limited. A few hundred megawatts of electricity spread out over a year, and you get 17,000 payloads* into orbit. But you don't throw away a Skyhook. Next year you keep using the same hardware, just keep the juice flowing, and the payloads keep launching. Most of the mass and hardware of the Skyhook is already in space, orbiting at 2000 km altitude. It never comes down. Even if the tether snaps, only the tether has to be replaced, the orbiting mass, the most expensive part of the Skyhook, is still up there, orbiting, waiting to be used. A rocket launch fails, the whole thing self-destructs, a total write-off.

*You wouldn't have to launch 17,000 payloads. But at least you wouldn't have to build a brand new rocket for each one.