It’s too soon to say. The coverage of it has been disappointing so far as I’ve heard (just listening to Fox News getting ready to come to the office). They said that “if the Shuttle is damaged, NASA has to choose between repairing it on orbit, or abandoning the Shuttle and sending Atlantis up to rescue them.”

No. Repairing it on orbit is probably pretty much a non starter, but there’s another choice (and I suspect the most likely outcome). The Shuttle is damaged, but no more so than previous flights from which it has returned safely.

Thomas James gets to the nub of it:

Given the fact that foam has typically fallen off the ET on ascent, I have to wonder how much what concern there is over the insulation is motivated by new data: being able to actually see the problem happening for once, instead of only seeing the effect of foam shedding post-landing. Perhaps the ET routinely sheds cable-tray foam (or whatever it ends up being identified as) with no ill effects.

Losing a tile around the nose gear door, however, is a little more concerning. It’s hard to tell from the picture and the data provided so far how serious it is, or whether it too is in-family with prior tile damage.

“In-family” is NASA-speak for “within a class of previously-experienced anomalies.” I’m quite certain that NASA has an extensive data base of tile damage from every single flight, organized by section of the orbiter in which it occurred (and if they don’t, someone should certainly be keelhauled across Atlantis), and are even now scouring it to see if there was similar damage in a similar location on some previous flight, including notes of any structural insult observed when the offending tile was removed and replaced. That, and perhaps a closer inspection by EVA, will determine the resolution of this.

I think that it’s most likely that they will decide to come home with it as is. And if they do, I also think that they will undergo a great deal of ignorant criticism for this decision, because they’ve “lost their safety culture,” just one flight after they killed all those astronauts, and now they’re recklessly gambling their lives again (disregarding the fact that throwing away a two-billion dollar vehicle, and a third of the remaining fleet, is not a decision to be taken lightly either).