Programs, Budgets Challenge Military Space

Space assets play a vital role in current and perceived future battlefield needs, with communications satellites an important part of networking forces. But program problems and budget restrictions are combining to change thinking on how capabilities should be developed and deployed.

The U.S. military has an insatiable demand for bandwidth, and the Air Force had hoped its new Transformational Satellites (TSAT) would revolutionize satellite communications. But high costs, technical delays and budget ­constraints prompted Defense Secretary Robert Gates to cancel the program in 2009. The Pentagon will instead focus on buying more examples of the available Advanced Extremely High-Frequency (AEHF) and Wideband Global Satcom (WGS) satellites.

TSAT’s cancellation is part of a wider trend in U.S. space spending. Rather than develop advanced and expensive satellites with revolutionary technology, the Pentagon is adopting an evolutionary approach. An example is the Operationally Responsive Space (ORS) model, under which the U.S. hopes to create smaller, less expensive satellites that can be developed and launched much more quickly. These will offer only incremental capability but, by avoiding the high-risk development of “exquisite” systems, the Pentagon hopes to minimize the cost growth and delays that have plagued programs such as TSAT.

Satellites developed under ORS would not completely replace the big-ticket, next-generation space programs, but in a tight budget environment they are likely to receive increased consideration.

Even with a reduced budget, the U.S. spends an enormous amount on military space compared with the rest of the world. Overall, the Pentagon is expected to spend $4.2 billion on space procurement and $4.1 billion on research and development in Fiscal 2011. In the next 10 years, the U.S. will account for 77% of global military satellite sales; Europe will be a distant second, with 9.3% of sales. Countries such as Russia, China and Israel are increasing their military space spending and, by the end of the 10-year forecast period, Asian countries will outpace Europe with 12.5% of the market.

Europe’s major military space players—France, Germany, Italy, Spain and the U.K.—are pursuing individual programs, such as Germany’s SARLupe and France’s Helios reconnaissance satellites. Some are combining efforts to save on costs. France, Germany and Italy have data-sharing agreements for their current reconnaissance satellites. France and Italy recently agreed to collaborate on a new Syracuse 3 military communications satellite. These agreements will likely continue and expand with next-generation satellites.

The need to increase satellite capacity and capabilities—communications and reconnaissance—is forcing many militaries to turn to commercial operators. In July 2010, the U.S. issued a solicitation for communications satellite services under the Future Comsatcom Services Acquisition (FCSA) program. Multiple contracts could be worth up to $3.5 billion over five years. FCSA will consolidate contracts previously awarded by individual agencies as well as state and local governments.

U.S.-based DigitalGlobe and GeoEye each have contracts under the EnhancedView program to provide remote-sensing data to the U.S. National Geospatial-Intelligence Agency. If all options are exercised, each company could be awarded more than $3.5 billion in the next 10 years.

To meet satellite capability needs, governments are also paying commercial satellite operators to host government payloads. This is much cheaper than deploying a dedicated satellite or spacecraft network and gives the government flexibility to deploy a single payload where it is needed most on a satellite close to launch. The commercial operator, in return, gets an extra revenue stream.