On National Security | DoD’s internet-in-space a win for commercial space

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The Pentagon’s space agency is buying 126 small satellites for $1.8 billion to build a communications network in low Earth orbit known as the Transport Layer.

The Space Development Agency is overseeing the Defense Department’s first major procurement of small satellites in low Earth orbit, a trend that has accelerated in the commercial industry as companies plan ever-larger megaconstellations. Also notable is that one of the prime contractors selected by SDA to build the Transport Layer is a commercial satellite manufacturer that has never won a large defense contract.

“It’s a major shift in DoD space procurement,” said Derek Tournear, the director of SDA.

People talk about the “disruption” that SDA is bringing to the DoD space business, he said. The proliferation of small satellites in LEO is certainly one type of disruption; another is the selection of purely commercial companies for big-ticket awards.

Two-thirds of the 126 satellites will be built by defense contractors Lockheed Martin and Northrop Grumman — who won $700 million and $692 million contracts, respectively. York Space Systems got a $382 million contract for the other third.

While the number of companies in the defense industry has shrunk over the past 30 years due to consolidation, hundreds of new players have entered the commercial space business. A DoD report said satellite manufacturers supporting military programs dropped from eight in the 1990s to four today. SDA’s selection of York Space brings in a new supplier, boosting competition in the market.

Chuck Beames, executive chairman of York Space, called the SDA program a “big deal” for obvious reasons and because of what it means for the future of commercial space – particularly for small satellites that have been a sideshow for years rather than the main event.

York Space was founded in 2015 to make satellites more like consumer electronics, which has been made possible by the miniaturization of components and mass production. In the national security market, small satellites have been “interesting things to demonstrate and experiment with,” Beames said, pointing out that the Transport Layer is finally giving small satellites a seat at the big boys’ table.

The Pentagon for years has talked about the need for change in space programs in order to capture commercial innovation and diversify its architecture dominated by very large geostationary satellites that cost billions of dollars apiece.

A LEO constellation moves DoD closer to a “hybrid architecture” with a mix of satellites in different orbits, providing more resilience against cyberattacks or anti-satellite weapons.

DoD also is transitioning to smaller satellites for weather imaging. General Atomics, a defense contractor, in 2017 acquired smallsat manufacturer Surrey Space Technology to compete for DoD contracts.

The company scored a big win last month when it was selected by the Space Force to launch a demonstration weather imaging satellite in 2024. Gregg Burgess, vice president of space systems at General Atomics Electromagnetic Systems, said this could lead to more orders down the road.

“This is really part of a revolution that smallsats have brought, where now you can provide a capability that larger satellites did on a smaller platform,” said Burgess.

Tim Lynch, vice president of L3Harris Space and Airborne Systems, said the company “struck gold” when it started pivoting from making hosted payloads to making smallsats about five years ago. The company saw the potential to buy off-the-shelf parts and avionics and integrate them. Because of the success of its smallsats, he said, L3Harris built a new business around the concept of “responsive space” for military and intelligence agencies.

What SDA is doing today with smallsats is partly owed to efforts by the Defense Advanced Research Projects Agency, a longtime advocate of commercial space.

Former DARPA director Steven Walker observed in 2018 during a roundtable with reporters that DoD has “very exquisite satellites” that cost too much and take too long to build and launch. ”We have been saying this for 10 years: We want to see a shift to LEO and get capabilities in larger constellations.”


Sandra Erwin

 

Sandra Erwin covers military space for SpaceNews. She is a veteran national security journalist and former editor of National Defense magazine.

“On National Security” appears in every issue of SpaceNews magazine. This column ran in the March 2022 issue.