WASHINGTON — The Department of the Air Force is reconsidering its procurement of satellites for a low Earth orbit military constellation, pausing funding for the program in fiscal year 2026 while examining whether SpaceX’s Starshield satellites could provide the same capabilities at lower cost.
The Trump administration’s proposed 2026 budget would suspend procurement of data-transport satellites for the Proliferated Warfighter Space Architecture (PWSA), a mesh network of satellites designed for secure communications and missile tracking operated by the Space Force’s Space Development Agency. The outcome of the review could impact the procurement of as many as 140 satellites for Transport Layer Tranche 3, which the SDA had planned to order in 2026 for deployment in 2028.
Chief of Space Operations Gen. Chance Saltzman confirmed the possibility of this shift during a June 26 congressional hearing, telling the Senate Appropriations Committee’s defense subcommittee that the service will pursue an analysis of alternatives to determine the way forward.
“Now we have to look at what are the other avenues to deliver, potentially, a commercial, proliferated low Earth orbit constellation,” Saltzman said. “So we are simply looking at alternatives as we look to the future as to what’s the best way to scale this up to the larger requirements for data transport.”
The PWSA represents one of the Space Force’s flagship programs, designed to create a resilient network of hundreds of satellites in low Earth orbit that can communicate with each other and track missiles. The program has been structured around regular competitive procurements, with different “tranches” or batches of satellites awarded to various contractors to maintain competition and drive down costs.
Saltzman assured lawmakers that the satellites already ordered for the first two tranches of the transport network will continue to be funded and deployed as planned.
Starshield alternative
The potential alternative centers on SpaceX’s Starshield program, a militarized version of the company’s commercial Starlink broadband satellites. News that the Pentagon was considering this first surfaced in March when Sen. Kevin Cramer (R-N.D.) questioned Air Force Secretary nominee Troy Meink during a confirmation hearing about budget discussions regarding the PWSA program.
The option under consideration is to replace Tranche 3 satellites with spacecraft that the Space Force plans to procure from SpaceX for a “Milnet” network of 480 Starshield satellites that the company would operate for the U.S. military. These satellites would use optical laser cross-links to pass data between spacecraft as part of a broader “hybrid mesh network” that integrates both military and commercial satellites.
Unlike the competitively procured PWSA satellites, Milnet satellites would be funded by the Space Force and procured under an existing contract managed by the National Reconnaissance Office to deploy a proliferated low Earth orbit network supporting intelligence and military users.
Competition concerns
The potential shift has raised concerns among lawmakers about reducing competition in the defense space sector. Sen. Chris Coons (D-Del.) pressed Air Force Secretary Troy Meink during the June 26 hearing about the implications of potentially handing a major contract to a single vendor.
“No competition, no open architecture, no leveraging a dynamic space ecosystem. This is a massive and important contract,” Coons said. “Doesn’t handing this to SpaceX make us dependent on their proprietary technology and avoid the very positive benefits of competition and open architecture?”
The senator’s concerns reflect broader Pentagon efforts in recent years to foster competition among space contractors and avoid over-reliance on single vendors for critical capabilities.
Meink said no decisions have been made regarding the use of Milnet for data transport. “How we field that going forward into the future is something that’s still under consideration, and we will look at the acquisition of that,” he said.
Industry impact
The potential cancellation of Transport Layer Tranche 3 could significantly impact satellite manufacturers and their supply chains, which have invested heavily in building capacity to support the SDA’s programs. Companies have been assured that the PWSA would create a sustained market with regular competitive opportunities.
The Space Development Agency, which manages the PWSA program, has a budget of approximately $5 billion in 2026. The agency has positioned the program as a cornerstone of the Pentagon’s strategy to maintain space superiority through large numbers of satellites that would be difficult for adversaries to destroy or disable.
Industry sources said the planned procurement of the Milnet network has raised questions about potential duplication with the PWSA Transport Layer and whether the two programs could be combined. Such consolidation could streamline the Pentagon’s space architecture but would also eliminate competitive opportunities that have driven innovation and cost reductions in the sector.
