Expected reduction in funding for satellite imagery acquisition programs for the Pentagon, intelligence and national weather agencies of the United States is causing serious concern in the Earth remote sensing industry. Industry representatives warn, that such changes could deal a blow to the financial stability of commercial operators and put billions of dollars of investment at risk.
According to the head of the Commercial Space Federation, David Cavossa, risks jeopardizing the long-term health of the entire US remote sensing commercial ecosystem.
Quilty Space analyst Caleb Henry notes, that in all sectors — military, civil and commercial — the demand for satellite data in the US is declining. According to him, many operators overestimated the growth of the commercial market, but this did not happen. Therefore, companies turned to government orders, primarily to the Ministry of Defense, but it doesn't want to be a "single customer" either.
Special attention is paid to the budget of the National Intelligence Service (NRO), which manages the largest image acquisition programs. According to rumors, the amount of expenditure on commercial satellite imagery within the scope of the EOCL program (Electro-Optical Commercial Layer) can be reduced by 30%. Under this program in 2022 Maxar Technologies received the contracts, BlackSky and Planet for a total of up to $4 billion per 10 years.
Consequences:
- Companies like Maxar, Planet, Capella Space, ICEYE US, Umbra risks losing key customers.
- This could affect the ability of military commanders and emergency services to quickly receive satellite images.
- In the long term, other countries may invest in building their own satellite constellations, reducing dependence on the US.
Budget critics point out, that such reductions are contrary to US Space Policy 2020 year, which called for expanding the role of the private sector, and President Trump's decree from 15 April, which requires government agencies to purchase mostly commercial products.
Against this background, interest in own satellite projects is growing in Europe, and calls for "strategic autonomy" in defense and space could mean the loss of the US as a major partner for many countries.
Analysts warn: if the cuts are indeed approved, it may lead to the bankruptcy of some companies, whose business model was based on government support. At the same time, some operators are already looking for ways to diversify, for example, by selling satellite equipment or launching new services.