The UK Government has committed £2.3 billion to military satellite communications over the financial years 2026/27 to 2029/30, according to Defence Industry Europe. The pledge forms part of a wider £2.8 billion satellite communications package and appears in the UK Space Strategy published on 8 September 2026.

The Ministry of Defence will establish a unified approach to government satellite communications procurement, coordinating requirements across departments through what the strategy terms the Enterprise Space Category. This represents a significant consolidation of fragmented departmental demand.

SKYNET remains foundation for sovereign defence communications

SKYNET will continue as the foundation for sovereign, sensitive defence communications and services to NATO allies. The government's approach combines sovereign capabilities with allied cooperation and commercial services to provide flexible connectivity.

The £2.3 billion defence allocation will fund satellite communications services for the UK Armed Forces over the four-year period. The strategy identifies satellite communications as a requirement for national security and resilience, supporting military operations, diplomatic communications and emergency services.

Importantly, the strategy document does not identify the £2.3 billion as funding for constructing new SKYNET satellites. Rather, the funding covers satellite communications services across the defence estate during this financial planning window.

Unified procurement model across government

The Ministry of Defence will coordinate satellite communications requirements and procurement across government departments through the Enterprise Space Category. This model draws on experience elsewhere in defence and extends that approach to space services and technologies across the wider public sector.

The coordinated approach aims to achieve several objectives:

• Secure services more effectively than numerous smaller, individual procurements
• Pool government demand to improve efficiency
• Identify requirements that might otherwise remain unrecognised across fragmented departmental budgets

By 2030, the government aims to publish an integrated national satellite communications architecture. This will establish interoperability standards, unified commercial procurement structures, updated spectrum access rules and central coordination mechanisms.

By 2035, the stated objective is continuous communications for defence, security, crisis response and emergency services. The architecture will combine sovereign systems, partner capabilities and commercial services to deliver resilience across both civil and defence communications.

Technology development and industry support

The satellite communications package includes £429 million for industrial technology development. This funding covers ESA's Advanced Research in Telecommunications Systems (ARTES) programme, the UK Space Agency's Connectivity in Low Earth Orbit programme and ESA's Moonlight programme for a dedicated lunar telecommunications and navigation constellation.

The government wants defence users to access advances in satellite communications technology in areas including direct-to-device services, terminals that roam across services, and quantum and optical technologies. ESA's European Centre for Satellite Applications and Telecommunications at Harwell provides facilities for this development work, supported by a 5G/6G hub.

The strategy also highlights a UK-funded AI laboratory for satellite communications to help industry gain expertise in emerging architectures.

At least £75 million will fund satellite communications for public services, including low Earth orbit services for users in the UK and Overseas Territories. This allocation includes activities to improve Emergency Services Network resilience and low Earth orbit technology for Wi-Fi connectivity on UK mainline trains.

Multiple operators and competitive market structure

The government intends to encourage multiple operators to provide access to different connectivity options. Open standards and interoperability will allow their capabilities to work together, with competition supporting innovation.

The Ministry of Defence will establish clearer routes to market for suppliers through the Enterprise Space Category. These will include frameworks managed by the Government Commercial Agency, with defence demand also signalled through the National Armaments Director Group.

A published cross-government pipeline will identify forthcoming space opportunities, making demand more predictable for suppliers. The government will consider acting as an anchor customer where it has clear capability requirements.

Procurement will also support domestic supply-chain resilience. The strategy identifies the Technological Capital framework used in SKYNET as one mechanism for securing access to critical skills, facilities and capabilities. The government may require certain activities to take place in the UK to strengthen freedom of action and industrial resilience within an international supply chain.

Context: UK satellite communications market

Satellite communications generated £3.53 billion in UK space industry income in 2022/23, representing more than 36% of the sector's total income. The strategy identifies further growth markets in aviation, maritime services, autonomous systems and direct-to-device connectivity, alongside integration of satellite services with terrestrial 5G and 6G communications.

By 2035, the government wants UK industry to supply commercially successful equipment and services operating across multiple orbits at scale, with UK-based research, infrastructure and manufacturing supporting that objective.

The government will assess whether the coordinated procurement model can be extended to other space activities beyond satellite communications as the first application of its plan to combine departmental demand with defence expertise.