The US Space Force, long content with using just one or two contractors to carry the military’s most vital satellites into orbit, has announced it will seek a third provider for national security launch services in its next multibillion-dollar round of rocket procurement.
This is good news for Blue Origin, which has long sought to join the ranks of United Launch Alliance and SpaceX as the military’s preferred launch contractors. The Space Force has spent the last few months refining how it will purchase launch services for military satellites and National Reconnaissance Office spy payloads in the late 2020s and early 2030s.
Pardon the jargon
In February, the Space Force unveiled a “dual-lane” acquisition strategy that will include two tiers of space missions.
The military’s terminology in this area is filled with jargon. Essentially, the Space Force wants more launch providers to increase competition and reduce the military’s reliance on one or two companies. ULA and SpaceX are currently the only providers certified to launch national security space missions. So instead of grouping all these launches into one monolithic contract, the Space Force is dividing them into two classifications: Lane 1 and Lane 2.
Lane 1 will involve launches of more risk-tolerant missions. Those include smaller tech demos, experiments, and launches for the military’s new constellation of missile tracking and data relay satellites, an effort that will eventually include hundreds or thousands of spacecraft managed by the Pentagon’s Space Development Agency.
Rockets eligible for Lane 1 must be able to lift at least a metric ton (2,200 pounds) of payload into low-Earth orbit on a single flight. The military has a separate contracting mechanism to buy launches for lighter payloads, such as CubeSats.
Missions placed in “Lane 2” in the Space Force’s procurement approach will include the government’s most sensitive and costly national security satellites. These are often large, heavy spacecraft used for surveillance, weighing many tons and sometimes needing to go to orbits thousands of miles from Earth. Lane 2 missions also include GPS navigation satellites, which are not quite as expensive on an individual basis but are critical for a broad swath of military and civilian applications.
That’s where the Space Force has amended its launcher acquisition strategy over the last few months following consultations with industry representatives and a more clear-eyed assessment of how many missions the military and the NRO could fly to space over the next decade.
Instead of picking two companies to compete for these Lane 2 missions, the Space Force will now select three. Reflecting the change, the military’s Space Systems Command last week released a new draft of its request proposals for the upcoming launch services competition known as “National Security Space Launch Phase 3,” which covers five years of launch orders beginning in fiscal year 2025 (starting October 1, 2024), plus a follow-on five-year option period.
The Lane 2 contract winners will need to have medium-to-heavy lift rockets that can place payloads into nine reference orbits, ranging from low-Earth orbit a few hundred miles above the planet up to geosynchronous orbit, a lofty perch more than 22,000 miles (nearly 36,000 kilometers) over the equator. Lofting a satellite directly from Earth’s surface into geosynchronous orbit in a single shot requires advanced capability that has only been mastered in the US by ULA and SpaceX.
“The Lane 2 missions are the most challenging missions,” said Col. Douglas Pentecost, deputy executive officer for Space Systems Command’s assured access to space. “These are the ones that are billion-dollar payloads going to unique orbits. Just to be blunt, they’re precious and required to meet the threats that are facing this nation. So we want 100 percrent mission success.”
Here's a quick overview of the terms:
Lane 1: Smaller, less proven rockets supporting large satellite constellations and military tech demos (about 30 missions)
Lane 2: Larger, more proven rockets for heavier payloads going into higher orbits (about 58 missions)
Phase 2: The Space Force's previous rocket procurement round, which selected ULA and SpaceX as winners in 2020
Phase 3: The Space Force's ongoing rocket procurement round, which aims to broaden the base of companies for military launches
More missions, more problems?
Space Force officials disclosed more details about the launch strategy shakeup Wednesday in a teleconference with reporters. Originally, the launch acquisition team only looked at the White House’s proposed budget for military space missions. With that information, the Space Force projected it would need to order launch services for about 60 missions in the Phase 3 procurement round, including both lanes.
After casting a wider net with Space Force satellite development teams and the National Reconnaissance Office (which owns US government spy satellites), Space Systems Command determined there was actually demand for up to 90 national security space launches in the Phase 3 ordering period starting in late 2024—around 58 in the more exclusive and expensive Lane 2 and another 30 or so in Lane 1.
“As we talked to our stakeholders and looked at the market, looked at the capacity that’s happening, the amount of launches that are happening, we made the determination that in order to really assure access to space that adding a third provider into what we’re calling Lane 2 was good for the nation,” Pentecost said Wednesday.
But it’s not just the projected launch volume. Military officials said they’re also concerned about resilience. At a time when the US military says it is facing new threats in space from China and Russia, what happens if a company’s rockets are grounded due to a failure or supply chain problems? What if a launch company goes out of business or leaves the market?
“Let’s say something happens,” Pentecost said. “Maybe one of the two has a grounding event and can’t fly. Maybe something happens with that company. We’ve seen some small launch companies recently go out of business. While I have no worries about our big companies, we just wanted to protect ourselves so that over these next five years, we will have three guys that we have access to to meet these critical needs.”
Pentecost said the Space Force wants to release the final request for proposals for the Phase 3 launch procurement by September, with industry proposals due in December. Space Systems Command, the military’s space procurement hub, wants to select the three Lane 2 winners and an unspecified number of Lane 1 launch providers no later than October 2024.
To get a contract award next year, the Lane 2 launch providers must show a plan for their rockets to be certified for national security launches by October 1, 2026—a bar that requires multiple successful missions, detailed technical reviews by the Space Force, and a capability for vertical integration of their payloads. Those launch providers must also fly their missions from the military's launch ranges in Florida and California. Space Systems Command’s draft request for proposals suggests the military will prioritize technical factors like launch vehicle capability and risk in its decision-making for Lane 2. But other criteria, like past performance and price, will also receive consideration.
In Lane 1, the military is taking a more light-touch approach. There are no certification requirements for the Lane 1 launch providers, and there's no limitation on where they can launch. The procurement approach for Lane 1 allows companies to "compete on their terms," said Col. Chad Melone, a senior material leader working in the military's space acquisition department.
"When we look out there and we see all this stuff happening and all the emerging launch providers... it's clear that there's a huge move afoot. So we're trying to leverage that," Melone said.
A number of companies with medium-lift or heavy-lift rockets in development, such as Rocket Lab's Neutron and Relativity Space's Terran R, appear to be well-positioned for Lane 1. There's a chance the Terran R and some of the other larger rockets, with modifications, could eventually meet the more stringent lift and orbit requirements for Lane 2.
“We have multiple providers on Lane 2," Malone said. "We hope it’s not just ULA, SpaceX, and Blue Origin competing for that. There are others who have messaged interest in the past.”
“They all have plans to develop a medium-lift (vehicle)," Pentecost said, referring to the commercial US launch industry. "Everybody has determined that the small launch market isn’t where it’s at.”
A company can bid for, and win, contracts for both Lane 1 and Lane 2 missions. So it’s conceivable that a company like SpaceX could propose using its already-certified Falcon 9 and Falcon Heavy rockets for Lane 2 missions, which require more proven launch vehicles, and offer its new-generation Starship rocket, still in development, for the military’s more risk-tolerant Lane 1 missions.
The military will select the top three Lane 2 proposals and rank them first through third. Space Systems Command’s updated strategy would split out seven of the Lane 2 missions to give to the contractor with the third-best proposal, then divide the remaining 51 in a 60/40 split between the launch providers with the first- and second-best bids.
That effectively means one company would get around 30 Lane 2 missions, another would get about 20, and the third would get seven. If one company stumbles, the Space Force would have the option of moving satellites to the other rockets certified for Lane 2 missions.
But there's another catch. If a company's rocket hasn't successfully flown to orbit, the Space Force won't actually select that vehicle to launch a specific mission.
Space Systems Command awards individual mission task orders in a group once per year. Let's say Blue Origin is one of the winners of the Phase 3 procurement, but its heavy-lift orbital-class New Glenn rocket still hasn't flown when it's time for the military to divide up that year's launch task orders (its first flight is probably still one or two years away). In such a case, Blue Origin wouldn't be eligible to get any missions for that year.
“We’re trying to get away from actually ordering a mission before you have proven that you can fly," Pentecost said.
The Space Force will also provide additional support contracts for up to $100 million per contractor in the Lane 2 segment. Those subsidies will pay the companies to maintain infrastructure that is unique to military launches, such as a second launch site on the West Coast or secure facilities to handle classified information. There's no funding in this procurement round for research and development.
It all sounds complicated, but the upshot is that the military wants to balance its desire for more launch providers and increased competition with its need to ensure payloads have a reliable ride into orbit. This is important because the companies that win lucrative military launch contracts can count on a steady flow of business for years, and companies that lost these competitions in the past have modified, curtailed, or entirely abandoned their rocket programs.
What led to this?
In the past, the Pentagon's procurement offices have hesitated to add a third launch provider for the military's most crucial space missions, saying it would add cost and risk.
Blue Origin, founded by billionaire Jeff Bezos, pushed to have the military select three providers for national security launch contracts during the Pentagon’s previous rocket procurement round, known as “National Security Space Launch Phase 2.”
A big part of Blue Origin's effort to influence the way the Space Force buys launch services has been to lobby lawmakers. In June, the Senate Armed Services Committee advanced a bill that would, among other things, require the military to add a third launch provider for Lane 2 missions. The Space Force is now doing that, but some experts still have concerns about this approach, particularly with regard to Blue Origin, which has delayed the debut of its New Glenn rocket for years.
"So many delays can be easily construed as a lack of reliability and lack of competitive performance, and these two metrics may lead to delays which in turn may lead to increased risks for US national security," wrote Erik Seedhouse, an associate professor of spaceflight operations at Embry-Riddle Aeronautical University.
"It is one thing to give nascent companies like Blue Origin an on-ramp of sorts into the industry by giving them greater leeway over standard missions, as the Space Force has (previously) suggested," Seedhouse wrote in an opinion article published by Space News. "It is quite another to risk the security of this nation’s high-risk missions."
Despite Blue Origin's protests a few years ago, the Pentagon went with two launch providers—ULA and SpaceX—in the Phase 2 launch competition in 2020. At that time, the military picked ULA, a 50-50 joint venture between Boeing and Lockheed Martin, to get about 60 percent of the national security launch orders over a five-year period through 2024. SpaceX was selected to get the remaining 40 percent.
There are a few things you should know here. ULA bid its new Vulcan rocket in the military’s “Phase 2” launch competition. The Vulcan is the replacement for ULA’s Atlas V and Delta IV rockets that the company is phasing out because they were not competitive with SpaceX.
When ULA won its Phase 2 contract in 2020, the Vulcan rocket was scheduled to make its first launch in 2021. Nearly three years later, the Vulcan rocket still hasn’t flown, and it won’t until late this year at the earliest.
SpaceX proposed its Falcon 9 and Falcon Heavy rocket family in the Phase 2 competition.
Another issue looming over the military’s launch procurement division in the late 2010s was the desire to stop launching national security satellites using Russian rocket engines. ULA’s Atlas V rocket, which has delivered the lion’s share of the military’s satellites to orbit over the last 20 years, is powered by Russian-made RD-180 engines. ULA’s new Vulcan rocket has US-built engines, and SpaceX builds its own engines for its rocket fleet.
All of this talk about how the Pentagon buys launch services follows years of ULA's monopoly on these types of launches. ULA was formed in 2006 by the merger of the rocket divisions of Boeing and Lockheed Martin at a time when the military's launch demand was deemed insufficient to keep two independent launch providers in business. Russian and European rockets like the Proton and Ariane 5 were beating the Boeing Delta IV and Lockheed Martin Atlas V launch vehicles on the global commercial market.
Then SpaceX entered the picture with its privately developed Falcon 9 rocket and eventually the Falcon Heavy. Elon Musk's company sued the Air Force in 2014 to protest a sole-source contract award to ULA for dozens of rocket launches. In 2015, SpaceX and the Air Force settled the lawsuit, and SpaceX won the right to compete against ULA.
SpaceX's Falcon rockets have now flown more than 200 consecutive successful missions, a record unmatched by any launch vehicle in history. The military has also gotten more accustomed to SpaceX's unique ability to recover and reuse its rockets, and Space Systems Command has cleared its satellites to launch on previously flown Falcon boosters in recent years.
“The government likes competition," Pentecost said. "It gets us better pricing, gets us more innovation. Ten years ago, we didn't think about reuse; now, every system is going to reuse."
Space Systems Command typically likes to award task orders for its satellite launches at least a couple of years ahead of time. So while the Space Force will dole out its last Phase 2 launch orders in mid-2024, ULA and SpaceX likely won’t finish flying those missions until several years later. Likewise, the first round of Phase 3 task orders should be announced around October 2024, but they won’t start launching for at least a couple more years.
Pentecost said Space Systems Command has awarded 27 task orders to date for Phase 2 national security launch missions, with another 21 task orders to be distributed among ULA and SpaceX next year. That’s a total of 48 missions for the Phase 2 procurement round, roughly half of the number projected for Phase 3.
Just one of the Phase 2 missions—a SpaceX Falcon Heavy launch earlier this year—has actually flown.
