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For fiscal year 2027, the administration is requesting $71 billion in baseline and reconciliation funding for the Space Force—a 77 percent increase over FY 2026. Based on the initial budget information, about $1.4 billion of the Space Force budget is clearly earmarked for commercial services, with over $1.3 billion of that amount intended for space launch. While the Pentagon has yet to release its most detailed budget information, which will happen in the coming weeks, there is little sign that the Space Force budget meaningfully boosts funding for purchasing non-launch commercial services. This appears counterintuitive given perennial rhetoric from defense and military leaders on the need to integrate and use commercial space services, but reflects a trend whereby the Pentagon asks for little money for non-launch commercial space services, only to have congressional appropriators add funding to such programs. This pattern, reinforced by the high-level budget information released for FY 2027, signals to industry that the Space Force is only marginally interested in commercial services.
That commercial services, other than launch, receive so little attention in the Space Force top-line budget request, particularly given the record-breaking size of that request, is remarkable. This comes at a time when the White House is prioritizing government use of commercial solutions and emphasizing commercial solutions as part of its strategy to maintain space superiority. The Pentagon has also implemented a commercial-first policy. Space Force officials seem on board, echoing similar sentiments with a “buy what they can and build only what they must” approach. The release of two commercial space strategies in April 2024—the department-wide Commercial Space Integration Strategy and the U.S. Space Force Commercial Space Strategy—appeared to formalize a desire by military leaders to figure out how to better use space services. In addition to these two strategies, the Defense Science Board published a commercial space system report in May 2024 that included recommendations for improving the use and integration of commercial space. In 2025, the Space Force established a working capital fund for buying space services, indicated strong demand for satellite communications services, and made progress with the Commercial Augmentation Space Reserve initiative to use and integrate more services. But how is the Space Force funding these initiatives?
The Space Force has never requested a robust budget for non-launch commercial space initiatives, instead relying on Congress to provide extra funds. Consider the case of commercially acquired space situational awareness, also known as space domain awareness (SDA) data and services. In its 2026 budget request, the Space Force requested $34 million for a program used for commercial SDA data buys. For FY 2026, the Space Force received at least around $738 million for SDA activities. In the FY 2027 budget, that amount would rise to an astronomical $1.6 billion. While the Pentagon has yet to release detailed budget information about funding within its high-level budget account, there are no indications to date that commercial SDA data buys and as-a-service procurements will receive a significant funding boost.
Take, for example, the Tactical Surveillance, Reconnaissance, and Tracking (TacSRT) program, which uses commercial satellite data and analytics providers to provide actionable intelligence to the warfighter. In FY 2024, the Pentagon requested no money for the program, but Congress appropriated $40 million for it anyway, as well as $10 million for other commercial services. Once again, in FY 2025, zero dollars were requested for TacSRT; once again, Congress provided funding. Changing tack, the Pentagon requested $36.6 million in FY 2026 for a budget line that funds non-launch commercial services, including TacSRT. Congress appropriated an additional $131.4 million on top of that amount, with $80 million marked for TacSRT. While we do not yet know the specific number for TacSRT in the 2027 budget, the funding line in which this program resides is only budgeted for $23.7 million. This is even less than was requested in 2026 for the same account, signaling, at best, a marginal and waning interest in commercial services.
It should be noted that, in addition to using commercial services for space launch, the military extensively uses commercial satellite communications. The Space Force projects around $1.2 billion in spending on commercial satellite communications annually. However, funding for commercial satellite communications services—essentially, bandwidth on commercial satellites—comes from the other services and not from the Space Force budget. Space Force manages a working capital fund into which the other service branches transfer money to reimburse it for purchases.
Overall, the budget information released so far for FY 2027 shows no indication of greater Space Force spending on commercial space services. Commercial data buys and as-a-service procurements may be included in other program element budget lines—ones that are not solely designated for commercial solutions. This would actually be an ideal outcome, as it would indicate that commercial services are being integrated and used alongside more traditional government-owned and -operated capabilities. While there are cases where this is indeed happening, such as for weather systems, this is likely an exception and not the norm. It is also possible that there is more commercial spending contained in the classified budget line. While there is no way to publicly know, if the past is any guide, there is little reason to expect greater funds in the classified budget for commercial services—the administration reportedly planned to make cuts in the FY 2026 budget to National Reconnaissance Office initiatives aimed at buying commercial space data.
Why does the Space Force budget so little for commercial services? It is easy to point the finger at traditional defense prime contractors and blame them for perpetuating the status quo. But the main issue comes from the government and a deep-seated reticence to use commercial services for critical space functions, which can be mistaken for either inherently governmental functions or activities closely related to inherently governmental functions. Somewhat paradoxically, the Pentagon already relies entirely on commercial services for space access—it is almost entirely dependent on just one company, SpaceX, to get it into space. And the other service branches, with a history going back to the first Gulf War, have heavily used commercial satellite communications services for their missions. But there are no indications that this outcome—use of commercial services for launch and communications, but nothing else at scale—is the result of intentional deliberation or a comprehensive calculation, assessing factors such as cost, performance, and schedule. Rather, it is the result of recurrent barriers to the adoption of new ideas across many organizations: an attachment to the status quo.
It is time to break that attachment to the way things have been done and look at how things could be done better. Budgeting more money for commercial services—sending a real demand signal to industry—creates beneficial flywheel effects, bringing cutting-edge space capabilities to the warfighter today and shaping future commercial developments to meet the military needs of tomorrow. A continuous cycle of congressional funding additions does not accomplish the same effect because it shows that commercial services are not built into the planning processes of the Space Force. Non-launch commercial space services are merely extras that are not integrated into the broader force structure. Planning and budgeting for commercial space services allows the warfighter to use cutting-edge space capabilities today and allows the Pentagon to shape future developments of commercial services to suit military requirements.
For functions and missions like SDA, TacSRT, space-based environmental monitoring, positioning, navigation, and timing, and space servicing, mobility, and logistics—all areas the Space Force has said it wants to explore buying as commercial services—the military is fortunate to have a cornucopia of U.S. companies, funded by private investment in many cases, interested and willing to develop services to meet the warfighter’s needs. But unless the Space Force starts budgeting for these areas, these companies may exit the market because their business models are built around selling services to the military. With the paltry sums to date, even with congressional additions, they are on starvation diets. If the Space Force is truly interested in integrating and using more commercial services, it should act before that happens. It should recognize that it may be the only customer for certain services—and that this is acceptable. It may be too late for the 2027 budget. But there will only be so many more chances before the market deteriorates and investors start to finally realize that the Space Force is not actually interested in budgeting for non-launch commercial services. Let 2027 be the last year of lukewarm interest in commercial space services.
Clayton Swope is the deputy director of the Aerospace Security Project and a senior fellow in the Defense and Security Department at the Center for Strategic and International Studies in Washington, D.C.
