MOUNTAIN VIEW, Calif. — The U.S. Space Force is adopting a business model where the government owns satellites but relies on commercial operators to run them, a shift driven by mounting concerns over potential attacks on commercial space assets during conflicts and questions about who bears financial responsibility when satellites become military targets, executives said Oct. 29 at the Milsat Symposium.
The move toward so-called GOCO (government-owned, commercially-operated) arrangements has been shaped by developments such as Russia declaring that Western commercial satellites could be legitimate military targets if they support Ukraine. Such threats have sparked discussions in the Pentagon about how to ensure continuous access to critical satellite services while protecting commercial partners from catastrophic losses.
“What we’re seeing is that the government has been more open to government owned, commercially operated systems,” said Servando Cuellar, director of U.S. government programs at Astranis, a commercial satellite manufacturer and provider of geostationary communications services.
The GOCO model, he said, allows the government to leverage private sector technology and operational expertise while retaining ownership and control over critical infrastructure deemed essential for national security.
Balancing risk
For commercial satellite operators, the GOCO structure offers crucial protection from the financial devastation that could result from having their assets targeted in a conflict.
“When we talk about financial loss of an asset, a multi million dollar asset on orbit, in a purely commercial services model, we, the company, take all the risk,” Cuellar explained. “But in a government owned commercially operated system, you still get to leverage all the benefits of commercial, the operations, the innovation, the speed, the rapid deployment, but ultimately, that asset is owned by the government, and they bear the majority of that risk in a conflict situation.”
The Space Force has already begun implementing this model in several programs. Its MILNET low Earth orbit broadband constellation, for instance, will be government-owned but operated by SpaceX, which will handle operations and network management. This setup relieves private industry of key risks that typically spike during conflict or crisis, including asset loss, market volatility, and indemnification for war-related damages.
Other Space Force programs are embracing GOCO arrangements, including the Maneuverable Geosynchronous Orbit (MGEO) satellite services and the Protected Tactical Satcom – Global (PTS-G) satellite procurement program. These initiatives seek to tap commercial satellites to increase the resilience of U.S. military communications in contested environments, where adversaries might target American space assets with electronic jamming and cyber intrusions.
These programs are designed to support military conflicts where the Pentagon might need to reposition satellites rapidly to provide coverage over specific regions. What the government really needs in a conflict, Cuellar said, is the ability to rapidly deploy assets and “shift those communications assets from one area to the area of interest of the area of conflict.”
Under a GOCO structure, he added, a commercial satellite services provider is able to clearly separate its commercial customers and government customers, “and set up those contractual vehicles so that they have assured access to the system to make sure that they get what they want. And we also can still service all of our commercial customers.”
Industry concerns
Despite the advantages of the GOCO model, executives said, significant challenges remain in the broader relationship between commercial space companies and the military.
The Space Force’s Commercial Augmentation Space Reserve (CASR) program, which follows a model similar to the Civil Reserve Air Fleet in aviation, aims to ensure military access to commercial satellite services during crises or wartime. However, industry remains concerned about indemnification and the risks associated with shifting commercial assets to military use when directed by the government. While the Space Force is planning CASR wargames and pilot contracts, the indemnification and compensation frameworks are still being debated.
Brad Bode, co-founder and chief technology officer of Atlas Space Operations, a commercial provider of ground stations as a service, highlighted cybersecurity as a paramount concern. During a conflict, “the number one risk for us is on the cybersecurity side,” Bode said. “We make ourselves a bit of a target when we serve the U.S. government or even other commercial satellite operators.”
The geographic risks are also weighed. Atlas Space Operations must carefully assess where to deploy ground stations that could become targets for downloading or uplinking data, he said. “Right before the war started, we were looking at antennas in Ukraine, and then it started, and we said, well, we just can’t do that, it just doesn’t make economic sense for us.”
The dual-use dilemma
Another persistent challenge involves the government’s approach to procuring and using commercial technology. While defense officials increasingly recognize the value of commercial space products and services, they tend to request customizations that transform dual-use products into bespoke systems, adding costs and complexity.
One of the problems companies run into, Bode said, “is that the government has not yet quite wrapped their head around how to use commercial in certain instances.” Government officials sometimes say they want to use commercial technology but then add specifications that aren’t part of the commercial offering. A company might end up spending millions of dollars to make that happen, “and you don’t even know if there’s money on the other end.”
The dual-use market is expected to expand significantly, with Bode predicting that “Dual use will increase quite a bit in the next 10-20 years,” as investors increasingly demand that companies support government needs. “We were dual use from the beginning,” Bode said. “And I highly recommend in the startup world, that you try to find a way to do commercial and deliver to the government, because your chances of success are much higher.”
Signs of progress
There are indications that the military is beginning to adapt its procurement approach to better align with commercial capabilities, Bode said. Some military program offices are rethinking their approach so they’re not trying to turn dual-use technology into bespoke systems. “I think we’re starting to see some change in procurement that might align better with, Hey, let’s just rethink this whole thing,” Bode said.
Cuellar agreed that industry needs to show how off-the-shelf commercial systems can meet government needs without expensive customization. Astranis, for example, showed it could run a military anti-jam waveform in its software-defined radio without changing the hardware. “So it’s really about using the same thing in a different manner versus trying to design something completely different,” he said.
