USA Military Communication Market Outlook to 2028

USA Military Communication Market Overview

• In 2023, the USA Military Communication Market reached a value of USD 9 billion, driven primarily by the continuous need for advanced communication systems that ensure secure and efficient information exchange during military operations. The increasing adoption of satellite communication (SATCOM), software-defined radios (SDRs), and advanced data link systems are the key drivers contributing to the market's growth. Additionally, the modernization initiatives of the U.S. Department of Defense (DoD) further propel the demand for these technologies.

• Key players in the USA Military Communication Market include prominent defense contractors such as Lockheed Martin, Raytheon Technologies, Northrop Grumman, L3Harris Technologies, and General Dynamics. These companies are at the forefront of providing cutting-edge communication solutions tailored to the specific needs of the military. Their portfolios include advanced communication satellites, secure radios, and network infrastructure, ensuring reliable and secure communications for various military branches.
• In 2024, the U.S. Department of Defense launched the Joint All-Domain Command and Control (JADC2) initiative, a comprehensive effort to create a unified communication network that connects all branches of the military. The initiative aims to integrate land, air, sea, space, and cyber communication systems into a single, seamless network. This ambitious project is part of a broader strategy to enhance the DoD's ability to conduct joint operations effectively.
• Washington D.C., San Diego, and Huntsville are the dominant cities in the USA Military Communication Market. Washington D.C., as the nation's capital, hosts numerous defence contractors and government agencies, making it a central hub for military communication development and procurement. San Diego, with its strong naval presence, focuses on maritime communication systems, while Huntsville, known as "Rocket City," is a key centre for aerospace and defence industries.

USA Military Communication Market Segmentation

• By Communication Type: The USA Military Communication Market is segmented by communication type into Satellite Communication (SATCOM), Radio Communication, and Data Link Communication. In 2023, SATCOM dominated the market due to its ability to provide secure and reliable long-distance communication, which is crucial for military operations across vast and remote areas. The demand for SATCOM is further driven by the increasing need for real-time situational awareness and command-and-control capabilities, particularly in overseas military engagements and joint operations.

• By Application: The market is also segmented by application into Command and Control, Intelligence, Surveillance, and Reconnaissance (ISR), and Training and Simulation. Command and Control held the largest market share in 2023, driven by the need for robust and secure communication systems that facilitate decision-making and operational coordination. The increasing complexity of military operations and the necessity for real-time information sharing among multiple units and allies contribute to the dominance of this segment.

• By Region: The USA Military Communication Market is regionally segmented into North, South, East, and West. The North region, encompassing the Pentagon and major defense contractors, holds the largest market share in 2023. This dominance is attributed to the high concentration of military and defence operations in this region, coupled with substantial government investments in communication infrastructure. The presence of key decision-makers and procurement offices further solidifies the North region's leading position in the market.

USA Military Communication Market Competitive Landscape

• Lockheed Martin: In 2023, Lockheed Martin was awarded a USD 1.5 billion contract by the U.S. Air Force to develop and deploy a new generation of secure communication satellites. These satellites are designed to enhance global military communication capabilities, ensuring secure, reliable, and resilient connections across all military domains. The project emphasizes the importance of space-based communication systems in modern warfare and Lockheed Martin's leading role in this sector.
• Northrop Grumman: In 2024, Northrop Grumman successfully completed the deployment of its advanced communications relay system for the U.S. Navy. The system, which is integrated into unmanned aerial vehicles (UAVs), allows for real-time communication between naval vessels and aircraft, even in contested environments. This development highlights the company's focus on enhancing naval communication networks and its commitment to supporting the U.S. military's operational needs.

Growth Drivers

• Increased Defense Budget Allocations for Communication Systems: The 2024 defense budget request is $849.8 billion, 1% increase from the FY2025 enacted level. The budget includes funding for several military communication programs, such as Defense Enterprise Wide Band SATCOM Systems ($101 million), Assured Positioning, Navigation and Timing ($202 million), COTS Communications Equipment ($407 million) and Installation Information Infrastructure Modernization Program ($243 million). This increase is driven by the need to enhance the resilience and security of military networks in response to evolving global threats.
• Rising Threats from Adversarial Nations The growing sophistication of electronic warfare (EW) capabilities among potential adversaries such as China and Russia has intensified the need for advanced and secure military communication systems. In 2023, the U.S. Army reported increase in incidents of EW attacks on military networks during joint exercises. This trend has accelerated the adoption of next-generation communication technologies that can withstand and counteract these threats, driving market growth.
• Rapid Advancements in Artificial Intelligence (AI) for Communication Systems AI integration into military communication systems has seen rapid advancements, with the U.S. military increasingly adopting AI-driven technologies to enhance decision-making, network security, and real-time data processing. In 2023, the U.S. Air Force implemented AI-based communication networks that reduced data transmission delays by 40%, improving the effectiveness of joint operations. The growing reliance on AI is expected to be a significant driver of market growth as the military seeks to leverage these technologies to maintain a tactical edge.

Challenges

• Cybersecurity Risks and Vulnerabilities Cybersecurity remains a critical challenge for the USA Military Communication Market. These cyber threats pose significant risks to the integrity and confidentiality of military communications, necessitating continuous investment in robust cybersecurity measures. The challenge is further compounded by the rapid evolution of cyberattacks, requiring constant updates and innovations in security protocols.
• Interoperability Issues Among Military Branches The interoperability of communication systems across different military branches remains a significant challenge. Despite ongoing efforts to standardize communication protocols, a 2023 report from the U.S. Department of Defense highlighted persistent issues with integrating systems used by the Army, Navy, and Air Force. These interoperability challenges can hinder joint operations, leading to communication breakdowns during critical missions.

Government Initiatives

• Joint All-Domain Command and Control (JADC2) Initiative: The U.S. Department of Defense's Joint All-Domain Command and Control (JADC2) initiative, launched in 2024, aims to create a unified communication network that connects all branches of the military, including land, air, sea, space, and cyber domains. The Pentagon requested $1.4 billion in JADC2 funding for 2024, which falls under the Office of the Undersecretary of Defense for Research and Engineering.
• The National Defense Authorization Act (NDAA) for 2024: The National Defence Authorization Act (NDAA) for 2024 includes provisions for increasing investments in military communication infrastructure, particularly in satellite communication (SATCOM) and cybersecurity. The act allocates USD 8 billion to upgrade existing communication networks and develop new, more secure systems. This initiative underscores the government's commitment to enhancing the resilience and security of military communications in response to emerging threats from adversarial nations.

USA Military Communication Market Future Outlook

The USA Military Communication Market is projected to experience robust growth through 2028, driven by significant investments in cybersecurity, expansion of space-based communication networks, and the increased adoption of AI-driven systems. These advancements will enhance the security, reliability, and efficiency of military communication, ensuring the U.S. maintains its technological edge in defence operations.

Future Trends

• Growth in Cybersecurity Investments: The USA Military Communication Market will see significant growth driven by increasing investments in cybersecurity. By 2028, the U.S. Department of Defense is expected to allocate over USD 20 billion annually to enhance the cybersecurity of military communication networks. This focus on cybersecurity will be critical in protecting military communications from sophisticated cyberattacks, ensuring the integrity and confidentiality of mission-critical information.
• Expansion of Space-Based Communication Networks: The market will also experience substantial growth due to the expansion of space-based communication networks. By 2028, the U.S. military is projected to deploy a constellation of over 200 low Earth orbit (LEO) satellites, providing global, secure communication coverage. These satellites will play a crucial role in enabling real-time, reliable communication in remote and contested environments, enhancing the U.S. military's operational capabilities across all domains.