The US Department of Defense has selected billionaire Jeff Bezos’ Blue Origin, billionaire Elon Musk’s SpaceX and United Launch Alliance (ULA) of the Boeing – Lockheed Martin joint venture to compete for space missions serving national security.

These private businesses will compete for contracts worth up to $5.6 billion for military satellite launch missions into space over the next decade, according to an announcement made on June 13 (US time).

Increase competition, reduce costs

According to Reuters, the Pentagon did not provide details about the types of rockets it selected from the above companies, but said there were seven businesses participating in the bid with the requirement that the new rockets must be ready to carry out the first missions by December 2024.

SpaceX, ULA and Blue Origin are the first companies selected in phase 3 of the National Space Security Grant (NSSL) program.

Of the three names just announced, billionaire Musk’s SpaceX and Boeing – Lockheed Martin’s ULA joint venture are big names in the rocket launch industry and familiar contractors of the US Department of Defense.

These two “big guys” are suppliers to the Pentagon in phase 2 of NSSL since 2020. Of which, ULA is in charge of about 60% of the launches until 2027, while SpaceX holds the remaining 40%.

The US Space Force (USSF), which is in charge of NSSL, wants to expand opportunities for potential contractors in phase 3 to increase competition, reduce launch costs, promote innovation and improve efficiency for space missions.

The latest announcement puts Blue Origin, owned by billionaire Bezos (founder of e-commerce giant Amazon), into an arena it has long wanted to enter. Previously, Blue Origin failed to win the bid in phase 2.

As part of the Phase 3 contract, Blue Origin will receive $5 million to conduct an initial mission capability assessment. Space X and ULA will each receive $1.5 million as Phase 2 providers.

The race to develop satellites

Mr. Frank Calvelli, a US Air Force official, said that the contracts in phase 3 provide an opportunity to bring the most advanced commercial innovations to the US military’s satellite launch program, according to the Space News website .

Blue Origin is working to bring its New Glenn rocket to market to compete with heavyweights like SpaceX. The New Glenn rocket has been in development for nearly a decade and is expected to make its first launch later this year.

SpaceX’s partially reusable rocket, the Falcon 9, is dominating the commercial space industry in the US with about 207 launches between 2020 and 2023.

At the same time, SpaceX is also testing the Starship heavy-lift rocket, which is designed to be fully reusable. Billionaire Musk believes that Starship will play an important role in sending humans into space and launching a series of satellites into orbit.

Meanwhile, ULA is beginning to phase out its Atlas 5 rocket and shift its focus to the next-generation Vulcan rocket. The Vulcan rocket made its first successful launch in January 2024. It must fly one more mission later this year before it is certified for NSSL missions.

According to CNBC , the USSF is expected to order up to 90 launches in NSSL Phase 3. This phase is divided into two categories: Lane 1 and Lane 2.

Lane 1, announced June 13, focuses on new or specialized rockets designed for less demanding national security missions. More companies are expected to join Lane 1 in the coming years.

Lane 2 is aimed at experienced companies with rockets that meet performance requirements and meet a broader range of national security mission requirements. Lane 2 contracts are expected to be announced in the fall of 2024.