Military:
Within Europe, defence spending on military satellites is expected to grow significantly due to spending on secure communications systems, early warning systems, reconnaissance, signal intelligence and navigation. At present, national budgets total approximately €1 billion per year. The US military space budget remains by far the largest worldwide, at approximately US$17 billion, according to official sources. Foreign companies wishing to access this market need to partner a US defence company.

Secure communications is in demand due to increasing deployment of armed forces overseas. Rather than buying equipment, many defence ministries are signing Public Private Partnership (PPP) contracts. Under this model, the service provider builds the satellite and continues to own it, but is paid for the service. This has the advantage of offering better value to defence ministries, and surplus satellite capacity can often be sold by the operator to another user.

Civil institutional and commercial:
Demand for telecommunication satellites is steady, following the downturn in the early part of this decade. The industry expects commercial satellite orders to average 18–20 a year in the near term. Some 19 were ordered in 2005.

Meanwhile, the European Space Agency (ESA) Ministerial Council meeting of 5th–6th December 2005 in Berlin was a success for the industry, confirming the ESA space budget of €8.26 billion from 2006 to 2010 and unanimously adopting a series of favourable resolutions. This provides certainty that current civil institutional programmes will continue.

The Council also made a resolution designed to encourage European countries to favour European launchers for satellite launches, common practice in the United States, China and Russia. Additionally, ministers granted a 2.5% annual increase over five years to the ESA’s science programmes budget.