According to UnivDatos, growing military modernization programs, rising demand for secure and encrypted communication, expansion of satellite-based communication systems, integration of AI and machine learning, increasing adoption of fiber-optic networks, rising use of cloud and edge computing, and growing focus on multi-domain operations are the major factors driving the growth of the Military and Aerospace Communication Systems market. As per their “Military and Aerospace Communication Systems Market” report, the global market was valued at USD 42,072.00 million in 2024, growing at a CAGR of about 7.87% during the forecast period from 2025 - 2033 to reach USD million by 2033.

The military and aerospace-based connectivity, AI-powered communication, and hardened cyber-defense networks are all moving in one direction; the defense communication environment is undergoing a significant transformation. The point here is that, with the changes in modern warfare towards the rapid exchange of information and synchronized actions, military forces are currently relying on sophisticated communication systems that have the potential to withstand hostile environments. This change is creating opportunities for new technology vendors, system integrators, and component suppliers with the capability to deliver speed, reliability, and resilience.

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Surge in SATCOM Modernization

The rise in investment in the SATCOM upgrades is driving the market growth. Defense agencies are also upgrading their old satellite terminals with high-throughput, anti-jamming, and low-latency communication systems designed to coordinate real-time air, land, sea, and space operations. The governments are granting long-term agreements to construct the safeguarded tactical SATCOM frameworks, secure Ka/Ku band frameworks, and the next-generation GEO/MEO/LEO schemes. To companies in this sector, it represents an opportunity to provide antennas, modems, encryption equipment, and network management tools to maintain continuous, mission-critical communication.

On June 17, 2025, Airbus Defence & Space selected Thales to supply the safety satcom system of the A400M military transport aircraft programme. The A400M is a military airlifter that combines the ability to fly to long distances, carrying loads too heavy or too large for medium airlifters. Extended connectivity is thus critical for ensuring mission success and operational effectiveness.

On July 3, 2025, Boeing awarded a USD 2.8 billion contract for the Evolved Strategic Satellite Communications (ESS) program, the space-based component of the U.S. nuclear command, control, and communications (NC3) architecture. This contract is to enhance U.S. strategic SATCOM capabilities. The initial contract is for two satellites, with options for two more in the future.

Rise of AI-Enabled Battlefield Communication

Machine learning and AI are revolutionizing defense communication systems through real-time data analysis, autonomous decision-making, and predictive network management. These technologies improve signal processing, bandwidth utilization, and threat detection in complex communication networks. The major military activities rely on automation and rapid situational awareness, resulting in fewer human errors and more efficient missions due to AI-driven systems. Therefore, this shift towards smart, adaptive communication systems is one of the major drivers of market expansion in the military and aerospace markets.

On August 11, 2025, the U.S. Air Force launched a USD 99 million ATA-AI project to advance next-generation target tracking using AI, machine learning, and high-performance computing. Work will involve advanced algorithms involving 3D pixel and point cloud processing, electromagnetic signature analysis, and disaster response applications. Several contracts are expected through 2029, with individual awards ranging from USD 1 million to USD 10 million; white papers are due annually through 2028.

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On March 28, 2024, Thales, Europe’s leading high-tech company in the civil and defence fields, announced the creation of cortAIx, which brings together the company’s AI capabilities in research, sensors, and systems. cortAIx is the AI accelerator that will equip armed forces, aircraft manufacturers, and all critical infrastructure operators with highly secure solutions to provide them with more efficient data analysis and decision support, whilst taking into account specific constraints such as cybersecurity, embeddability, and frugality that are related to critical environments.

Cybersecurity as a Core Defense Priority

The prioritization of cybersecurity is growing as communication networks become increasingly interconnected and more vulnerable. Militaries are strengthening encryption and constructing zero-trust platforms and laying intrusion-resistant layers of communication to safeguard secret intelligence and operational data. The transition is providing an immense market opportunity to cybersecurity vendors of secure gateways, hardened protocols, and secure integration of tactical waveforms. As cyber threats continue to grow at an alarming rate, defense purchasers are prepared to invest in solutions that ensure network integrity in the most determined electronic warfare scenarios.

Demand for Resilient Tactical Communication Networks

The resilient tactical communication networks are driven by fast and robust communication in isolated or unpredictable mission locations. These mobile systems enhance the deployment of networks, ensure flawless interoperability, and maintain consistent connectivity among surface, air, and naval forces. Moreover, the demand for an adaptable battlefield network and operations that are responsive in nature is growing; companies are investing heavily in these nodes to enhance situational awareness and mission agility.

For instance, on September 11, 2025, Nokia and Kongsberg Defence & Aerospace (KONGSBERG) announced the signing of a memorandum of understanding (MoU) to collaborate on enhancing tactical communications solutions for the defence sector. The agreement brings together KONGSBERG’s expertise in military tactical communications and Nokia’s leadership in commercial 4G, 5G, and private wireless technologies to deliver secure, resilient, and high-performance networks for defence organizations and allied nations.

Multi-Domain Operations Spark Demand for Next-Gen Defense Communication Solutions

The military and aerospace communication systems market is booming at a rapid pace due to the modernization of satellites, the introduction of AI, the increased significance of cybersecurity, and the focus on mission-resilient tactical networks. This is a unique situation for the technology providers, integrators, and component manufacturers where demand, innovation, and investment are all on an upward trend. The future of defense modernization over the next decade will focus on companies capable of providing secure, intelligent, and high-performance communication solutions.

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