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Boeing and Lockheed just got $882 million to keep launching satellites

September 30, 2015, 5:50 PM UTC
In this handout provided by the National Aeronautics and Space Administration (NASA), the United Launch Alliance Atlas V rocket with NASA's Magnetospheric Multiscale (MMS) spacecraft onboard launches from the Air Force Station Space Launch Complex 41 on March 12, 2015 in Cape Canaveral, Florida.
Photograph by NASA/Getty Images

A joint venture between Boeing (BA) and Lockheed Martin (LMT) has won a contract worth $882 million to continue their satellite-launching program for the U.S. Air Force, according to Reuters.

The contract will cover the Delta IV and Atlas V rockets under United Launch Alliance, or ULA, and includes launch capability, mission integration, maintenance, and launch site and range operations, among other things.

This marks an important win for ULA, which had previously been holding a monopoly on military satellite launches since its founding in 2006. The joint venture was initially formed as a way to merge both companies’ government rocket businesses, and at that time, the Federal Trade Commission acknowledged that the move could lead to higher prices and reduced quality.

Since then, ULA has made 99 consecutive launches without any accidents. However, the alliance now faces new competition from an ambitious upstart: SpaceX, which in May was certified by the Air Force to compete for some military and spy satellite launches, making Elon Musk’s company an entrant in the national security payload industry.

In January, SpaceX dropped a lawsuit against the Air Force over an $11 billion, no-compete contract the Air Force had given ULA. In exchange, the Air Force has opened up the market to SpaceX, who can offer lower prices for its Falcon 9 rockets, albeit with a shakier launch record.