British companies developing next-gen satellite communications technology are to receive £30 million in fresh government funding, as the UK looks to secure a larger share of a global market worth almost £50 billion.

The investment, the second round of funding from the UK Space Agency’s Connectivity in Low Earth Orbit (C-LEO) programme, is aimed at UK firms working on cutting-edge components and technologies for satellite constellations, vast networks orbiting Earth which are critical to delivering high-speed internet, communications and data services.

With the funding, the C-LEO programme will look to support the UK’s advanced satellite capabilities, securing faster processing and lower latency for British businesses, and stronger guarantees over where UK data is stored and managed, a goal aligning with increasing demand for sovereign control over critical digital infrastructure.

The government said the £30 million cash injection into the sector will help emerging UK space-techs move their technologies from the lab to real out-of-this-world missions, positioning them to win future contracts with major satellite network operators. 

“Space is now the cornerstone of our modern economy,” said Liz Lloyd, UK space minister. “This new funding will support the development of smarter satellites with better hardware, the use of AI to make data delivery faster and improved connections between spacecraft.  

“This is part of the government’s commitment to keeping UK companies at the forefront of satellite communications, delivering economic growth and strengthening our defence and national security.”

According to the government, the UK must move quickly if British companies are to capture a competitive share of a market showing exponential growth. Figures show global satellite communications are currently worth north of £49 billion, with expectations it will reach $113 billion (£834bn) by 2030.

European demand for satellites up to 2033 is forecasted to be worth £40 billion alone, even 2% of which would bring around £800 million in revenues for the UK, plenty of reason for Labour to be looking for an early lead.

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Market intelligence firm The Business Research Company expects this momentum to be fuelled by the development of advanced transponders, AI‑enhanced signal optimisation, rising commercial satcom demand, expanding drone and IoT connectivity, and the rollout of IP‑based ground technologies – the very technologies the UK is determined to be at the heart of.

The government said that boosting national satellite and space communications will underpin essential services ranging from navigation and positioning to broadband internet and weather forecasting, as well as an array of defence and national‑security applications.

“UK companies are developing world-class satellite communications technologies, from advanced antennas to optical links that can transmit data between satellites at the speed of light,” said Dr Paul Bate, UK Space Agency CEO.

“Our first C-LEO funding round is delivering real results, and this second call will help even more businesses take their innovations from prototype to product, ready to be integrated into the constellations of tomorrow.”