In July 2025, the U.S. federal government proposed an 84% reduction in funding to the Office of Space Commerce. Some say the move would effectively terminate the agency’s further development of the Traffic Coordination System for Space (TraCSS). The proposed budget may therefore halt government efforts to implement TraCSS, which is a civilian-led platform (as opposed to military-led) for monitoring satellite activity and mitigating the risk of orbital collisions. The system provides basic space situational awareness (SSA) data and space traffic coordination (STC) services to a handful of commercial operators. A preliminary version of the TraCSS system is provided by the U.S. Department of Commerce.
In response to the proposed budget reduction, 450 companies from seven different industry groups signed a July 2025 letter urging Congress to continue funding the program. With approximately 12,000 active satellites in space, the letter argues that the proposed budget cuts may pose an increased risk to ongoing, coordinated satellite operations within the U.S. and deter further innovation from the private sector. One space industry executive with the Commercial SSA Coalition, which represents companies providing SSA services to private operators, stated “The U.S. space industry is very concerned that this move will introduce new risks to our operations and to our businesses.”
The potential termination of TraCSS may have implications for both commercial markets and legal frameworks surrounding SSA. Without a government-operated system, private SSA providers could expand their role in orbital traffic management. There may be new opportunities for such companies in a private satellite traffic management market.
From an intellectual property (IP) perspective, a shift toward privatized SSA may spur increased patent activity around orbital monitoring technologies. Some reports indicate patent filings for space and satellite technologies generally have “surged” recently with the rise of large players and many smaller private companies that are beginning to play more of a significant role in driving satellite innovation. If private SSA services become more dominant, ownership and licensing of these patents could rise as well and enhance commercial influence in this area of the space industry.
For the time being, the budget cut remains just a proposal and will be decided no later than October 1, 2025—when the 2026 Fiscal Year begins. Nonetheless, companies in satellite technologies may benefit from reviewing the scope of their patent portfolios for capitalization on an industry that could provide market opportunities by being more commercially driven.
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