Tactical Communication Market Analysis | 2022-2028

Market Insights

The Tactical Communication Market was estimated at US$ 9.3 billion in 2021 and is expected to grow at a CAGR of 15.1% during 2022-2028 to reach US$ ~21.1 billion in 2028.

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What is tactical communication?

Tactical communication refers to the exchange of information, instructions, and intelligence within a military or emergency response context to achieve specific objectives efficiently. It involves concise and rapid transmission of data between units, often in dynamic and high-stakes situations. This form of communication focuses on providing real-time updates, coordinating movements, and adapting strategies based on changing circumstances. Effective tactical communication ensures seamless collaboration, enhances situational awareness, and supports decision-making, thereby contributing to the success of missions and operations.

Market Dynamics

The military is being compelled to improve its tactical communication capabilities by the swift transition to asymmetric warfare. The worldwide armed forces are concentrating on expanding the network-based communication capabilities of their military equipment across the land, air, and sea domains to increase combat effectiveness, which is fueling the market's expansion. Additionally, it is predicted that demand for network-centric warfare and satellite-based communication will expand along with investments being made in integrating new battlefield technology during the projection period.

Over the past 20 years, wireless communication technologies have fundamentally altered communication standards. New developments like tactical communications in digital signal processing and compression technology have made it easier to combat the issue of misunderstanding. Enhanced communication methods were developed and put into use to permit effective military communications from one command, person, or position to another on a battlefield, particularly during the conflict.

Any of the following methods can be used for tactical communication: written, oral, visual, and audio. Integrated tactical communication systems support command and control operations by being dependable and secure. The need for secrecy in tactical communication cannot be overstated. The military is improving tactical equipment like tactical scopes in response to the growing trend of asymmetric warfare, which includes acts of mass destruction, terrorism, economic fraud, and cyberattacks. The global armed forces are concentrating on enhancing network-based communication capabilities of tactical communication equipment across the land, air, and sea domains to increase combat effectiveness, driving the tactical communication market forward.

Covid-19 Impact

The COVID-19 epidemic and the ensuing travel bans and lockdowns have hampered the supply chains of different market participants. However, in the second part of the year, players modified their business practices in reaction to the pandemic, which lessened the influence of the pandemic on the market. Despite a decline in the world's GDP, worldwide military spending rose by 2.6 percent in 2020, according to SIPRI. However, due to the epidemic's worldwide economic downturn, defense funding may decline in the foreseeable future. This may hinder market expansion throughout the anticipated term.

Several investments/guidelines in the industry have been directed in recent years, which would boost the overall market. Some of them are:

The tactical communication industry is fragmented with several businesses offering communication solutions on different platforms. It is projected that spending on developing faster, more dependable, and more secure tactical communication systems would aid businesses in growing their market presence. Over time, several regional firms have entered the market due to various nations' emphasis on domestic production. For instance, the "Make in India" programme in India has helped private players in the military industry and enabled businesses like Bharat Electronics Limited (BEL) and Saankhya Labs to design and produce cutting-edge communication systems for the nation's armed forces. Predictably, these changes would assist the businesses in improving their cash flow in the coming years.

Segments Analysis

By Platform Type

The tactical communication market has been divided into airborne, shipborne, land-based, and submerged systems based on the platform. The tactical communication market's underwater tactical communication systems segment is anticipated to see the greatest CAGR growth during the forecasting period.

By Technology Type

Tactical communication systems based on next-generation networks (NGNs) and time-division multiplexing (TDM) have been divided into market segments based on technology. During the projection period, the NGN tactical communication systems sector is anticipated to see the greatest CAGR.

The tactical communication market has been divided into many types based on type, including soldier radio, manpack radio, high-capacity data radio (HCDR), and vehicle intercommunication radio (VIC). According to market size, the vehicle intercommunication radios (VIC) category now holds a monopoly and is predicted to keep it for the next five years. The manpack radios category, however, is anticipated to see the fastest CAGR growth throughout the projection period.

Regional Analysis

In terms of regions, North America will likely maintain its supremacy in the tactical communication market throughout the forecast period.  The world's largest military spender is the United States. According to SIPRI, the nation's military spending increased by 4.4 percent in 2020 to reach USD 778 billion, making up 39% of all military spending worldwide. Over the next two years, the nation intends to expand its financial support for electronics, sensors, and communications by around 20%. During the forecast period, there is anticipated to be a significant increase in demand for Leader and Manpack radios as a result of the nation's Handheld, Manpack, and Small Form Fit (HMS) program, which aims to purchase a family of software reprogrammable radios for tactical voice and data communications.

The Communications (PTS) program is designed to offer jam-resistant, low-probability-of-interception satellite communications for tactical troops operating in highly contested areas. Contrarily, the Advanced Extremely High Frequency (AEHF) program's successor, the Evolved Strategic Satellite Communications (ESS) program, is designed to serve strategic tasks including nuclear command and control. Similar to the United States, Canada intends to make large investments in purchasing portable communication equipment in the upcoming years. During the forecast period, these modernization programs to improve the capabilities of the local armed forces are anticipated to fuel market expansion in North America.

Concurrently, Asia Pacific is expected to witness the fastest growth in the tactical communication market during the forecast period.  The APAC area has seen an increase in defense spending, with a particular focus on enhancing communications capabilities by acquiring cutting-edge tactical communication equipment. Manufacturers of tactical communication systems now have large market potential.

Key Players

The following are the major players in the tactical communication market:

• BAE Systems PLC.
• Northrop Grumman Corporation
• General Dynamics Corporation
• L-3 Communications Holdings, Inc.
• Ultra Electronics
• Raytheon Company
• Harris Corporation
• Iridium Communications
• Viasat, Inc.
• Curtiss-Wright (Tactical Communications Group LLC)
• Thales Group

The overall competitive landscape has been affected due to these mergers and acquisitions. 

Research Methodology

This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools. More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data. We conducted more than 15 detailed primary interviews with the market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.

Report Features

This report provides market intelligence in the most comprehensive way. The report structure has been kept such that it offers maximum business value. It provides critical insights into the market dynamics and will enable strategic decision-making for the existing market players as well as those willing to enter the market.

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Recent Mergers & Acquisitions

There is stiff competition in the tactical communication market. The growth of the companies is directly dependent on the industry conditions and government support. These companies differentiate their tactical communication based on their quality and penetration in the target and emerging markets. Also, some major mergers and acquisitions in the industry recently have significantly influenced the competitive dynamics. For example:

• In 2021, In a deal for over 138 million USD, the Indian Ministry of Defence (MoD) and Bharat Electronics Limited (BEL) agreed to buy Software Defined Radio Tactical (SDR-Tac).
• In a statement, Codan Limited said that it has agreed to buy all outstanding shares of DTC from a private equity firm. DTC is a U.S.-based corporation. Subject to the usual regulatory requirements for transactions of this kind, the acquisition was completed by April 30, 2021.
• In 2020, Two of Europe's top high-tech military firms, Indra and Thales, joined forces to create and provide the Spanish Armed Forces with a next-generation tactical communications system.
• In September 2020, The US Army Program Executive Office Command, Control, Communications-Tactical (PEO C3T) awarded PacStar a tactical network communications contract for the delivery of its PacStar 400-Series platform for SCOUT (Scalable Class of Unified Terminals) in support of the US Army Integrated Tactical Network (ITN) program.