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A combined “national team” has been established by three major satellite manufacturers–the Lockheed Martin Space Systems subsidiary of Lockheed Martin Corp. [LMT], the Hughes Space and Communications subsidiary of Hughes Electronics Corp. [GMH] and TRW Inc.’s [TRW] Space and Defense Group–to build the Defense Department’s next generation of highly secure communications satellites.

The program is the successor to DoD’s Milstar highly secure communications satellite system. The next generation is known as the Advanced Extremely High Frequency (Advanced EHF) system and is expected to be worth about $2.5 billion for five satellites.

Formation of the combined team will speed development and manufacturing of the Advanced EHF system by about 18 months and help bridge a gap in worldwide coverage caused by the loss of the third Milstar satellite last year.

Two other Milstars remain on orbit. Launch of the last of the Milstars is expected in 2002.