Punching Above Its Weight: The Growing Influence of Canada’s Space Industry

From the earliest days of NASA’s Apollo Program to the launch of the International Space Station (ISS), Canada has stood out as a pioneer and trusted U.S. partner in space exploration and defense cooperation.

A vast country boasting the world’s second-largest land area, with a need to connect people in both urban centers and in rural and remote locations, Canada was a natural for staking an early claim in space-based communications. It was the third country to launch a satellite into orbit in 1962, and the first country to have a domestic communications satellite with Anik, launched in 1972.

Since then, Canada has continued to “punch above its weight,” given the size of its population, carving a place as a leader in satcom, space robotics, and Earth Observation (EO). Canadian ingenuity is found on multiple generations of the Canadarm robotic arm as well as sensors on the Apollo Lunar Module, the James Webb Space Telescope, and a number of deep space missions. The country is also a leader in the area of EO satellites.

Several of Canada’s top space industry visionaries credit early decisions made by Canada’s government for its current standing in space.

Mike Greenley, CEO of MDA Space, a Canadian-based space company, notes that his firm’s three business areas – communication satellites, Earth and space observation and space exploration and infrastructure – are linked to strategic decisions that Canada made decades ago.

“[Our] 45 years of experience in space robotics and operations has put us in a legitimate world leader position,” he says.

Stephen Hampton, head of Government Affairs and Public Policy for Canadian satellite operator Telesat, agrees. “The launch of the first satellite, Alouette 1, conveyed a message to the world that Canada was stepping up to play in this field. We’re a big country with the biggest footprint in the Arctic, and we’re looking to work with our allies to offer up Canadian solutions to global problems.”

And the country is further investing in its space capabilities. Canada has earmarked billions of dollars in recent years to bolster its space leadership by investing in lunar exploration, EO, and enhanced space-based surveillance and communications capabilities. The government has allocated over $1 billion Canadian dollars ($730 million) to expand the country’s RADARSAT Constellation Mission, a trio of satellites used for maritime surveillance, disaster management, and ecosystem monitoring to better understand the impact of climate change, and to begin to design the next-generation EO system.

Those numbers are only part of the story. A 2024 Deloitte report on Canada’s space industry predicts its share of the global space economy could be worth CA$40 billion ($29 billion) by 2040. According to the report, Canada’s space economy represents about 1 percent of the global space economy, while Canada overall represents approximately 2 percent of the global GDP.

If Canada can grow the share of its space economy to match its overall economic contributions, the space sector can hit the “40 by 40” goal of CA$40 billion by 2040, explains Brian Gallant, CEO of Space Canada, a national association representing Canada’s space innovators and ecosystem.

“That’s a modest goal,” says Gallant. He observes that while achieving that market goal will enable Canada to build “a very significant industry in the next decade and a half,” he expects his colleagues will exceed it.

“Canada has the ingenuity, experience, capability, people and innovation to really excel in the space sector. We’ll be able to not only hit that target, but we can surpass it and maybe punch above our weight when it comes to the global space sector,” Gallant says.

The Canadian People Factor

Industry leaders agree continued growth depends on a skilled and motivated workforce, something that they contend Canada has in abundance.

Space employees in Canada number 10,000 today, while another 13,000 workers support space-sector activities. In addition, small and medium-sized enterprises account for more than 90 percent of Canadian space firms and about 30 percent of employment in the space sector, according to data from the Canadian Space Agency (CSA) and cited in the Deloitte report.

The country’s largest space companies also report strong growth. MDA Space is on course to cross the billion-dollar mark in 2025, and has increased its workforce by 50 percent since 2021 to over 3,000 employees today, while providing “hundreds of [supplier] contracts in the country for robotics, EO, and communication satellites,” Greenley says.

That job creation has extended to creating new space companies in the country. “We’re doing these things on purpose to create an even larger space ecosystem,” Greenley says.

Similarly, Telesat has boosted its workforce by nearly 33 percent in Canada this year, as the company ramps up production of Telesat Lightspeed, its next-generation Low-Earth Orbit (LEO) constellation, which is expected to begin launching in mid-2026. The firm now has over 500 employees in Canada with many more planned in the coming years.

Renowned for Robotics

Since the early 80s, the Canadian Space Agency has equipped NASA with multiple generations of the iconic robotic arm, Canadarm: first during the space shuttle era; then during the construction and operation of the International Space Station (ISS); and now for the upcoming Lunar Gateway, the U.S.-led lunar outpost set to orbit the Moon.

Canadarm2, more maneuverable than the earlier generation, executes over 100,000 commands per year and recently celebrated its 50th “cosmic catch” of a free-flying cargo ship to the ISS. The next generation of the technology, Canadarm3, will join the Artemis mission to the Moon.

According to Mike Greenley, CEO of MDA Space, a major component of Canadarm3’s roadmap is to increasingly introduce artificial intelligence into the robotics control systems so the arm can operate more autonomously.

“As we transition from the current space station that orbits 400 kilometers above the Earth to the Gateway, which will be 400,000 kilometers away from Earth, there will be much longer distances for communication with much longer lags in the control cycles. The robotic systems will therefore need to work much more autonomously while still maintaining appropriate safety factors,” he says.

“Canada has huge expertise in robotics and a pedigree in communications dating back to when Telesat used to be government-owned,” says Mina Mitry, CEO of Kepler Communications, a company building an internet constellation in space using the same IP-based networking standards as those used for Earth-based internet connectivity.

He observes that the nation’s advantages in communications and robotics are enabled by “networking businesses that live outside and within the space sector, a continuous, energized pool of talent and high-caliber universities.”

Defense Focus

A growing priority for Canada’s space sector centers on defense. Like the rest of the world, Canada recognizes space’s importance to global security, economic growth and competitiveness. As the United States’ closest geographic ally, Canada collaborates closely with its southern neighbor as both countries look to increase continental defense.

“We are this incredible nation to the north of the U.S., surrounded by three oceans but more and more, we are reliant on space-based surveillance to monitor the approaches to Canada, to understand where those critical infrastructure nodes are and how we can best protect and defend them,” says Brigadier-General Christopher Horner, 3 Canadian Space Division commander.

“Canada has always had a world-class industrial base that includes an ecosystem full of super-innovative firms, and also long standing companies with the technological know-how to deliver world-class talent,” Horner says.

Space-related activities remain vital to the defense of Canada and its sovereignty, even as the adversarial landscape continues to change.

A key priority includes modernizing the infrastructure of the North American Aerospace Defense Command (NORAD), a binational organization that plays a key role coordinating Arctic security between Canada and the U.S. Both countries have embedded their militaries in joint protection of the Arctic.

“NORAD modernization is a huge area where Canada and the U.S. are working in lockstep,” says Telesat’s Hampton, who adds that commercial partners are also a crucial component. Telesat, he observes, has a nearly five-decade legacy serving Canada’s federal government and armed forces.

“There’s a new modern-day space race taking place where governments are working hand in glove with commercial, private sector players in a way that wasn’t seen during the last space race,” Hampton says.

Michele Beck, SVP Canadian Sales for Telesat, sees a heightened sense of urgency to build out infrastructure to protect and ensure Canada’s sovereignty.

“The DND [Canada’s Department of National Defence] is the biggest user on our GEO fleet and they will likely be one of the biggest users in Canada for Telesat Lightspeed, our new LEO constellation,” she says. “The DND is making huge investments in modernizing a lot of their capabilities, working hand in glove with the U.S. Everything they are purchasing today requires connectivity to effectively operate here within Canada and North America or abroad.”

The urgency for more resilient capabilities is reflected in the aggressive posture of adversaries around the globe. Canada’s National Defence officials see more instances of military intelligence gathering under the cover of economic or scientific activities. Russia is bolstering its military presence in its own Arctic region, investing in new bases and infrastructure.

Canadian and U.S. officials concur that Russia is capable of projecting air, naval and missile forces both in and through the broader Arctic region.

Launching New Cyber Command

These threats increasingly extend to the cyber environment, which is why Canada has established a new Canadian Armed Forces (CAF) Cyber Command, similar to the cyber structure the U.S. Department of Defense has embraced.

“Canada now views cyber as a domain of military operations similar to air, land and sea,” says Major General Dave Yarker, newly appointed to lead the Command, established to enhance the military’s readiness to tackle cyber threats. “The rapidly evolving threat landscape and the close, integrated coordination in the cyber domain among the CAF’s key partners and allies necessitates dedicated, agile leadership and an operational focus on delivering effects in joint, integrated operations.”

Yarker notes that the establishment of CAF Cyber Command represents an important milestone for DND/CAF, helping maximize Canada’s effectiveness in cyberspace.

“Echoing similar moves by allies, a dedicated cyber command will reflect the essential role of cyber in modern operations and demonstrate to our allies, partners and adversaries Canada’s commitment to operating in a contested cyber domain,” he says.

Tapping into Faster Commercial Timelines

Canada’s defense community is also mirroring its neighbor to the south by pushing for stronger linkages with commercial firms as it looks to deploy capabilities faster.

Greenley of MDA Space highlights that one notable area where the two allies differ is in how they leverage commercial services in space.

“The United States DoD has a strategy to leverage commercial capability where it exists and not rebuild it inside government. Canada has not adopted that strategy,” says Greenley, who recommends it should be a stronger focus area for the Canadian government.

“Commercial operators have the freedom, the mission orientation and the skillset to go out and deliver on capability that is in high demand by government actors on a timeline and a budget that is otherwise unheard of,” adds Mitry of Kepler Communications.

To encourage greater government-commercial collaboration, the Canadian Space Operations Centre stood up the Canadian Commercial Integration Cell (CIC) in May. Formed as an information-sharing structure for space operations, the CIC communicates timely and relevant information between the Canadian Armed Forces and industry partners.

Currently two companies are part of CIC – MDA Space and Telesat – both large space organizations with existing government contracts.

According to Brig. Gen. Horner, the intent is to bring a broader base of space-based companies to the cell, but the government still needs to overcome challenges within procurement and contracting that keep wider participation difficult. One hurdle is the burden to achieve Top Secret clearance.

“It’s challenging to get to that level as an independent or small to medium-sized entity, unless you’re under contract by the government,” he admits, calling the regular conversations his team is having with a couple of key commercial stakeholders a “small win.”

The creation of new collaboration vehicles is welcomed by both established partners and newer industry players.

“Being able to work together in this CIC and talk about what we and DND are seeing in orbit and coordinate activities in real time with each other only helps maintain situational awareness in space in order to better protect our space assets,” says Greenley.

Mitry notes that commercial firms can move significantly faster than government to deploy new capabilities. “In our experience development is accelerated by at least a year,” he says of commercial speed compared with typical government timelines.

Kepler’s development and testing of optical inter-satellite links between two Pathfinder data relay satellites in LEO this past June illustrate what speed can enable. Mitry says to launch, test and validate the company’s optical technology took seven months. To date, Kepler has deployed 23 spacecraft to provide real-time visibility of assets, whether for EO, radar or weather data.

“We’re ushering in a new era of communications in space using optical links, which historically have been too capital intensive to implement.”

Telesat Lightspeed, Telesat’s planned broadband constellation with global coverage, exemplifies Canada’s commercial space ingenuity. Canada is loaning $1.9 billion for the LEO system that will include 198 spacecraft, providing global, low-latency coverage, even in the Arctic. Compared with Starlink and Kuiper, Telesat may be better positioned to assure lower latency to the edge, while being more cost-effective compared to fiber and microwave alternatives, according to analysis by Data Center Dynamics.

Beck says other governments want to leverage Telesat Lightspeed because of its capabilities, including global coverage.

“You no longer have to design for interoperability based on the theater of operations. The fact that it has ubiquitous coverage means the user terminals will meet their requirements anywhere they’re operating,” she says.

Industry and government leaders agree that Canada has come a long way on its journey as a space leader, and that cross-sector collaboration, including aligning with allies, will be key to the future.

As the Canadian Armed Forces continues to bolster the space domain, it considers collaboration essential, whether with commercial partners, allies or academia.

“The knowledge set and expertise that exists in industry and academia, that’s what makes this a transformational moment for the Canadian space ecosystem as we look towards capability development,” says Horner.

As the country looks to future investment in the space domain, Horner says it’s critical that government leaders embrace an integrated capability development alongside partners, allies and industry. The stakes are high and extend beyond nationalism, he adds.

“Our ability to operate….and to defend Canadians and Canadian values abroad relies on space.” VS

Sidebar: New Earth Observation Strategy Stresses New Players, Climate Focus

In January 2022, Canada announced the Resourceful, Resilient, Ready: Canada's Strategy for Satellite Earth Observation, developed in partnership by the Canadian Space Agency, Environment and Climate Change Canada and Natural Resources Canada.

Its premise: that high-quality EO data is critical for the government to make science-based decisions for Canadians on key issues, including climate change, resource management, infrastructure and disaster response. Engaging new players through new funding vehicles is part of the strategy.

For example, smartEarth promotes innovation and the development of concrete solutions to major challenges through satellite data. It emphasizes flexibility and collaboration between industry, universities and various levels of government.

Several missions under this strategy have received funding, including RADARSAT+, the continuity of the RADARSAT program; WildFireSat, a five-year mission scheduled for launch in 2029 that will enhance Canada’s ability to manage wildfires, which are projected to double by 2050 because of climate change; and High-altitude Aerosols, Water Vapour and Clouds (HAWC), set for 2031, which uses instruments to measure aerosols, clouds and water vapor in the atmosphere to help predict impact Earth’s weather air quality and climate.

Anne Wainscott-Sargent is an award-winning journalist covering space, defense, science & deep tech