The Nine PAE Approach: What the Space Force's Acquisition Overhaul Means for Industry

The Secretary for Space Acquisition and Integration, Thomas Ainsworth, confirmed at the McAleese Defense Programs Conference that all nine of the Space Force’s new Portfolio Acquisition Executives (“PAEs”) are being established. He noted that the service is continuing to refine program alignment within the new structure. Commercial space companies pursuing defense opportunities should closely monitor these developments as they assess positioning and engagement strategies.

From PEOs to PAEs

The PAE structure flows from Secretary of War Pete Hegseth's November 2025 memorandum redesignating the Defense Acquisition System as the Warfighting Acquisition System. In an effort to foster the rapid acquisition and delivery of advanced technology to warfighters, PAEs replace the program executive officer model, and instead manage weapon portfolios with direct budget authority and report without intermediate layers to the Space Service Acquisition Executive.

The Space Force has formally announced six PAE portfolios: (1) Space Access; (2) Space-Based Sensing and Targeting; (3) Infrastructure; (4) Battle Management, Command, Control, Communications, and Space Intelligence; (5) Satellite Communications and Positioning, Navigation, and Timing; and (6) Missile Warning and Tracking. Ainsworth also identified three additional portfolios – Space Control; Electronic, Cyber, and Orbital Warfare; and Integration – that have not yet been formally announced.

Notably, the Integration PAE is expected to serve as the focal point for emerging mission areas. Cislunar operations have already been identified as a near-term priority, with coordination anticipated across agencies, including NASA and the Air Force Research Laboratory.

To CSOs and OTAs

The Hegseth memorandum did more than restructure decisional authority, it also prescribed how those decisions must be executed. Acquisition executives and contracting personnel are directed to default to Commercial Solutions Openings ("CSO") and Other Transaction Authority ("OTA"), treating the traditional (and cumbersome) FAR-based contracting as the exception rather than the rule.

The Space Force has already applied this approach across multiple programs. Officials at the Battle Management, Command, Control, Communications, and Space Intelligence (BMC3I) program office have indicated that CSOs enable continuous engagement with software developers, eliminating the blackout periods required under traditional procurement. Similarly, the Space Development Agency has relied on OTA vehicles, most recently for its Tranche 3 Tracking Layer, to accelerate low Earth orbit constellation delivery.

The Space Enterprise Consortium (“SpEC”), managed by Space Systems Command, serves as a primary OTA vehicle, bridging military buyers with commercial space startups and small businesses through lower barriers and flexible teaming. A common acquisition pattern has emerged: the government uses a CSO to identify and evaluate commercial capabilities, then executes an OTA to support rapid prototyping and, in some cases, follow-on production. Designated a Software Acquisition Pathway, the SWORD digital training environment reflects this approach, progressing from a CSO to an OTA award in short order.

Takeaways

The transition to a PAE-driven structure, coupled with expanded use of CSOs and OTAs, is poised to reshape how commercial space companies engage with the Space Force. For new space companies, this represents an all-systems-go moment.

With rapid acquisition now the priority, early engagement is critical. Companies that participate during the CSO phase may be better positioned for follow-on OTA awards, while accelerated portfolio management reduces procurement cycle times and places a premium on responsiveness. Intellectual property considerations also require attention, as OTA agreements often involve negotiated data rights provisions. Emerging portfolios, including the not-yet-formalized Space Control and Electronic, Cyber, and Orbital Warfare offices, are expected to generate a slew of new requirements, making early relationship-building advantageous.

Overall, these reforms are intended to lower barriers to entry and increase participation by non-traditional contractors. Companies that align with the Space Force’s emphasis on speed, flexibility, and mission-focused capability delivery will be best positioned to capitalize on the evolving acquisition environment.

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