Elon Musk’s SpaceX, Already a Leader in Satellites, Gets Into the Spy Game

The breakthrough came last month, about 600 miles above Earth.

For the first time, the Pentagon’s Space Development Agency used lasers transmitting data at light speed to communicate between military satellites on a secure network, making it easier to track enemy missiles and if necessary shoot them down.

It was a milestone not only for the Pentagon. This was a defining moment for a certain up-and-coming military contractor that had built key parts of this new system: Elon Musk’s SpaceX.

SpaceX over the last year started to move in a big way into the business of building military and spy satellites, an industry that has long been dominated by major contractors like Raytheon and Northrop Grumman as well as smaller players like York Space Systems.

This shift comes as the Pentagon and U.S. spy agencies are preparing to spend billions of dollars to build a series of new constellations of low-earth-orbit satellites, much of it in response to recent moves by China to build its own space-based military systems.

SpaceX is poised to capitalize on that, generating a new wave of questions inside the federal government about the company’s growing dominance as a military space contractor and Mr. Musk’s extensive business operations in China and his relations with foreign government leaders, possibly including President Vladimir V. Putin of Russia.

Mr. Musk is also unpredictable in a sector in which security is often perceived to be synonymous with predictability. He chafes at many of the processes and rules of government, saying they hold back progress, and wants to make his own calls.