Australia has cancelled a multi-billion dollar military satellite project with Lockheed Martin , with a Department of Defence statement on Monday saying the military will instead shift its focus to a multi-orbit system.

"I am sure some companies will seriously consider the business case for dealing with defense as a customer in the future, which I worry will mean our warfighters will miss out on homegrown innovations that can make a difference on the battlefield,

Australia's largest-ever defence space contract aimed to deliver a hardened network of three to five satellites offering high-level cyber and electronic warfare protection.

Australia has canceled a landmark $7 billion military satellite contract with U.S. defense giant Lockheed Martin, pivoting toward a more flexible, multi-orbit satellite communication system. The cancellation was communicated through a statement from the Australian Department of Defence on.

Australia's defence minister said on Tuesday a defence satellite program was scrapped because of the threat of new technology that can "shoot satellites out of the sky", and Canberra instead wants to use a mesh of micro satellites for defence communications.