Washington - Billionaire Elon Musk's firm SpaceX has won long-waited approval from the US Air Force to launch military satellites, opening the way to a lucrative market that has been a virtual monopoly for a Boeing and Lockheed Martin joint venture.
With the certification, California-based SpaceX can now compete against the United Launch Alliance - the giant Boeing-Lockheed joint venture - for defence contracts valued at about $9.5bn over the next five years.
As soon as next month, SpaceX could have a chance to bid for the military's new GPS satellite launches, the air force said in a statement.
"This is a very important milestone for the air force and the Department of Defence," said Air Force Secretary Deborah Lee James.
"SpaceX's emergence as a viable commercial launch provider provides the opportunity to compete launch services for the first time in almost a decade," she said.
The move will reduce the costs of launches and improve the effectiveness of the military's space programmes, James added.
The certification for SpaceX will transform the military launch market, said Loren Thompson of the Lexington Institute, a consulting firm with ties to the defence industry.
"For the last ten years, pretty much everything the air force lofted into orbit went on a launch vehicle made by the Boeing-Lockheed Martin United Launch Alliance," he said.
"Now that monopoly is waning," he said.
The market landscape is also changing after Congress told the United Launch Alliance that it must stop using Russian-made rocket engines within the next few years, he said.
"SpaceX could become the dominant supplier of military launch services, given the rock-bottom prices it charges," he added.
Founded in 2002, SpaceX is controlled by Musk, a billionaire tech entrepreneur who started PayPal and Tesla. The company has grown rapidly to become a leader in commercial space launches and for US space agency NASA.
The Pentagon gave the green light after months of wrangling and a lawsuit filed by Space X, which was eventually settled.
Musk had been sharply critical of the US Air Force, accusing it of dragging its feet and failing to recognize an opportunity to bolster competition and reduce costs.
But Musk issued a positive statement after the decision was announced.
"This is an important step toward bringing competition to National Security Space launch. We thank the Air Force for its confidence in us and look forward to serving it well," he said.
The air force said it spent more than $60m on the review for SpaceX, with 150 staff members examining 125 "certification criteria."
An independent review ordered by the air force found that the military and SpaceX lacked a "common understanding," reflecting a clash of cultures between Musk's entrepreneurial firm and the Pentagon's slower-moving bureaucracy.
SpaceX has made numerous cargo flights to resupply the International Space Station and is preparing for a manned flight.
The company competes with France-based Arianespace, which complains of not having fair access to US government contracts.