Raytheon Co. [RTN] announced that the Navy has exercised first-year options worth some $54.4 million for satellite communications terminals for surface ships, submarines and shore stations. If the service exercises all options for production, installation and commissioning of the terminals over the next four years of the contract, it could be worth a total of more than $414 million, the company said.

The unit – the EHF Satcom Low Data Rate/Medium Data Rate Follow On Terminal – is the successor to an earlier generation terminal that Raytheon provided to the Navy. It consists of a common communications suite fitted with one of four antennas adapted for surface ships, submarines and shore installations.

The new terminal costs about one-third less than the previous generation, Raytheon said. It works with the Milstar, UHF Follow On and Polar orbiting satellites. Further improvements planned for the terminal include super high frequency and/or Ka-band transmission, which will enable it to use the Gapfiller satellite and commercial Ka-band spacecraft, the company added.