Defense and tech companies expand underwater security push as seabed infrastructure risks rise

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Underwater infrastructure security expansion

Highlights

Rising geopolitical concerns over seabed connectivity cables and energy pipelines are accelerating government and corporate investment in subsea defense technologies and infrastructure protection.
Euroatlas is developing the GrayShark autonomous underwater vehicle, aiming for up to 16 weeks underwater endurance or 8,000 nautical miles with a hydrogen fuel-cell version.
Major defense firms, including those in Europe and the U.S., are targeting the underwater drone market as Russia and China ramp up subsea capabilities, supported by global growth in drone-related capital.

Investment shifts toward subsea defense technology

As reported by CNBC, concern over the vulnerability of seabed assets is driving countries and companies to assess how critical underwater infrastructure can be protected as hybrid warfare risks expand.

Connectivity cables and energy pipelines on the ocean floor are drawing increased attention as governments weigh the implications of sabotage, cyber pressure and other forms of disruption. Katja Bego, senior research fellow at Chatham House, says the changing threat environment is bringing the issue to the forefront, while defense companies seek a role in a market forming below the ocean surface.

The spread of aerial drones in the war between Ukraine and Russia is also shaping strategy, highlighting how remotely operated autonomous systems can alter warfare. Bego describes the maritime environment as the next logical domain, prompting defense groups to position for that transition.

Autonomous systems and endurance become key market themes

Underwater drones are emerging as a central focus for industry investment. Germany-based Euroatlas is developing an autonomous underwater vehicle, GrayShark, designed to travel to an assigned area and complete missions without continuous human control.

According to Euroatlas executive Alexandru Codrean, constant coverage of the entire ocean is not realistic, making targeted visibility in strategically important areas more valuable. The company is also developing a hydrogen fuel-cell version of GrayShark intended to remain underwater for up to 16 weeks or travel 8,000 nautical miles.

Debate is also forming around what will define the sector's next phase. While Fincantieri Chief Executive Pierroberto Folgiero says underwater telecommunications is the real enabler of the emerging subsea domain, Codrean argues that advances in acoustic and other subsea communications mean range and endurance are now the larger constraint.

The commercial opportunity is attracting companies on both sides of the Atlantic, while Bego says Russia and China are also investing heavily in underwater capabilities. She adds that the broader boom in drone spending is increasing the amount of capital available for this segment of the defense market.

Our earlier article on U.S. startup fundraising and key tech investment themes described how venture capital remains heavily concentrated in AI infrastructure and adjacent computing markets, even as overall weekly funding totals eased. It also highlighted that capital is increasingly flowing toward connected megatrends—such as AI, cloud, cybersecurity, and drones—that can create spillover opportunities for industries linked to connectivity and defense.

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