FARNBOROUGH, England -- The Boeing Co.’s Defense, Space & Security unit—which comprises about half of Boeing’s revenues— faces increased competition from EADS, the European aerospace giant that is parent of Airbus.

From the US perspective, the high-profile rivalry is between Boeing Commercial Airplanes and Airbus—even in the highly controversial KC-X aerial refueling tanker competition for a $35 billion order from the US Air Force. But EADS has the same ambitions in defense as Boeing’s Defense unit (BDS).

BDS identifies Unmanned Aerial Vehicles (UAVs), cyber security, homeland security in the US and for other countries as key growth areas. Boeing, EADS and other defense companies are competing for shrinking defense dollars in Europe and America and expanding budgets in emerging markets.

Boeing’s Insitu UAV subsidiary is headquartered in Bingen (WA), on the Columbia River.

Stefan Zoller, CEO of the EADS Defence & Security subsidiary, oversees Military Air Systems, Defence Electronics, Defence and Communications Systems and Missiles business units. UAVs are a major push for Boeing, with a goal of becoming the world’s #1 UAV supplier in five years. Zoller says that EADS plans to be a major player in a market now dominated by Northrop Grumman and California’s Global Atomics, in competition with Boeing.

FARNBOROUGH 2010 Seattle aviation industry consultant Scott Hamilton is attending the Farnborough International Airshow 2010 and filing reports for KIRO 7 and kirotv.com.

Cyber security, another Boeing Defense priority, is also one for EADS. Cyber security is “an exploding market,” says EADS CEO Louis Gallois.

“We are seeing budget cuts and reduction in forces all across Europe,” says Zoller. “We are in the face of uncertainty because they haven’t made up their minds. It’s quite clear that European markets will decline or be stable at best. Therefore we have to do something about it.

“Strategically, we have to go where the money is, and the money is around the globe. India, Brazil and Middle East are increasing budgets. These are huge markets, developing markets. We have to become more global.”

In each of these, EADS competes against Boeing for new business, and EADS is competing in the US for not only the air force tanker but also for US Homeland Security business. EADS is already in the Top 10 contractors for Homeland Security. Boeing has cyber security contracts with Homeland Security, the Defense Department and other US government agencies.

EADS and Boeing are expected to square off next year for a DOD contract for the Armed Reconnaissance Helicopters (ARH), another multi-billion dollar contract.