Abstract In this paper we describe how commercial open standards for embedded systems could affect the architecture of future satellite data handling systems. Traditionally, satellite data handling systems are based on the principles of a federated architecture, i. e. one function is implemented as one box. Each box has its own housing and power supply. In the paper we describe the transition path from the traditional federated architecture to a centralized but modular architecture based on adapted industrial standards. In the presented approach functional modules like on-board computer, Global Navigation Satellite System receiver, interface boards, etc. are combined in a rack communicating via a standard backplane using standardized communication links. The analysis performed during the Advanced Data Handling Architecture study showed that this approach contributes significantly to mass and power reduction (approx. 20 %) of a typical satellite data handling system. Another major point highlighted in the Advanced Data Handling Architecture study is the simplification of Assembly, Integration and Test activities. All this will help space industry to handle increasing system complexity while keeping costs at an acceptable level.