Military Space Quarterly | Air Force Hosted Payload Contracting Vehicle Seen as ‘Game Changer’

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WASHINGTON — As the U.S. Air Force prepares to release a final bid solicitation for a contracting vehicle that will enable it to regularly utilize excess payload capacity aboard commercial satellites, industry officials are praising the much-anticipated effort as a “game changer” for the space business.

A draft request for proposals on the Hosted Payload Solutions contracting vehicle was issued June 6 and revised June 21. Industry officials are expecting a final proposal as soon as the end of July.

“We expect that this contract will open the door to many new U.S. government customers who might otherwise never have considered the hosted payload approach,” said Don Brown, vice president of business development and hosted payload programs at Intelsat General Corp. of Bethesda, Md., the government services division of satellite operator Intelsat. “This contract will be a game-changer for U.S. government hosted payloads. And that’s what has us so excited about it.”

The Air Force’s Space and Missile Systems Center in Los Angeles, which procures U.S. military space systems, plans to award multiple indefinite-delivery, indefinite-quantity contracts to a stable of prequalified companies. These selected companies, expected to be a mix of satellite operators and space hardware manufacturers, would be in position to support the inclusion of dedicated government payloads and capabilities aboard commercial satellites.  

The Air Force could spend as much as a half-billion dollars on the program over a five-year period, said Janet Nickloy, director of strategy and business development at Harris Corp.’s Government Communications business unit and chairwoman of the Hosted Payload Alliance, an industry group that promotes the activity. The service has slowly warmed to the idea of hosted payloads in recent years and has studied several potential hosted payload initiatives following the success of the Commercially Hosted Infrared Payload mission that launched in September 2011.  

Then, an experimental Air Force missile-tracking sensor was installed and launched into orbit aboard the SES-2 satellite owned by fleet operator SES of Luxembourg. The sensor allowed the Air Force to test the potential of wide-field-of-view, staring infrared sensors for a range of surveillance missions.

During a keynote address at the National Space Symposium in April, Gen. William Shelton, commander of Air Force Space Command and the service’s top uniformed officer for space, said the Defense Department must consider hosted payloads as one way to help keep costs down. Dispersing government capabilities among commercial satellites would also improve the resiliency of the Air Force’s space architecture, a key tenet of Shelton’s long-term vision.

But the Air Force has been slower to embrace hosted payloads than many advocates of the concept would like. NASA, they note, has several science missions in the works that will fly as hosted payloads aboard commercial communications satellites.

With the final request for proposals due any day, industry officials sense a tide that has shifted in favor of the concept.

“Everybody can say, in principle, this [idea] makes sense,” Nickloy said. “But the contracting details are hard.”

Air Force and industry officials have been surprised by the complexity involved in making government contracts conform to commercial practices, Brown said. Issues with how to structure the pricing have also been difficult.

“However, [Space and Missile Systems Center] has obviously done a huge amount of work in this contract and it will represent a big step forward in working with industry to do things in a more cost-effective and schedule-sensitive manner,” Brown said.

While the details of the hosted payload contract have been a quagmire, the Air Force is “adamant about making it work,” Nickloy said.