Industry Hopeful as U.S. Air Force Weighs Commercial Satellite Lease

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WASHINGTON — The U.S. Air Force is contemplating a procurement of commercial satellite capacity covering western Africa in a demonstration that industry officials hope is an indication of the Defense Department’s willingness to break buying habits that they say are outmoded and inefficient.

In a request for information released Sept. 16 on the Federal Business Opportunities website, the Air Force Space and Missile Systems (SMC) Center in Los Angeles said it was interested in leasing multiple transponders for the remainder of a geostationary-orbiting satellite’s life on behalf of U.S. Africa Command.

In the most optimistic of outlooks, the proposed demonstration is a game changer. More cautious assessments describe it as a largely symbolic gesture — at least until a contract is awarded.

The solicitation comes on the heels of a kerfuffle that erupted this year over the U.S. military’s use of leased capacity covering Africa from a commercial satellite whose owners include the Chinese government. U.S. Africa Command requested the bandwidth in 2012 to support its operations and the Defense Information Systems Agency (DISA) entered into the controversial arrangement after no alternative solution materialized. 

While the arrangement, which was well within the rules, riled some members of Congress, Defense Department officials insisted they had no other choice and DISA, which leases commercial capacity on behalf of military users, renewed the one-year contract in May. The contract is with U.S.-based satellite solutions provider Harris CapRock, which leased the capacity in question from APT Satellite Holdings of Hong Kong, a commercial satellite operator that is nearly 40 percent owned by China Aerospace Corp.

Now the Air Force seems to have leveraged the situation into an opportunity to experiment.

SMC, traditionally a buyer of military space hardware, said in its solicitation that it is “contemplating the feasibility of procuring on-orbit transponders to support Ku-band communications for U.S. AFRICOM. The intent is to identify sources to support a small military communications pathfinder while demonstrating risk mitigation steps toward future innovative, affordable procurement of long term Commercial Satellite Communications capabilities.”

The service said it intends to leverage DISA’s existing Future Commercial Satellite Communications Services Acquisition contracting vehicle while demonstrating processes for expedited competitive contract awards. “SMC also intends to include an Operations and Support task to provide multi-year, commercially-controlled, satellite operations and situational awareness services for the procured transponders,” the notice said.

Commercial satellite executives are tracking the request and say it marks the first time the SMC has issued a request for commercial satellite communications services, which typically are procured by DISA.

If the effort is successful, executives said, it could be a model for future procurement of commercial satellites, an enterprise that they have long argued is sorely in need of reform.

 “This is an excellent indication the Air Force is serious about moving the acquisition reform initiative forward in concrete ways,” said Andrew Ruszkowski, vice president of global sales and marketing Xtar LLC of Herndon, Va., which operates X-band satellites and markets the capacity to government customers.

Air Force leaders in recent months have been studying the issue. On Aug. 16, Air Force Space Command released a white paper on the topic, “Impediments and New Approaches for Leveraging Commercial Satellite Communications in Support of the Air Force and Department of Defense,” which pushed for more out-of-the-box solutions to meeting the services commercial satellite needs.

The Sept. 16 solicitation appears to answer to that call. 

Executives were pleased in large part because SMC officials laid out what they described as a reasonable and detailed set of requirements. 

The request is “giving people a chance to propose real ideas,” said David Cavossa, president of Harris CapRock Government Solutions of Fairfax, Va.

The Air Force said it is looking for low-cost capacity aboard satellites in inclined orbits, which typically refers to aging geostationary satellites that, in an effort to save station-keeping fuel, are no longer stabilized on a north-south axis. In the commercial world, capacity aboard these satellites is considered less than optimal and thus is offered at discount prices, which industry officials say is important given Africa Command’s high bandwidth demand.

The request calls for Ku-band coverage and capacity over western Africa and also notes that user terminals will be capable of tracking satellites.

Skot Butler, vice president of sales, marketing and business development for Intelsat General Corp., the government services arm of satellite operator Intelsat, said his company has long advocated for more creativity in the governments budgeting and procurement processes for commercial capacity. “It all begins with defining a role for [commercial satellite communications], then planning and building commercial into the long term space architecture,” he said.  

But industry executives remain cautious, saying the proof lies in whether or how SMC follows up on its request for information. “It is particularly encouraging if the Air Force follows up the [request for information] by making a significant contract award which expands the list of [military commercial satellite communications] acquisition models available,” Ruszkowski said. 

Responses to the solicitation are due Oct. 8.