Revenue has been relatively flat for Ball Aerospace & Technologies Corp.’s core space hardware manufacturing business, but that could change significantly in the next couple of years depending on key U.S. government decisions and the ability of mobile satellite services operator Iridium to secure financing for its next-generation constellation.
Among the government decisions anxiously awaited by the Boulder, Colo.-based company is the way ahead following the cancellation of the joint civil-military National Polar-orbiting Operational Environmental Satellite System (NPOESS). Northrop Grumman still holds the NPOESS prime contract and is angling to retain a share of the work on the separate programs to be pursued by NASA and the U.S. Air Force. Ball provided the satellite platform for a precursor mission dubbed the NPOESS Preparatory Project (NPP) and hopes to do the same at minimum for the NASA-led Joint Polar Satellite System.
Meanwhile, Iridium recently selected Thales Alenia Space of France for a $2.1 billion contract to build 81 Iridium Next satellites, whose final assembly and integration would be performed by Ball at its Boulder facilities. But Iridium, whose financing package is backed by France’s Coface export credit agency, still has some hurdles to clear before construction of the satellites can begin in earnest.
Ball Aerospace’s revenue has doubled in the past five to six years, peaking at nearly $800 million in 2008, according to David Taylor, who says the company’s tactical business, which includes aircraft antennas, has been its fastest-growing of late. Ball Corp. does not break out revenue figures for Ball Aerospace, which also has a cyberspace segment.
Space hardware remains Ball Aerospace’s biggest sector, accounting for 40 to 50 percent of annual revenue, and Taylor is bullish on its prospects for growth in the years ahead.
Taylor spoke recently with the Space News editorial staff in Springfield, Va.
Have you gotten any sense as to whether NASA will procure more NPP platforms for the Joint Polar Satellite System?
We don’t know which way it’s going to go. We certainly are biased, as you certainly can understand. NPP’s been done for years. We started off with three instruments, now we’ll have five; we’re waiting on the last one, the Cross-track Infrared Sounder from ITT. I think it’s an extremely well-run program, I think the customer’s happy, we’re certainly happy, it’s on schedule, on cost and I can’t imagine we wouldn’t go forward with more NPPs. Here’s what I would find disheartening: If we do away with the NPOESS Integrated Program Office, and the Defense Department contingent continues with the Northrop Grumman model and the civil-sector Joint Polar Satellite System continues with the Northrop Grumman model, then what did we do? What did we accomplish?
How likely is that scenario?
I don’t know. For a while, I thought that we were as a country on a very good path to redefine the efficiency and the efficacy of the program. So I hope we don’t backtrack. That’s my personal view.
Does Ball intend to compete directly for the prime contract to build the second Space Based Space Surveillance satellite, or will it be part of a Boeing-led team, as was the case on the first satellite?
Ball was responsible for the Space Based Space Surveillance system space segment. We have a very good relationship with the Boeing Co. and I think we produced a very good product. We would have considered priming had the request for proposals been for a space segment only. Since that is not the case, we are seriously considering teaming with Boeing and expect to make a final determination prior to the release of the final request for proposals.
What might Ball’s role be in the next-generation U.S. national security imagery architecture?
As the [U.S. National Geospatial-Intelligence Agency’s] EnhancedView contract vehicle comes into play for national security imaging, we will participate in that as DigitalGlobe participates. We also have, I would say, developing roles on the other elements of the architecture
Ball was an early investor in DigitalGlobe and built all of its current satellites. Does that bar you from building satellites for DigitalGlobe’s competitor, GeoEye?
No, there are no prohibitions against us bidding on other things. But we have a long, very successful history with DigitalGlobe. It’s gone so well that I’d like not to damage that.
Do you think we are about to see the kind of U.S. export reform that will actually allow companies like Ball to compete in overseas remote-sensing markets?
I think there’s reason to hope that we may be able to compete efficiently offshore. If you look at the desire for coalition partners, if you look at the financial situation, I think it would be in our best interest to be able to participate offshore, and I can hope that the trend lines are such that we will be able to do that. So yes, I’m, again, cautiously optimistic that we can be a global competitive force.
Do you think Orbital Sciences Corp.’s acquisition of the General Dynamics satellite-building business has created a stronger competitor for Ball to contend with?
I do. I think Orbital’s a very good company; it’s a very well managed company. They’re strong, we’re strong. I think that we have a very good track record in that domain. We almost invented that domain, the fixed-price, mid-tier, high-performance space segment stuff, and I think that if Orbital makes the acquisition element stronger, that’s good for the mid-tier aerospace. We need strength there. We’re not afraid of competing.
Orbital is bullish on the potential national security market for those mid-tier-class satellites in the next two years or so. Do you have similarly high hopes of this taking off?
It could happen. I don’t mean to be vague, but yes, there could be developing trends that we can participate in on the classic size of missions that we do.
Ball is providing the visual navigation system for NASA’s Orion crew capsule. Do you expect to retain that work if Orion proceeds only as a space station crew lifeboat, as currently planned?
That’s my understanding.
What other elements of NASA’s marked-for-cancellation Constellation program are you working on?
We’re actually building quite a few of the electronics boxes for the Ares rocket. As you know we went after the Ares avionics ring. Boeing won that, so now we’re building many of the boxes for Boeing that we would have built had we won. Unfortunately, our funding has been dramatically reduced, we’ve ramped down, and we’re working closely with Boeing on how best to support Marshall Space Flight Center.
Outside of Earth science, what are some of the other promising areas for Ball as far as NASA business is concerned?
We’re on nine Discovery mission proposals. Hopefully we’ll win a good portion of those.
On the science side, it ebbs and flows. There’ll be a whole bunch where we’re on a bunch of teams, and there’ll be a cycle where we’re on not as many teams. This just happens to be a good cycle for us so we’re pleased with that.
Ball built the U.S. Navy’s Geosat Follow-On 1 ocean-altimetry satellite for about $85 million. Why is the contract to build the Geosat Follow-On 2 satellite valued at $500 million?
There’s a whole bunch of stuff in the $500 million limit. It has options in there, it has other elements of the program, more than just the one satellite.
It’s a fixed-price contract, by the way. The first one was fixed price and this is fixed price, so we think there’s a market, there’s a need for the country to do, as appropriate, fixed-price contracting for operational systems, and that fits into the Navy domain. That’s why they did that. It fits into the Joint Polar Satellite System follow-on for NPP.
A couple of years ago, operationally responsive space appeared to be the wave of the future at the Pentagon. Does this market segment really have legs?
You would have to tell me what operationally responsive space is and how it’s funded, and then I could get excited about it. We chased that pretty hard, thought we understood that, but it seems to not have legs yet. We’re building the second — it’s called No. 3 — Standard Interface Vehicle right now. The first one’s done and we’ve started the second one. But what’s that about, how does that coordinate within the operational paradigm of operationally responsive space, I don’t have a great answer for that.
The Missile Defense Agency continues to seek funding for an operational constellation of missile tracking satellites. Might Ball be competitive on that program should it materialize?
We follow that and we have very good and applicable capability in that domain. Again, remember what I said in the beginning about having decisions made and why things were somewhat soft. Here again, it would be good if decisions were made that support the path going forward. There have been programs that have come and gone in that domain that you guys are aware of, but we do watch that one very intently. We have concepts for instruments that support that mission. We actually have prototypes.
Would Ball have to invest in new facilities to accommodate the Iridium Next program?
No. We did a major expansion a couple of years ago in terms of our manufacturing, integration and test capabilities. So no, an infrastructure investment’s not required.