Subsequent to the report, Under Secretary of Defense (AT&L) Frank Kendall, at the March 18 SIA Leadership Dinner before SATELLITE 2013, announced he is working with the DoD CIO’s office over the next 90 days to develop “specific proposals for the DoD to acquire commercial satellite capacity more economically.”  Earlier in March, during testimony before a Congressional House Armed Services Committee, Ms. Teri Takai (DoD CIO), confirmed that the DoD is going to “look at what’s the best approach,” and that implementation of “a converged satcom gateway architecture” is already under way. Air Force General William Shelton, in remarks at the National Space Symposium last week, said we must find the “sweet spot” between affordability, resiliency and capability when it comes to acquiring comsatcoms for military requirements.

Viewed collectively, these are all encouraging signs that DoD leaders are beginning to validate positions industry has advocated for some time. [Click here to read an industry group memo to the DoD.]  It appears that there is genuine forward progress in evaluating the recommendations from the DBB.  However, we in industry do not yet see a move to actionable policy – a process with which we would most certainly hope to have input.

As we await further communication from the Pentagon, there is a fair bit of nail biting. What would be disastrous, and possibly further disenfranchise commercial satellite operators, would be that poor policy, by which I mean policy that would place more obstructions on the road to better buying, would suddenly emerge from the Pentagon as a done deal without further discussions or input from industry.  In our view, it is essential that commercial operators play a central role in the development of any such policy.

The DoD’s recent track record on collaboration with industry has been mixed and provides little insight into how this policy may evolve.  One example is FCSA, a definite improvement in contract policy from its predecessor DSTS-G, which makes it easier and more affordable for federal agencies to get secure satellite services on an as-needed basis.  FCSA was created constructively through open and transparent dialogue by the DoD with operators, integrators and users fostering competition and cost savings that benefit the military user with real cost savings. In woeful contrast, the DoD’s recent Guidance on Hosted Payloads from the CIO’s office appears to be in conflict with the DoD’s own posted information on the HoPS IDIQ Contract and will hopefully soon be rescinded.

The satellite operator community has long sought the opportunity to participate in and be a part of DoD’s bandwidth solution. We’re ready to roll up our sleeves and get down to helping formulate a policy that will facilitate the implementation of the various recommendations from the DBB report. This will save precious taxpayer dollars during a time of severe fiscal austerity. More importantly, such a collaborative DoD/industry policy would support the warfighter in protecting national security.

Not surprisingly, the most talked-about issue was sequestration and the impact it will (not “might”) have on the U.S. government and military. Virtually everyone we spoke with felt that the fiscal year will be weakened by the inability of government agencies to fund projects they might otherwise have approved by now. That said, on the final day of SATELLITE, Congress finally passed a form of continuing resolution which finally brought some clarity to the funding picture. I am hopeful this resolution will eliminate at least some of the acquisition log jam which comes from complete uncertainty. On the other hand, because it essentially maintained the sequestration cuts, the break-up of the log jam will also result in widespread elimination of current programs and the delay or cancellation of others scheduled to start this year.

The absence of military uniforms in attendance at SATELLITE was also testament to the impact of sequestration; we heard that service members had been told they would have to take a personal day to attend – and that’s if they were local. The DoD and most agencies have banned virtually all travel for industry conferences and consortia. If measured by the attendance by military personnel at SATELLITE 2013, one would have to conclude the Canadian and Australian militaries plan to spend more money on COMSATCOM services than the U.S. Department of Defense.

High throughput satellite (HTS), especially targeting support of 3G/4G networks, were a major topic of discussion, both on the exhibit floor and in many panels we attended.

We noted quite a bit of discussion about how to add on capability to terminals rather than selling brand new ones. Users want to know how much a frequency upgrade package would cost as opposed to having to buy a new terminal with all the new capabilities. It’s hard to argue with a buyer considering all their options in a fiscally constrained environment.

Hands down, the best news from SATELLITE 2013 was Mr. Frank Kendall’s (USD AT&L) announcement at the SIA Leadership Dinner that his office, in cooperation with the DoD CIO, will initiate an effort to change policy in order to establish a “smarter way to buy commercial satellite communications.” Naturally, XTAR welcomes this announcement and looks forward to contributing to Mr. Kendall’s objectives. Maybe in a few years we’ll look back on SATELLITE 2013 as the moment when DoD and the commercial satellite industry really began to capitalize on the outstanding opportunity to fully support the warfighter and achieve the best value for the dollar on behalf of the taxpayer. We certainly hope that to be the case.

All eyes are now fixed on the National Space Symposium (NSS) in Colorado next week. Given the DoD’s travel ban it’s inevitable that the show will be impacted, much as SATELLITE 2013 was. We will watch that “space” with keen interest.

At a time when we are all searching for more cost-effective ways to deliver force-enabling technologies to the warfighter, hosted payloads represent a significant step in the right direction. Industry has been successfully employing them for over a decade – the value proposition is undeniable!

XTAR is uniquely familiar with the hosted payload model. Our fleet is comprised of both a hosted and a host payload, each having demonstrated an excellent track record. XTAR-LANT, at 30 degrees West, is a hosted payload on SpainSat. On XTAR-EUR, at 29 degrees East, we host a specific payload configuration for a long-term customer. Both payloads have operated at 100% of capability since their respective launches in 2005 and 2006.

I attended a meeting with the DoD CIO office staff in February this year. USG representatives explained that the intent of their memo was to generate discussion with industry, not to provide hard-and-fast rules. If this was the goal, the guidance as written misfires severely. Instead, it provides one-size-fits-all guidance on extremely complex areas of spectrum and orbital slots. It does so without recognizing the wide range of financial and operational practicalities for both government and industry partners in the myriad hosted payload scenarios. On balance, the memo as written actually puts more obstacles in the way of a successful Government hosted payload strategy, contrary to the National Space Policy’s urge to explore such arrangements.

The CIO-issued guidance unnecessarily dictates that the Government take positions on issues at the policy level that should clearly, more appropriately and more successfully be dealt with at a contractual level. The guidance doesn’t reflect the possibility of certain terms being applicable and negotiable in one instance, and then being entirely inappropriate in the next. Each hosted payload opportunity is unique; policy should foster and enable insertion of new technologies and new business models, not hinder them!

Finally, if accepted at face value, the CIO’s hosted payload guidance lays down some extremely difficult parameters for a potential commercial satellite operator partner to swallow. Among other things, the satellite operator is expected to permanently cede the right to frequencies at an orbital slot to the U.S. Government and give it the right to launch a replacement satellite into that orbital slot at any time. This unfairly limits the commercial operator’s opportunity for future revenue.

I urge the CIO to withdraw this guidance memo and replace it with a more open and inclusive document that could then pave the way to harnessing the value proposition of hosted payloads. Not doing so in this period of stiff financial constraints would be a huge missed opportunity. The DoD Deputy CIO, Maj. Gen. Wheeler, could signal a revived and genuine desire to engage with industry in a collaborative and constructive manner by encouraging industry dialogue and input on a new guidance memo.

Engagement between DoD and industry in a meaningful and cooperative manner could yield far more appropriate guidance that complies with all national and international regulations, and can still be consistent with National Security interests. I remain optimistic that, working together, industry and DoD can find the right way to structure a productive and collaborative path that delivers the greatest value of hosted payloads to the U.S. Government.

X-band has the same physical properties whether provided by a commercial or a MILSATCOM satellite. Its unique characteristics offer users mission-critical capabilities simply unmatched by other frequencies. (XTAR President and COO Philip Harlow in a recent blog post outlined the unique physical characteristics of X-band compared to the Ku- and Ka-bands.)  Once it is determined that a mission is best served by the X-band frequency, the Government customer has another important choice to make: Commercial X-band or MILSATCOM?

Here are some questions we are frequently asked: Why would a user choose to pay for commercial X-band when he can “get it for free” by using WGS or DSCS?  What is the case for a Government user to stay with a commercial X-band provider such as XTAR for the long haul?  Isn’t commercial X-band just a place holder until users can get their hands on MILSATCOM X-band?

Our response is very clear: the value proposition of commercial X-band is strong both for the short term and, very often, for the long term. Here are some reasons why a user might consider commercial X-band either in place of, or in concert with, MILSATCOM options:

• Non-preemptible space segment: Every MILSATCOM user – short of Mr. Obama – is at risk of being pre-empted or prioritized off mission-critical space segment by a higher priority user. Warfighters whose missions cannot tolerate the prospect of being pre-empted or of not getting space segment when they need it, often turn to commercial X-band. XTAR users are guaranteed service for the term of their lease.

• Operational independence: Responsible users of commercial X-band earn the right to manage their space segment as necessary to meet their mission requirements. They can maintain anonymity by not being forced to disclose operational information such as terminal location. In this respect, they receive a greater freedom from oversight, constraints, and bureaucracy than they might when using MILSATCOM.

• Interoperability with MILSATCOM systems: All terminals that work on WGS and DSCS can be operated on XTAR, and vice versa. Now that most X-band terminals are capable on both polarities (with some range in transition time), interoperability between XTAR capacity and WGS/DSCS is simpler than ever before. Consequently, an investment in X-band equipment will not be wasted when a switch over to MILSATCOM becomes possible.

• Faster certification of new technology: With a certification process that is measured in weeks (vs. years for WGS), XTAR offers users wanting to take advantage of new X-band systems the opportunity to enjoy those benefits without delay. Airborne and other mobile terminals are excellent examples of this. At the same time, XTAR does a substantial amount to support DoD’s process of evaluating and approving new technology to operate on WGS; we are fully engaged with those terminal manufacturers who want to bring new terminals or new features to existing terminals, into the military’s family of certified equipment. These manufacturers test, evaluate and prove their systems through the development phases using XTAR’s satellites.

• Highly responsive customer support: Like other COMSATCOM operators that place top priority on supporting mission requirements, XTAR is capable of confirming availability of service, performing necessary link budgets and bringing the customer onto the satellite in less than 24 hours. Not to mention, XTAR’s very capable staff offers a unique level of objective engineering and design support to maximize efficiency and value.

These are compelling arguments why commercial X-band is an invaluable resource for potential MILSATCOM users, both for long-term and short-term relationships. As a commercial X-band provider, XTAR is well suited to support government users’ critical need for guaranteed service including commercially-developed capabilities of flexibility, autonomy and security that are intended exclusively for the Government. XTAR is proud of the work we do in support of Government and military users. We believe we offer a value proposition which is compelling for a number of critical communications requirements and we constantly strive to provide every possible advantage to our Government customers.

The truth is, we see the bigger picture. And that is, efficient buying by the Government would allow industry to more effectively plan for the needs and requirements coming down the pike. That translates to cost savings for both sides, and a healthier, more predictable (read stable) industry model.

The DoD is spending much more than it should each year procuring access to this critical force enabler for the warfighter. Current commercial bandwidth procurement practices consistently miss out on opportunities for economies of scale. Yet, how can this be when we in industry and government alike know about the ever-tightening financial constraints we face? And, DoD is continuing to buy additional satellites whose concept and design is over a decade old, which won’t even be delivered in full for almost another half decade, and whose cost is 4-5 times higher than procuring a commercial satellite.

Recently, OSD issued a request for recommendations from industry on potential options for better buying. In a collective response with other commercial satellite operators, my company submitted a memo in which we outlined requisite changes:

1. Budget and contract from an established baseline of DoD COMSATCOM needs which can result in a long-term buying strategy.
2. Develop accurate MILSATCOM vs. COMSATCOM cost comparisons.
3. Use IDIQ contracts only to supplement baseline requirements.
4. Build an architecture that fully integrates commercial and military capabilities.
5. Partner with industry to build protected communications infrastructure for space systems.
6. Use hosted payloads.
7. Have a single Government office which handles all commercial and military satellite capabilities.

The commercial operators are all smart, sophisticated and patriotic. Collectively, we have plenty of creative, innovative business models to achieve greater value for the customer – if only the Government would (or in some cases could) take advantage of these approaches.

We have received no official reaction to our response to OSD’s request. I’m hopeful one will come. In general, commercial satellite operators are concerned about the state of relations with DoD. Despite some reasons to be optimistic about improving opportunities to make headway, the fact is, industry’s overtures to the Government have been met with everything from a polite nod to unbridled enthusiasm, but the end result has been hauntingly consistent – pretty much business as usual.

Commercial bandwidth is a necessity to provide full coverage for the warfighter. While many inside the Pentagon now freely admit that commercial is a major contributor to the war effort, now and in the future, buying practices go essentially unchanged. The Future COMSATCOM Services Acquisition (FCSA) contract which replaced DSTS-G is, in many ways, an improvement over its predecessor. But, in the scheme of things, it will achieve only marginal improvements in value. Changes to procurement need to be much bolder. We need something that will really move the needle.

DISA does an admirable job of managing individual mission requirements and it is in the prime position to create significant value for the DoD, yet does not have the ability to do so. Nor does any other organization in the DoD have the centralized role and responsibility for all current commercial bandwidth procurements – full time, long term, occasional use and short term – plus the authority to determine how to invest in bandwidth for the betterment of the warfighter and the treasury. We need to find ways to incentivize decision makers to do things differently. Empowering DISA to perform this function makes sense in my opinion, and will almost certainly make a difference.

Big MILSATCOM programs have a budgeted line item with a “fixed” dollar amount at the right side of the page, but may not include complete costs for launch, operations and services over the lifetime of the satellites. So it may be difficult for some inside the Government to see how they can save money buying commercial bandwidth. When commercial bandwidth is purchased on the spot market it may seem expensive. That’s because these purchases are, by commercial standards, awfully short periods in duration – which is the most disadvantageous way to buy under the most disadvantageous conditions. Why eat out for lunch every day when brown-bagging it occasionally makes a big difference to your bottom line? You know you are going to get hungry each and every day!

What we need is someone in a position of authority who will no longer accept reduced capabilities for the warfighter and who will no longer accept that we are spending considerably more money than can be justified procuring commercial bandwidth and massive military satellite systems. The military did not get all the smarts this country has to offer – neither did the commercial industry. We need to tackle these issues urgently, and together. It is only by industry and Government working collaboratively that we will find the right answers.

The benefits of commercial X-band are, in many cases, the same or better than those being touted by Ku- vs. Ka- debaters. Hence it is imperative that end users and solutions providers alike do not overlook commercial X-band. Ku-band, and C-band for that matter, is a tried and true standard for good reason – a well-known cost and capability set, various equipment sizes and a supply chain filled with competition. Ka-band will eventually find its niche and become an important and integral part of the available solution set across the world – no doubt growing bandwidth consumption around the world will demand it. 

Choosing the right frequency is a process of matching requirements to capabilities: Who makes the equipment? At what cost and how quickly can I get the equipment? What size antenna do I need? Will I lose signal when it rains? What is the strength of its throughput and will it meet my requirement? How do I manage service across multiple spot beams? Is the coverage available where I need it – and when I need it?

So how does commercial X-band, my bread and butter, stack up? It meets the needs of its users for several technical and operational reasons. Successfully used for military communications for decades, commercial X-band outperforms other frequencies in the most demanding scenarios. Commercial X-band advantages include:

1. Freedom from the clutter of commercial users: This will not prevent intentional jamming altogether, but it does minimize the chances of unintended interference. If remedial actions are required, they are much simpler on X-band than Ku-band.
2. Rain fade resistance: Rain fade is mainly an issue for frequency bands above 10 GHz (X-band operates at 7-8 GHz, so performs much better than Ku- and Ka-bands under adverse weather conditions), and is often better than C-band, which may suffer from adjacent satellite interference.
3. Excellent for mobility applications: Spaced at 4 degrees apart rather than the traditional 2 degree for Ku-band, commercial X-band performs with higher-power and smaller remote antennas (<1m) that mobile applications demand.
4. Maximized throughput: Commercial X-band matches or exceeds all other frequency bands in throughput on the same-sized antennas, and with little impact from rain fade regardless of rain zone.
5. Seamless transition to and from WGS systems: X-band saves cost, time, and training, especially contrasted with Ku-band users who will require new (X-band) equipment to transition to WGS when it becomes available.
6. Existing legacy X-band equipment and experienced users: Limited cost and training required for most military units which often already have the terminals and experience to use X-band.
7. Non-Preemptibility: End users are guaranteed capacity for vital applications such as special operations, training, mobility and Airborne ISR, who are not always able to access government capacity when and as they need it.
8. Operational independence: Responsible government users have the ability to manage the bandwidth they lease with a level of control similar to being an owner of that capacity.

In a world which demands ever more bandwidth at maximum value, selecting the right frequency boils down to carefully assessing the specific requirements of an operation, technology or application. Ku- and C-bands have earned their stripes – yet have their limitations. Ka-band will grow up and spread its wings eventually. At present, however, commercial X-band is one of the most valuable assets in the frequency tool kit. I, for one, will continue to bet on commercial X-band viability in the near future and beyond.

http://www.washingtonpost.com/business/capitalbusiness/commercial-satellite-companies-push-for-pentagon-attention/2013/02/01/f6d96082-6706-11e2-9e1b-07db1d2ccd5b_story.html

Our approach to these changing market dynamics centers on how commercial X-band can most-effectively address current worldwide challenges in the context of the most current technologies available. What are its advantages, and where does it best fit? We believe our approach must remain focused on the end users’ needs and requirements with an emphasis on identifying users or applications which are best-served by X-band. 

Application-Centric Approach

Our new strategy has resulted in a significant increase in our AISR business, an advanced application which is proving to be a significant force-enabler of today’s sophisticated warfighter. As the DoD and other agencies shifted from operatives on the ground to airborne ISR tactics, we evaluated XTAR’s infrastructure to ensure our service remained responsive to those applications. Among the modifications we implemented are repositioning our spot beams, updating our transponder matrix and working with commercial and government teleport operators to offer users more convenient and cost-effective options to access our space segment. As testimony to this new strategy, XTAR realized more than $8M in new AISR business alone in 2012.

Complementing WGS – “Use It Like You Own It”

Commercial X-band offers numerous advantages to potential WGS end users. Viewed from their perspective, commercial X-band complements, rather than competes with, WGS. It should therefore be viewed as a strong alternative asset for warfighters and users who either cannot gain access to WGS bandwidth or where no WGS coverage currently exists. XTAR provides “use-it-like-you-own-it” capacity through two key aspects: Non-Preemptibility and Operational Independence. Our non-preemptible service means that users are not beholden to a priority system that governs who gets access to bandwidth. Additionally, XTAR enables responsible government users the ability to manage the bandwidth they lease with a level of control similar to being an owner of that capacity. Terminals certified for use on WGS are automatically certified for use on XTAR, and the ability to move to and from WGS without having to purchase Ku-band equipment is an attractive financial benefit to using XTAR.

Looking Ahead

XTAR has the potential for rapid growth in 2013 and beyond. XTAR is working closely with its customers, integrator partners, and technology systems developers to address end user or applications needs and requirements. Understanding – and meeting – the needs of the end user is the ultimate goal of strengthening these relationships. Our recent changes in market strategy and embrace of new opportunities demonstrate that XTAR has indeed begun an exciting phase of development. The heritage of our business, commercial X-band communication, remains the heart of what we do: “Delivering X-band to the Power of X”.