The U.S. federal government has launched a 10-year, $5 billion program to provide commercial satellite communications services to military and civilian customers.
Bids for the Future Commercial Satellite Communications Services Acquisition (FCSA) are due in 2010, with awards expected in 2011. The U.S. government hopes to attract a wide array of satellite service providers, the latest technology and volume discounts.
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The FCSA program will be open to federal, state and local government agencies to purchase dedicated satellite bandwidth, plug-in subscription based services and end-to-end custom satellite solutions.
"We're creating a common marketplace," says Kevin Gallo, program manager for SATCOM services at the U.S. General Services Administration, which will oversee the FCSA program in conjunction with the Department of Defense. "We expect to see further economies of scale because we'll have a broader set of buyers."
The Defense Information Systems Agency (DISA) said the U.S. government's massive satellite deal will result in speedier acquisitions.
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"Not only will we get a cheaper rate, but we'll be able to utilize emerging commercial services faster," says Bruce Bennett, DISA's director and procurement executive officer for satellite communications, teleports and services. "Right now it takes awhile to get these types of services in. We're looking at speeding that up quite a bit."
Bennett says DISA needs satellite communications to support soldiers in remote locations and to fill in the gaps of its fiber-optic terrestrial networks.
"We put in big, dark fiber for our Global Information Grid-Bandwidth Expansion (GIG-BE) program. But that big, dark fiber doesn't go to the middle of the ocean. It doesn't go to things moving faster than 5 mph, and it doesn't go to places with no terrestrial infrastructure," Bennett says. "GIG-BE is great if you're in a garrison. It's great if you're in a fixed location. It's great if you're in a major city. But if you're in the hills of Afghanistan, GIG-BE doesn't cut it. You need something wireless or something that runs on radio frequency."
Bennett says DISA will continue to rely on satellite communications for locations where it can't get terrestrial broadband service. But increasingly the military is looking to satellite as a backup for terrestrial networks in populated areas.
"Where you only have a limited amount of terrestrial bandwidth, you tend to put satellite in as backup and use it in a standby mode," Bennett says. "If a fiber got cut or something else failed, in minutes you could assume that satellite link and at least continue part of your mission."
The FCSA program will replace several existing procurements including GSA's SATCOM II, DISA's Defense Information Systems Network Satellite Transmissions Services Global (DSTS-G) and Inmarsat mobile satellite service contracts.
"We think it's a great example of government agencies working together to benefit the taxpayers," Gallo says. Not only will the combined program reduce overhead but it also will feature continuous competition among the vendors for task orders, he adds.
One provider planning to bid the FCSA deal is Hughes Network Systems, the largest broadband satellite service provider in the United States. Hughes has a SATCOM II contract, and it has won several large video deals including the Social Security Administration's distance learning network and the Government Education and Training Network.
Combining satellite programs "is a smart thing for government and an opportunity for us," says Tony Bardo, assistant vice president for government solutions at Hughes.
Industry observers say the $5 billion figure for the FCSA program is reasonable.
Fed Sources, a McLean, Va., market research firm, estimates that DISA alone will spend more than $560 million on commercial satcom and satcom gateways in fiscal year 2010.
"The high number is driven mainly by connectivity requirements to war-fighting areas in Southwest Asia and other overseas locations," says Ray Bjorklund, senior vice president of FedSources. "With pending drawdown of forces, this number will eventually decrease."