GSA-DISA Acquisition Pact May Affect Private Satellite Sector Opportunities

[Satellite News 08-10-09] The U.S. General Services Administration’s (GSA) take-over of the management of $5 billion in commercial satellite service acquisitions for all federal agencies, including the U.S. Department of Defense, may exclude some private sector satellite companies from participating in the government market.
    The GSA, under the terms of an agreement with the U.S. Defense Information Systems Agency (DISA), announced Aug. 6 it will issue 70 delivery-indefinite quantity and end-to-end contracts to purchase satellite bandwidth and other services on behalf of U.S. government customers for the next 10 years. Previously, these responsibilities were split between the two agencies. DISA managed military satellite service acquisitions, and the GSA was responsible for the procurement of those services for non-military government organizations. “Why manage separate contract vehicles that offer essentially the same services when we can combine forces?” Tony Montemarano, DISA’s component acquisition executive, said in an Aug. 6 press call.
    Xtar, a privately financed joint venture between Loral Space & Communications and Spain’s Hisdesat, is one of several commercial satellite communications companies that cater to the government sector that may see some current contracts and future opportunities affected by the GSA move. The company owns and operates the Xtar-Eur satellite and offers additional X-band capacity on Xtar-Lant, a payload on Hisdesat’s SpainSat satellite, covering a geographic region that stretches from Denver east to Singapore, including the entire continents of Africa and South America. Approximately 60 percent of Xtar’s bandwidth is sold through other carriers and systems integrators.
    To operate the service, CapRock Government Solutions (formerly Arrowhead Global Solutions) made investments in X-band teleport infrastructure and satellite capacity, including signing a multi-year, multi-transponder agreement with Xtar for X-band capacity on the Xtar-Eur and Xtar-Lant satellites. CapRock also was awarded two multi-million dollar contracts to provide over 200 megahertz of the Xtar commercial X-band satellite services to two major U.S. government agencies. "We’re also adding training and support as value-added services. This way, we’re not relying on third parties,” said CapRock Government Solutions President Tom Eaton, who discussed his company’s government opportunities in a March interview with Satellite News.
    In the interest of cutting costs for the government, these opportunities may be affected, as the GSA’s consolidation of oversight includes renegotiating and replacing contracts set to expire within the next few years. Bruce Bennett, director of satellite communications for DISA, said the agencies would replace the Defense Information Systems Network Satellite Transmission Services-Global (DSTS-G), Satcom 2 and Inmarsat contracts that expire in 2012. DISA and GSA have spent $350 million and $47 million on these contracts, respectively.
    The consolidation of these duties under GSA is expected to result in bulk bandwidth cost savings between 10 and 15 percent, according to Bruce Bennett, DISA’s director of satellite communications. “This partnership will provide one source for commercial vendors to come to in order to meet government and military demand,” said Bennett, in a press conference.