Satellite services contracts will trim costs for defense buyers

The Defense Information Systems Agency and General Services Administration are on track to finalize a series of contracts for satellite communications later this year. A pair of awards set for the fourth quarter will complete the Future Commercial Satellite Communications Services Acquisition, commonly known as FCSA.

The pending awards are the last of four solicitations, augmenting Schedule 70 awards that were given to a number of companies earlier this year. All told, the four awards will run for a full decade at a cost of about $5 billion.

The contracts are part of a major shift in the way the government buys commercial satellite services used by all government entities, including the Defense Department, in addition to state and local governments. The overarching goals are to improve capabilities and reduce costs.

DISA and GSA, which partnered to manage the acquisitions during 2009, are now evaluating proposals for two multiple-award, indefinite-delivery, indefinite-quantity (IDIQ) solicitations, which will provide end-to-end satellite communications solutions.

“They are still set for the fourth quarter of this fiscal year,” said Jim Russo, FCSA program manager at GSA's Federal Acquisition Service.

The approach lets customers define the requirements while letting contractors engineer custom solutions that include standards, components and interfaces. The IDIQ vehicles will be awarded in two tiers: a Custom SATCOM Solutions (CS2) award and a set aside for smaller companies, called Custom SATCOM Solutions — Small Business (CS2 Small Business). Each IDIQ contract awarded will be for three base years with two one-year options, for a total of five years.

Bidders and users alike are wondering how many contracts will be doled out. “The real question is how many awards will be too many and make it unwieldy,” said Skot Butler, director of strategic initiatives at Intelsat General. Russo declined to provide a specific number, but he noted that the two agencies have enough experience to avoid that potential problem.

Once the contracts are handed out, the winners are expected to set up their networks quickly so government buyers can begin buying satellite time.

“We anticipate that as we go to CS2 and CS2 Small Business, things will move quickly,” Russo said. “The companies with end-to-end solutions can work on transition plans and have them ready when CS2 and CS2 Small Business go out.”

Another concern is whether government agencies will buy all their communications capabilities from the FCSA award winners. During the height of the war in Iraq, many military groups sidestepped DISA and set up their own deals with satellite communication providers.

At that time, demand was high, and capabilities were more limited. Military planners who were often establishing new projects and programs often found it slow and cumbersome to go through established channels. More satellites and bandwidth have become available since then, and the drawdown has reduced requirements while agencies have improved their capabilities.

“DISA has worked hard to bring people into the fold, improving their customer service so people would come in,” Butler said.

At present, DISA and GSA don’t see that as an issue that requires a lot of regulations. “Schedule 70 is something of a self-service operation,” Russo said. “If an arm of the DOD feels they have a compelling need to go through the DISA system, we have no policy control. We do share requests for quotes and proposals with DISA so they know if we’ve been contacted.”