Home >> June 2014 Edition >> The HPA COorner: Policy + Legislation Encourage Hosted Payloads.. So, What’s The Hold Up??
The HPA COorner: Policy + Legislation Encourage Hosted Payloads.. So, What’s The Hold Up??
By Nicole Robinson, Vice Chair, Hosted Payload Alliance + Corporate Vice President, SES Government Solutions


The time and cost benefits of commercially-hosted government payloads have been touted across the satellite industry for years, from payload and satellite manufacturers, to fleet owner/operators, system integrators, and even launch providers.

In recent years, innovative industry and Government leaders working with the United States Air Force, the European Commission and the Australian Defense Force have provided governments around the world with example hosted payloads that have validated the value of this efficient means of leveraging industry and accessing space.

With experience under our belts, and government doctrine lending support to hosted payloads, the question remains: why aren’t hosted payloads more commonplace? Why in an austere budgetary environment, is the U.S. Government finding it challenging to launch additional cost-saving hosted payload programs?

The U.S. National Space Policy explicitly directed the use of non-traditional options for the acquisition of space goods and services, and cites hosted payloads as one of these non-traditional options. In 2013, the Defense Business Board recommended that the DoD, “Continue hosted payload efforts and their ability to fill special needs in a short time frame.” Within the FY14 National Defense Authorization Act, Congress directed the DoD to craft a Space Acquisition Strategy (Section 913) in which alternative business models are to be considered to access space capability—and specifically listed hosted payloads as one such model.

This column’s Question For HPA members
With such clear, strong encouragement coming from policymakers, Congressional leaders and senior DoD officials, what can be done to further connect the requirements, proposed solutions, acquisition models and budgets to foster an environment in which hosted payloads become an integral part of the various space mission architectures going forward?

“It is incumbent on industry to bring forward fully priced business case analyses showing how the U.S. Government can leverage the highly competitive satellite bus market and significant commercial investments already being made in space infrastructure to procure more affordable, resilient and time-efficient space capabilities that government agencies can depend upon and adapt as mission needs evolve.  By taking advantage of commercial hosting opportunities, U.S. Government can focus its efforts on procuring mission payloads that can be supported by commercial bus capabilities.  This payload-focused acquisition strategy can create stable payload production rates, thereby stabilizing lower-tier suppliers and focusing development resources on maintaining intellectual capital needed for unique government capabilities.”—Dave Anhalt, Vice President + General Manager, Iridium PRIME

“While the government has done much work to foster an environment conducive to commercially hosted payloads, there is still work to be done.  

“Perhaps the greatest single challenge to mainstreaming commercially hosted payloads is the difficulty in establishing them as an integral part of system architectures.  Though there is on-going work within several organizations in the USG, until hosting is viewed as an integral program component, and funded accordingly, hosting will be difficult and intermittent.  The inability of the DoD to pre-commit funds for commercial integration of hosted payloads also remains problematic.  Contained within the discretionary budget, payment for these services is subject to annual approval by Congress  and pre-payment violates USG FAR procurement laws.  As such, the return on investment for the commercial company owning the host asset is far from secure unless the costs are heavily recovered in the first year or two on orbit.   Legislation to allow for changes to these rules may be necessary.  Furthermore, the government acquisition cycle needs to adjust to allow for long-term procurement contracts to fully take advantage of the commercial industry’s inherent cost savings, shorter time cycle to place payloads in orbit, and the disaggregated nature of commercial constellations.”—Skot Butler, Vice President, Satellite Networks & Space Services,
Intelsat General

“We must help the U.S. government to transition from programs of record from the last decade to more resilient, disaggregated systems with smaller hosted payloads, more economical space vehicles, and commercial-like approaches to architecture, while keeping within the DoD budget. In order to accelerate the adoption of hosted payloads, we need to create an environment that enables contractors and government to work together.  The National Space Policy provides the vehicle, but it is hampered by sub-policies and guidelines that inhibit contractors from providing commercial solutions cooperatively with the U.S. Government, because these sub-policies and guidelines create additional risks that a commercial contractor will not take.  By eliminating these impediments, the government will benefit significantly through the use of commercially available services, and DoD budgets can be more efficiently allocated, since the outcome will result in costs savings of hundreds of millions of dollars.”—Jim Simpson, President, Boeing Satellite Systems, International Inc.

“As illustrated by the author, policy, guidance and senior leader support is favorably emerging for new capability approaches, but hosted payloads have yet to be produced in significant quantities to satisfy government requirements. Why? Notably, the US Government has yet to formally specify requirements for disaggregated systems and prove the affordability case. Though virtually all major military space systems designed and developed in the past decade are in production and sustainment phase, the US Government has several mission area analyses of alternatives progressing that will inform their respective next generation systems. These on-going architecture assessments must ultimately determine the right mix of capabilities to satisfy requirements with the context of total system affordability. When fully analyzed with recent study data provided by commercial industry, I believe new mission capability approaches will prove favorable for hybrid constellations comprised of large single mission systems augmented by dispersed payloads on commercial spacecraft.”—Chuck Cynamon, Vice President, Business Development, SSL Federal

“HPA members as a group are reaching out every day to all constituencies  for hosted payloads, especially congressional members and military leaders. We have developed and are delivering consistent messages  so that all audiences hear the same thing. And we deliver those constantly. The challenge is adding more value each time we meet with members of Congress, their staffs and those in the Defense Department. The upgraded HPA website is well on its way to helping further the hosted payloads discussion. We should support it with the right content and leverage it in our campaign as much as possible.”—Tim Frei, Vice President, Communication Systems, Northrop Grumman Aerospace Systems

“Cost and schedule benefits of utilizing hosted payloads alone will not be sufficient to change the current acquisition practices of the US Government.  Current programs of record will need to run their course because often times it can cost more to terminate a program.  However, the continuing decline of the defense budget will force defense planners to consider more cost effective and innovative options to meet the ever increasing demands of warfighters and other end users.  Given the proof being provided by the many pathfinder programs like the Commercially Hosted InfraRed Payload (CHIRP) and the Australian Defense Force (ADF) Ultra High Frequency (UHF) hosted payload, the US Government will recognize the benefits of harvesting the well-established and successful commercial enterprise to help meet their requirements.  Hosted payloads will not work for all requirements but they will provide frequent access, on-time and on-budget, adding resilience to a mission architecture through diversity and redundant capability.”—Rich Pang, Senior Director, Hosted Payloads, SES Government Solutions

About the HPA (http:// http://www.hostedpayloadalliance.org/)

Established in 2011, The Hosted Payload Alliance (HPA) is a satellite industry alliance whose purpose is to increase awareness of the benefits of hosted government payloads on commercial satellites. The HPA seeks to bring together government and industry in an open dialogue to identify and promote the benefits of hosted payloads. The HPA:

• Serves as a bridge between government and private industry to foster open communication between potential users and providers of hosted payload capabilities
• Builds awareness of the benefits to be realized from hosted payloads on commercial satellites
• Provides a forum for discussions, ranging from policy to specific missions, related to acquisition and operation of hosted payloads
• Acts as a source of subject-matter expertise to educate stakeholders in industry and government.