DoD's $25.7M Satellite Telecommunications Contract Awarded to SES Space & Defense, Inc. via BPA Call

Contract Overview

Contract Amount: $25,709,218 ($25.7M)

Contractor: SES Space & Defense, Inc.

Awarding Agency: Department of Defense

Start Date: 2019-08-01

End Date: 2023-09-30

Contract Duration: 1,521 days

Daily Burn Rate: $16.9K/day

Competition Type: NOT COMPETED UNDER SAP

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CSS0082 SERVICES

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $25.7 million to SES SPACE & DEFENSE, INC. for work described as: CSS0082 SERVICES Key points: 1. Contract awarded via a Blanket Purchase Agreement (BPA) Call, suggesting a pre-negotiated framework. 2. The contract's duration of 1521 days (over 4 years) indicates a long-term need for these services. 3. The firm-fixed-price contract type aims to provide cost certainty for the government. 4. No small business set-aside was utilized, and the contractor is not a small business. 5. The contract falls under the Satellite Telecommunications NAICS code, indicating a specific service area. 6. The award was not competed under the Simplified Acquisition Procedures (SAP), implying a potentially larger or more complex procurement.

Value Assessment

Rating: fair

The total value of $25.7 million over approximately four years for satellite telecommunications services requires benchmarking against similar government contracts. Without specific per-unit cost data or comparison to market rates for satellite bandwidth and related services, a definitive value-for-money assessment is challenging. The firm-fixed-price structure provides some cost predictability, but the absence of detailed cost breakdowns or competitive pricing information limits a thorough evaluation of whether the government achieved optimal pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded as a BPA Call, which typically means it was competed or established under a pre-existing agreement with a limited number of vendors. The data indicates it was 'NOT COMPETED UNDER SAP,' suggesting it might have been a sole-source award under a BPA or competed among a select group of pre-qualified vendors. The limited competition could potentially lead to less aggressive pricing compared to a full and open competition.

Taxpayer Impact: Limited competition may result in higher costs for taxpayers as the government may not have benefited from the full range of market pricing and innovation that a broader competition could have fostered.

Public Impact

This contract supports the Department of Defense's critical satellite telecommunications needs, ensuring reliable communication for military operations. The services provided are essential for maintaining command and control, intelligence gathering, and operational readiness. The geographic impact is likely global, given the nature of satellite communications supporting deployed forces. The contract supports a specialized industry sector, potentially impacting a workforce skilled in satellite technology and telecommunications.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about potential overpayment and lack of market-driven pricing.
Lack of transparency regarding the specific services and performance metrics makes it difficult to assess effectiveness.
The long contract duration without clear performance reviews could mask inefficiencies.
Reliance on a single awardee for critical telecommunications infrastructure presents a potential single point of failure risk.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Award to an established company (SES Space & Defense, Inc.) suggests a level of expertise and reliability.
BPA Call mechanism implies a streamlined procurement process for pre-qualified services.
The contract supports essential defense communication infrastructure.

Sector Analysis

The satellite telecommunications sector is a critical component of modern defense and commercial infrastructure, enabling global connectivity. This contract falls within the broader telecommunications industry, specifically focusing on satellite-based solutions. The market is characterized by high barriers to entry due to significant capital investment in satellite technology and ground infrastructure. Comparable spending benchmarks would involve analyzing other government contracts for satellite bandwidth, secure communication services, and related support, which often represent substantial investments due to the specialized nature and global reach of these services.

Small Business Impact

This contract was not awarded as a small business set-aside, and the contractor, SES Space & Defense, Inc., is not a small business. Therefore, there are no direct subcontracting implications for small businesses stemming from this specific award. The absence of a small business set-aside means that opportunities for small businesses to participate in this particular contract are limited unless they are part of a larger subcontracting plan not detailed here.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense and the Defense Information Systems Agency (DISA). As a firm-fixed-price contract awarded via a BPA Call, oversight would focus on ensuring the delivery of contracted services meets the specified requirements and performance standards. Accountability measures would be tied to contractual terms and conditions. Transparency is generally limited for specific contract details unless publicly released through contract databases; however, the existence of the award itself is public. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Information Systems Agency (DISA) Contracts
Satellite Communications Services
Department of Defense Telecommunications Infrastructure
Blanket Purchase Agreements (BPAs)
Firm Fixed Price Contracts

Risk Flags

Limited Competition
Lack of Detailed Performance Metrics
Potential for Cost Overruns if Scope Expands
Reliance on Single Vendor for Critical Service

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.7 million to SES SPACE & DEFENSE, INC.. CSS0082 SERVICES

Who is the contractor on this award?

The obligated recipient is SES SPACE & DEFENSE, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $25.7 million.

What is the period of performance?

Start: 2019-08-01. End: 2023-09-30.

What is the specific nature of the satellite telecommunications services provided under this contract?

The contract falls under the NAICS code 517410 for Satellite Telecommunications. This typically encompasses services such as providing satellite bandwidth, managing satellite transponders, establishing satellite links for voice, data, and video transmission, and potentially related ground segment support. For the Department of Defense, these services are critical for ensuring secure and reliable communication channels for command and control, intelligence dissemination, and operational support across various global theaters. The exact scope would be detailed in the specific Statement of Work (SOW) associated with the BPA Call, outlining the required capacity, coverage areas, service level agreements (SLAs), and any specialized security requirements.

How does the $25.7 million contract value compare to similar satellite telecommunications contracts within the DoD or other federal agencies?

Benchmarking the $25.7 million value requires comparing it against contracts for similar satellite telecommunications services, considering factors like duration, bandwidth capacity, geographic coverage, and security requirements. Contracts for global satellite bandwidth can range from millions to hundreds of millions of dollars annually, depending on the scale and criticality. For instance, large-scale military satellite communication programs or global bandwidth procurements for intelligence agencies often exceed this figure significantly. However, for a specific set of services or a defined operational area, $25.7 million over four years might represent a reasonable investment if it secures essential capabilities. Without detailed service specifications, a precise comparison is difficult, but it appears to be a substantial, though not exceptionally large, investment in this specialized sector.

What are the potential risks associated with awarding this contract via a BPA Call and not through full and open competition?

Awarding via a BPA Call, especially if it was not fully competed under the BPA itself, carries several potential risks. Firstly, it may limit price discovery, as the government might not achieve the most competitive pricing available in the broader market. Secondly, it could stifle innovation from companies not part of the original BPA or those not solicited for this specific call. Thirdly, there's a risk of vendor lock-in if the chosen vendor's technology or services become deeply integrated into DoD operations, making future transitions costly. Finally, the lack of broad competition can sometimes lead to complacency in service delivery or pricing if the vendor perceives limited threat from competitors.

What is the track record of SES Space & Defense, Inc. in providing similar telecommunications services to the government?

SES Space & Defense, Inc. (formerly SES Government Solutions) has a significant track record of providing satellite communications and related services to U.S. government agencies, including the Department of Defense. They are known for offering a range of solutions, including secure communications, managed network services, and connectivity for remote and austere environments. Their experience often involves supporting critical missions requiring high reliability and performance. Government contract databases and past performance reviews would provide more granular detail on their specific project history, customer satisfaction, and adherence to contractual obligations for similar services.

How does the firm-fixed-price (FFP) contract type mitigate financial risks for the government in this satellite telecommunications contract?

The Firm-Fixed-Price (FFP) contract type is designed to shift the majority of financial risk from the government to the contractor. Under an FFP agreement, the contractor agrees to perform the specified work for a predetermined price, regardless of the actual costs incurred. This provides the government with significant cost certainty, as the total expenditure is known upfront, barring any contract modifications. It incentivizes the contractor to manage its costs efficiently to maximize profit. For services like satellite telecommunications, where operational costs can fluctuate, the FFP structure protects the government from unexpected cost overruns related to the contractor's performance or resource management.

What are the implications of this contract not being a small business set-aside for the small business ecosystem?

The fact that this $25.7 million contract was not set aside for small businesses means that direct opportunities for small businesses to win this prime contract are non-existent. While SES Space & Defense, Inc. might engage small businesses as subcontractors, this is not mandated by the contract's set-aside status. This can limit the direct infusion of federal dollars into the small business sector for this specific procurement. Agencies are often encouraged to meet small business utilization goals through various set-aside programs and by ensuring fair opportunities within larger contracts, but the absence of a set-aside here means this particular contract does not directly contribute to those goals at the prime level.

Industry Classification

NAICS: Information › Satellite Telecommunications › Satellite Telecommunications

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: NOT COMPETED UNDER SAP

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: SES Government Solutions Inc.

Address: 11790 SUNRISE VALLEY DR STE 300, RESTON, VA, 20191

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $25,709,218

Exercised Options: $25,709,218

Current Obligation: $25,709,218

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC101318A0002

IDV Type: BPA

Timeline