GAO-04-71R Transformational Satellite Program 

United States General Accounting Office 

Washington, DC 20548 

December 4, 2003 

The Honorable Donald H. Rumsfeld 

The Secretary of Defense 

Subject: Space Acquisitions: Committing Prematurely to the Transformational 

Satellite Program Elevates Risks for Poor Cost, Schedule, and Performance 

Outcomes

Dear Mr. Secretary, 

In a multibillion-dollar effort, the Department of Defense (DOD) plans to build a 

space-based communications system that leverages technologies never before used in 

space. Such a system would enable DOD to transform how information is collected 

on potential U.S. adversaries and how military forces are warned of hostile action. 

The backbone of this system will be the Transformational Satellite (TSAT),1

 which is 

expected to play a pivotal role in connecting communications networks on the 

ground, in the air, on ships, and in space. TSAT represents a potential leap forward in 

communications speed, security, and availability. The Air Force, which heads up 

DOD’s space programs, intends for TSAT to be interoperable with similar systems 

being acquired for the National Aeronautics and Space Administration (NASA) and 

the intelligence agencies. 

The initial TSAT program is expected to cost about $12 billion from 2003 to 2015 for 

development and production. Several billions more are to be spent acquiring and 

supporting the associated ground infrastructure, including thousands of user 

terminals. The Air Force intends to start the acquisition program in December 2003 

and expects to launch the first TSAT in 2011. 

To help pay for TSAT, the Air Force has scaled back its acquisition of the Advanced 

Extremely High Frequency (AEHF) satellites currently under development. However, 

because of senior military commanders’ concerns about TSAT’s risks and the 

potential delay in delivering improved space communications, the Air Force plans to 

reassess the need for future AEHF funding in November 2004. If TSAT is considered 

too high a risk to meet the warfighter’s expectations, the contingency plan is to take 

TSAT’s funding—thereby delaying TSAT’s development—and use it to buy another 

AEHF satellite. The Air Force has targeted November 2004 as the latest date such a 

 

1

 The TSAT program also includes development of another satellite, the Advanced Polar System (APS). 

Because development efforts for TSAT and APS are similar, we are referring to both programs as TSAT 

in this report. More information about APS is included in enclosure I. 
2 GAO-04-71R Transformational Satellite Program 

decision could be made and still include funds for AEHF in the DOD budget 

submission for fiscal year 2006. 

We conducted this assessment in response to the large investment planned and the 

importance of the communications capabilities promised by TSAT and AEHF. 

Specifically, we assessed the Air Force’s readiness to (1) initiate a TSAT acquisition 

program in December 2003 and (2) make a decision in November 2004 about whether 

to take TSAT funding and use it to buy another AEHF satellite. 

RESULTS IN BRIEF 

Air Force officials have set two imminent deadlines: starting the TSAT program in 

December 2003, and deciding whether to shift funding from TSAT to AEHF in 

November 2004. The Air Force is currently not prepared to make an informed 

decision in either case. 

Air Force officials are not ready to initiate the TSAT program in December 2003 

because they do not have the knowledge to reliably establish cost, schedule, and 

performance goals. At program start, program managers are required by law to 

establish such goals.2

 Our past work on successful acquisition programs has found 

that these goals cannot be set reliably unless the critical technologies and design have 

been determined to meet minimum performance requirements. Programs that do not 

have this knowledge at program start have a much greater risk of resorting to costly 

design changes later in the development process, asking the warfighter to 

compromise on desired capabilities, or incurring schedule overruns to correct 

problems. Realizing that TSAT’s schedule is ambitious, the Air Force added 2 years to 

the acquisition program. However, the extra time was mostly allocated to the latter 

part of the development process, not to the front end, when program managers 

typically need the time to become reasonably certain that technologies and early 

designs will work as envisioned. 

We are concerned about the Air Force’s readiness to make the planned decision in 

November 2004 to take TSAT funding to buy another AEHF satellite in case the TSAT 

program falters. Air Force officials have not defined what evaluation criteria they 

intend to use in making this decision. Senior military commanders want assurance 

that they will get at least the level of capabilities promised by AEHF early in the next 

decade. However, senior DOD and Air Force officials told us that if funds were 

shifted from TSAT back to AEHF, then TSAT—the linchpin of its plan to transform 

military communications—would be substantially delayed. To promote well-informed 

and objective investment decisions, our past work has found that decision makers 

establish and use measurable criteria for evaluating the costs, benefits, and risks of 

various alternatives. 

 

2

 10 U.S.C. sections 2220 and 2435. 
 3 GAO-04-71R Transformational Satellite Program 

We are recommending that you direct the Secretary of Air Force to develop critical 

technologies more fully and to conduct early design studies before starting the TSAT 

acquisition program. We are also recommending that you direct the Secretary to 

establish and use measurable evaluation criteria for the planned November 2004 

funding decision. Although DOD agrees to adopt such criteria, it believes the 

acquisition program can be started because sufficient controls are in place to allow 

concurrent development of technology and product design. 

BACKGROUND 

DOD intends to develop a new generation of space communications systems, taking 

advantage of rapidly advancing technologies. This reflects an increasing demand and 

reliance on satellite communications systems to move larger volumes of information 

to more users. The Air Force reports that the demand for communications bandwidth 

increased 473 percent between Operation Desert Storm in 1991 and Operation 

Enduring Freedom in 2001. To help meet this demand, DOD has augmented its own 

satellite communications capability with commercial satellites. However, in each 

major conflict in the past decade, senior military commanders still reported shortfalls 

in communications capacity, particularly for rapid transmission of large digital files, 

such as those created by imagery sensors. DOD’s communications studies indicate 

the shortfall will continue to grow, despite major improvements in communications 

satellites currently in development. 

Investment Strategy for Satellite Communications Revised

In 1996, DOD developed and began to implement a space investment strategy that 

proposed a new mix of improved communication satellites for use in 2010 and 

beyond. Among the proposed systems were the AEHF satellite, the Wideband 

Gapfiller Satellite (WGS), Advanced Polar System (APS), and Advanced Wideband 

Satellite (AWS), a less capable and earlier version of TSAT. At that time, DOD 

believed that AWS, AEHF, and WGS would provide a significant increase in 

communications capacity and would meet the warfighters’ needs in 2010 and beyond. 

(More information about these satellite systems and their associated acquisition 

programs is included in enc. I.) 

In 2001, DOD developed a new Transformational Communications Architecture that 

uses emerging communications technologies. The architecture is expected to 

transform future combat and intelligence operations, with TSAT playing a critical 

role. The concept is to use laser-based and improved radio frequency transmission 

systems and high-speed, Internet-like networks that will link communications 

systems on the ground, in the air, on ships, and in space. Instead of circuit-based 

systems, such as those used today to link specific sending-and-receiving devices, 

future systems are expected to connect multiple sending-and-receiving devices at the 

same time. The ultimate goal is to remove the existing constraints to communication 

and enable transmissions regardless of location, size, or message. 
4 GAO-04-71R Transformational Satellite Program 

Knowledge-based Acquisition Strategy Results in Better Outcomes 

Historically, DOD has had difficulty meeting the cost, schedule, and performance 

goals that were established at the start of its major defense acquisition programs such 

as TSAT. DOD’s investments in money and time have far exceeded initial estimates 

for developing and acquiring communications satellites and other weapon systems. In 

addition, weapon systems have frequently been saddled with performance shortfalls.3

To address some of these difficulties, DOD recently implemented a new space 

systems acquisition policy, which intends to provide decision makers in the Air Force 

with more consistent and robust information on costs, technologies, and 

requirements. The new acquisition policy also promotes rapid introduction of 

emerging technologies into space systems and allows technology, design, and system 

development to occur concurrently in an effort to speed the acquisition process. A 

recent GAO report identified some positive aspects of the policy; however, the report 

stated that any benefits will be limited because the policy permits major investments 

in new programs before managers know what resources are really required to deliver 

a promised capability.4

Our work on best practices in weapon system acquisitions has shown that program 

managers have a much higher probability of meeting cost, schedule, and performance 

objectives if the needed technologies are mature and the developing contractor has 

completed early design studies before starting the acquisition program. Having this 

knowledge in hand means managers can build a strong business case and ensure their 

products can be successfully developed. A business case provides the necessary 

structure for managers to identify the best product solution based on knowledge of 

performance, constraints and assumptions, and a risk-adjusted cost-benefit analysis. 

In the past several years, GAO has developed a knowledge-based acquisition model 

based on best practices by leading companies. The best practices model has three 

knowledge points. Each knowledge point builds on the preceding one. The acquired 

knowledge is used to identify and reduce any risks before moving a product to the 

next stage of development. Figure 1 shows when the three knowledge points occur 

on the best practices model. 

 

3

 U.S. General Accounting Office, Military Space Operations: Common Problems and Their Effects on 

Satellite and Related Acquisitions, GAO-03-825R (Washington, D.C.: June 2, 2003). 4

 U.S. General Accounting Office, Defense Acquisitions: Improvements Needed in Space Systems 

Acquisition Management Policy, GAO-03-1073 (Washington, D.C.: Sept. 15, 2003). 
 5 GAO-04-71R Transformational Satellite Program 

The first knowledge point sets the stage for the eventual outcome of an acquisition 

program—desirable or problematic. When the customer’s needs match the 

developer’s resources (which include technology, design knowledge, time, and 

money) before program start, successful outcomes are much more likely to occur. If 

a match occurs after program start, managers often make additional, unanticipated 

investments in money and time because gaps between requirements and resources 

are discovered later in the process. 

AIR FORCE IS SETTING COST, SCHEDULE, AND PERFORMANCE GOALS 

AND STARTING TSAT BEFORE CRITICAL KNOWLEDGE IS ATTAINED 

By December 2003, when the TSAT program is scheduled to start, Air Force officials 

are required by law to establish cost, schedule, and performance goals, but the 

knowledge they need to set reliable goals is still not available. Critical technologies 

are underdeveloped and early design studies have not been started. Without this 

essential knowledge, the Air Force is likely to have difficulty developing a sound 

business case for starting the TSAT program. If the Air Force proceeds without a 

sound business case, the program is at risk of higher costs, lower performance, and 

delays in providing capabilities to the warfighters. Our work has found that 

successful commercial and DOD development programs insist on having mature 

technologies and early design studies to support the business case.5 

Critical Technologies Are Immature 

Critical technologies are necessary building blocks for a system to meet its minimum 

performance requirements. If these technologies are not available when needed, the 

system cannot be completed as planned. And because technology development does 

 

5

 U.S. General Accounting Office, Best Practices: Better Management of Technology Development Can 

Improve Weapon System Outcomes, GAO/NSIAD-99-162 (Washington, D.C.: July 30, 1999); and U.S. 

General Accounting Office, Best Practices: Better Matching of Needs and Resources Will Lead to 

Better Weapon System Outcomes, GAO-01-288 (Washington, D.C.: Mar. 8, 2001). 
6 GAO-04-71R Transformational Satellite Program 

not happen on a planned or predictable schedule, it is difficult to predict when or if a 

critical technology will mature. This is why leading commercial companies demand 

that critical technologies are mature before the commitment to a new system is 

made. Within the federal government, NASA leveraged this best practice by 

developing an analytical tool to assess technology maturity. This tool—adopted by 

many DOD programs—establishes Technology Readiness Levels (TRL) for 

demonstrated performance, with a higher value indicating a greater maturity level. 

(The various levels are defined in enc. II.) 

According to best commercial practices and DOD guidance, the minimum acceptable 

level for a technology to be included in an acquisition is TRL 6. At this level, the 

technology is considered sufficiently mature and has been engineered into a 

subsystem or prototype that closely resembles the final design. Also, the technology 

has been successfully demonstrated to work in a relevant environment. DOD policy6

prefers the maturity to reach TRL 7—a prototype demonstration in an operational 

environment. A TRL 7 for a satellite would mean the technology prototype has 

achieved form, fit, and function and has been demonstrated in space. Commercial 

satellite companies frequently meet these criteria by including a new technology on 

an existing satellite design for demonstration purposes. Also, NASA usually requires 

all mission-critical technologies to be demonstrated in space before being placed on a 

new system. In some cases, demonstrating space technologies in an operational 

environment is important because operating a system in the harsh temperatures and 

radiation environment of space—where a satellite must last essentially maintenancefree for 10 to 15 years—is much more challenging than land-based operations. The 

new space acquisition policy does not require a minimum threshold for including new 

technology on a space acquisition program. 

Critical technologies for TSAT include laser optics that can transport information 

over long distances in much larger quantities than radio waves; high-speed routers 

that enable multi-user networks, sophisticated data packaging; security algorithms 

and management utilities; multi-beam antennas; and software reprogrammable 

terminals. Table 1 shows that most of these technologies were at a TRL 3 or 4 in 

October 2003. When a technology is classified as a TRL 3, it means most of the work 

performed so far has been based on analytical studies and a few laboratory tests may 

have been conducted. A TRL 4 means some of the key components have been wired 

and integrated and have been demonstrated to work together in a laboratory 

environment. Significant effort is required to move from these TRL levels to a TRL 6, 

the minimum needed to effectively begin a new acquisition program. As shown 

below, the program office estimates that most of these technologies will have 

reached a TRL 6 threshold by fiscal year 2006. 

 

6

 DOD Instruction 5000.2, Operation of the Defense Acquisition System, May 12, 2003. 
 7 GAO-04-71R Transformational Satellite Program 

Table 1: Current and Expected Technical Maturity Levels of TSAT Technologies 

Critical technology TRL as of October 2003 When TRL 6 is expected

Information protection 3-4 FY2006

Laser communication 4-5 FY2006

Information packet processing 6 FY2003

Antenna for communications on the move 4-5 FY2006

Information transmission management 3-4 FY2006

Protected bandwidth efficient modulation 3-4 FY2006

Source: MILSATCOM Joint Program Office. 

If one or more of TSAT’s critical technologies encounters development problems, a 

backup technology should be available for insertion into the program. The laser 

communications technology does not have a backup provided by another satellite 

program. Typically, a backup technology does not meet all of the user’s requirements 

and/or can negatively affect other design requirements of the new system, such as 

weight and power. For example, the alternative for TSAT’s communications antenna 

is the current AEHF antenna, which does not provide the essential communicationson-the-move capability. Reverting to alternative technologies late in a development 

program results in a series of costly design changes and a need to go back to the 

warfighter to determine if the changes are acceptable. 

Early Design Studies Have Not Been Started Yet 

As of October 2003, 2 months before TSAT’s scheduled start, the Air Force had not 

awarded contracts for early design studies. In the case of successful programs, we 

have found that the developing contractor evaluates the early designs according to 

system engineering principles to assure that designs are technically feasible, match 

the user’s needs, and can be accomplished within the time frame and funds available. 

Without this disciplined engineering process, programs can learn too late that designs 

needed to achieve the warfighter’s requirements are not feasible. Program managers 

then have little choice but to ask for more time and money to develop better designs, 

or they must compromise by asking the warfighter to accept a less capable backup 

design or technology. When discovered late in a development program, these changes 

can be costly. Our prior work has shown that the cost to change the design increases 

significantly as a program progresses through the key decision points of an 

acquisition program. For this reason, most commercial companies want greater 

assurance early in a program that the design is feasible and producible. 

The Air Force plans to competitively award contracts for early design studies in 

December 2003, which is when the TSAT program is scheduled to start. These studies 

are to be completed in 2006, when contractors are expected to deliver a design 

specification in preparation for final design efforts. To prepare for the next step—

critical design review—in 2007, the Air Force plans to assess the preliminary designs 

and select one or both contractors to continue with detailed design studies and 

development activities. Figure 2 shows key dates in TSAT’s acquisition schedule. 
8 GAO-04-71R Transformational Satellite Program 

After hearing senior warfighters express concerns about the ambitious schedule, the 

Air Force recently extended the launch date for the first TSAT from 2009 to 2011. 

However, the additional 2 years was mostly allocated to the build-and-test phase prior 

to launch. The front end of the acquisition schedule—technology development and 

design—remains much as it was before the extension. The technology development 

phase was not extended and the preliminary design and critical design review dates 

did not change. Based on our past reviews, the importance of technology 

development and design to the success of a program is critical and TSAT’s current 

status shows significant immaturity to be overcome. 

LACK OF EVALUATION CRITERIA RAISES CONCERNS ABOUT PENDING 

DECISION TO SHIFT FUNDS FROM TSAT TO AEHF 

Despite intense interest across DOD in the November 2004 decision, Air Force 

officials have not defined what evaluation criteria they intend to use to assess 

alternatives if the TSAT program should falter. Senior military commanders have 

asked for assurances that promised communications capabilities will be delivered 

early in the next decade. If TSAT is likely to miss its promised launch date of 2011, 

they want funding to be allocated to complete the AEHF constellation of satellites. 

However, senior DOD and Air Force officials told us that if a fourth AEHF were 

acquired and a full AEHF constellation were delivered to the warfighter as originally 

planned, decision makers and funding organizations within DOD may want to wait 

until AEHF has reached the end of its useful life before replacing it with a next-
 9 GAO-04-71R Transformational Satellite Program 

generation satellite, such as TSAT. If the fourth AEHF is acquired, officials believe 

TSAT will be delayed by at least a decade. To these officials, this is not a tenable 

scenario because they see TSAT as the linchpin in DOD’s plan to transform military 

communications and related combat systems. 

To promote well-informed and objective investment decisions, our past work has 

found that decision makers establish and use measurable criteria for evaluating the 

costs, benefits, and risks of various alternatives. Although senior DOD and Air Force 

officials told us that they expect to have accomplished a number of tasks before 

making the November 2004 decision, they have not established measurable 

evaluation criteria for deciding whether to shift funds from TSAT back to AEHF. 

CONCLUSIONS 

DOD has embarked on a new transformational communications architecture to take 

advantage of emerging technologies and to remove communications constraints from 

combat. The department has told the warfighter and Congress that TSAT is a key 

system that is necessary to achieve this architecture. Responding quickly, the Air 

Force has set an imminent deadline of December 2003 to start the TSAT program. By 

starting the program so soon, the Air Force is moving ahead without mature 

technologies and early design studies—two pillars of knowledge that would help 

program officials to reliably establish cost, schedule, and performance goals. This 

knowledge is not expected to be available until 2006. Our work over the years has 

found that when programs have been started without the requisite knowledge, 

program managers and contractors are later burdened by unreasonable expectations 

about cost, schedule, and performance. Problems usually arise later that lead to cost 

increases, delays in delivering needed capability to the warfighters, and performance 

shortfalls. 

For the planned November 2004 decision about whether to fund TSAT or AEHF, Air 

Force officials would be in a better position to make a well-informed, objective 

decision if they establish and use specific criteria for evaluating alternative 

investments. Reporting the Air Force’s decision-making criteria and rationale to 

Congress would enhance transparency and provide Congress with better information 

for its oversight and funding responsibilities. 

RECOMMENDATIONS FOR EXECUTIVE ACTION 

To promote better cost, schedule, and performance outcomes, we recommend that 

you direct the Secretary of Air Force to delay the start of the TSAT acquisition 

program until technologies have been demonstrated to be at an acceptable level of 

maturity (at least TRL 6) and until the developing contractor has determined through 

systems engineering that the design is feasible and producible. We also recommend 

that you direct the Secretary to provide the appropriate level of funding necessary to 
10 GAO-04-71R Transformational Satellite Program 

gain this knowledge, which is critical for building a business case to start the TSAT 

program at a later time. 

To promote a well-informed and objective decision—now scheduled for November 

2004—about whether to fund another AEHF satellite, we further recommend that you 

direct the Secretary of Air Force to: 

• establish measurable criteria for use when evaluating alternative investments 

in TSAT and AEHF and report this criteria in the Air Force’s 2005 budget 

submission; 

• consider the alternative investments in TSAT and AEHF against these 

measurable criteria; and 

• provide the rationale for how these criteria were applied in the Air Force’s 

2006 budget submission. 

AGENCY COMMENTS AND OUR EVALUATION 

In commenting on a draft of this report, the Deputy Assistant Secretary of Defense for 

Networks and Information Integration disagreed with our primary recommendation 

to delay the start of the TSAT acquisition program until technologies are sufficiently 

matured and until the contractor determines through systems engineering principles 

that the design is feasible. DOD contends that the new Air Force National Security 

Space Acquisition Policy provides sufficient controls to allow concurrent 

development of technology and product design. DOD states that starting the TSAT 

program enables it to establish the funding and program controls—such as managing 

to the acquisition program baseline—provided by the new space acquisition policy. 

DOD did, however, concur or partially concur with the other recommendations to 

provide funding to mature TSAT’s critical technologies and early designs, to establish 

criteria for making decisions, and to report these criteria and decisions to Congress. 

We believe the new space acquisition policy does not have sufficient controls to 

reverse the higher costs and longer schedules that have plagued a number of satellite 

programs. The added risks of concurrent technology and product development have 

not helped improve the typical outcome for satellite programs. In a series of best 

practices reports issued over the years, we have identified problems resulting in 

substantially different cost and schedule outcomes when compared with initial 

expectations at the outset of a new acquisition program. We have offered improved 

approaches based on the best commercial and defense practices. DOD has endorsed 

the practices that call for a disciplined acquisition approach, one that separates 

technology from product development and bases decisions at key junctures on a set 

of critical product knowledge captured by the decision point. DOD incorporated this 

knowledge-based approach in its new acquisition system policy.7

 

 

7

 DOD Directive 5000.1 and Instruction 5000.2. 
 11 GAO-04-71R Transformational Satellite Program 

DOD’s new space acquisition policy, on the other hand, is a step backward and is 

similar to an older acquisition policy that contributed to many unsuccessful 

acquisition programs of the past. DOD’s history is filled with examples of programs 

that concurrently developed technology and new products and made decisions based 

on risk mitigation plans instead of knowledge about the new products. Our June 2003 

report8

 on common problems in satellite programs identified Milstar, SBIRS-Low, 

SBIRS-High, AEHF, and others as suffering the consequences of this earlier 

acquisition strategy. Additionally, we have found that setting an acquisition program 

baseline that is not rooted in key product knowledge is unreliable and not useful as a 

management tool. In fact, starting the program before technologies are mature and a 

feasible design study is completed reduces accountability and straps the program 

manager and the contractor with unreasonable expectations in the baseline. 

Therefore, we believe that because DOD’s new space acquisition policy does not 

require a knowledge-based acquisition strategy, it is destined to repeat the problems 

of the past. 

DOD stated that extensive studies done over the last two years provide sufficient 

information for the Milestone Decision Authority to determine if the TSAT program 

should be initiated. However, these studies do not provide product-specific 

knowledge for building a business case for TSAT. Instead, these studies were focused 

on developing the overarching communications architecture rather than detailed 

technology and design information needed to build and launch TSAT. 

While it is key to complete early design efforts before starting the program, 

substantial investments in system design and development are at risk if the Air Force 

cannot demonstrate TSAT’s technologies, a number of which were still in the early 

paper study phase without hardware demonstrations to support that they would 

work. In its fiscal year 2004 budget submission, the Air Force had budgeted over $800 

million in fiscal years 2004 and 2005 for system design and development. 

To support its case for starting the TSAT program in December 2003, DOD states 

backup technologies exist and are ready to fill any technology void that might occur. 

They believe this will reduce the risk. However, there are no backup technologies 

that will satisfy the two most critical warfighter requirements—laser communications 

(critical to transporting intelligence, surveillance, and reconnaissance data) and 

communications on the move (critical to the Future Combat System). These 

capabilities were the primary basis for persuading the warfighter to favor the 

uncertain future of TSAT rather than to acquire the full constellation of four AEHF 

satellites, which would have provided a 500 percent increase over the 

communications capability used in Operation Iraqi Freedom. 

If TSAT’s investments were based on knowledge captured from mature technologies 

and feasible design, then these informed decisions would reduce the potential for 

major and costly changes as the program enters the build-and-demonstration phase, 

 

8

 U.S. General Accounting Office, Military Space Operations: Common Problems and Their Effects on 

Satellite and Related Acquisitions, GAO-03-825R (Washington, D.C.: June 2, 2003). 
12 GAO-04-71R Transformational Satellite Program 

when it is too late to consider other options. We believe it is better to keep options 

open now, such as AEHF, and decide at a later time when enough knowledge has 

been gained to ensure TSAT is the right solution for the 2010 time frame. Our past 

work shows the negative outcomes of the concurrent and risk mitigation approach to 

acquisition. We also have shown the potential for more successful outcomes if a 

knowledge-based approach is applied. Therefore, we stand by our recommendation 

that TSAT’s program start should be delayed until technologies are mature and the 

developing contractor has completed studies to demonstrate a feasible design. 

To ensure that the warfighter is delivered an improved capability no later than 2011, 

DOD intends to decide in November 2004, based on an assessment of TSAT’s 

progress, whether funding should be diverted back to the AEHF program. In its 

comments, the Air Force suggests criteria for this decision point that can only result 

in continuing the TSAT program. For example, criteria for laser communications or 

communications on the move do not apply to AEHF. These are capabilities promised 

by TSAT, not AEHF. We believe that the criteria should be based on the maturity of 

critical technologies and early design of TSAT. To ensure the transparency and 

objectivity of the decision process in November 2004, these criteria should be 

provided to Congress in the fiscal year 2005 budget for TSAT, not—as DOD 

suggests—in the 2006 budget, when the decision will already have been made. 

In response to DOD’s detailed comments, we made changes to the report where 

appropriate to correct technical inaccuracies. DOD’s comments are provided in 

enclosure III. 

SCOPE AND METHODOLOGY 

In conducting our review, we analyzed the extent to which the TSAT and APS 

programs have acquired the knowledge needed to set specific cost, schedule, and 

performance goals. To do this, we compared the acquisition strategy with GAO’s 

knowledge-based acquisition model and analyzed the differences between them. We 

specifically focused on the portion of knowledge-based acquisition dealing with the 

necessity of matching user’s needs with developer’s resources prior to making a 

development commitment. We collected and analyzed information from the Office of 

the Assistant Secretary of Defense for Command, Control, Communication and 

Intelligence (ASDC3I), Defense Information Services Agency (DISA), the National 

Security Agency (NSA), Air Force Space Command (AFSPC), U.S. Strategic 

Command (USSTRATCOM), Military Satellite Communication Joint Program Office 

(MJPO), Joint Forces Command (JFCOM), Aerospace Corporation and RAND 

Corporation. We conducted our review from February 2003 through November 2003 

in accordance with generally accepted government auditing standards. 

- - - - - - - - - 
 13 GAO-04-71R Transformational Satellite Program 

As you know, 31 U.S.C. 720 requires the head of a federal agency to submit a written 

statement of actions taken on our recommendations to the Senate Committee on 

Governmental Affairs and the House Committee on Government Reform not later 

than 60 days after the date of the report and to the Senate and House Committees on 

Appropriations with the agency’s first request for appropriations made more than 60 

days after the date of this report. 

We are sending copies of this report to interested congressional committees. We will 

also make copies available to others upon request. In addition, the report will be 

available at no charge on the GAO Web site at http://www.gao.gov. 

If you or your staff has any questions concerning this report, please contact me at 

(202) 512-4841. Key contributors to this report were Lily Chin, Mike Hazard, Dave 

Hubbell, Travis Masters, and Matt Mongin. 

Sincerely yours, 

Robert E. Levin 

Director, Acquisition and Sourcing Management 
14 GAO-04-71R Transformational Satellite Program 

Enclosure I: Descriptions of Communication Satellites

The Air Force is developing the following communication satellites. 

Wideband Gapfiller Satellite

The Wideband Gapfiller Satellite (WGS) system is a joint Air Force and Army 

program intended to provide communications to U.S. warfighters, allies, and coalition 

partners during all levels of conflict, short of nuclear war. WGS will provide essential 

communications services for the commanders in chief to command and control their 

tactical forces. Tactical forces will rely on WGS to provide high-capacity links to the 

terrestrial portion of the Defense Information Services Network. WGS is the next 

generation wide-band component in the Department of Defense’s (DOD) future 

Military Satellite Communications architecture. WGS is composed of three principal 

segments: Space Segment (satellites), Terminal Segment (users), and Control 

Segment (operators). The WGS program is leveraging commercial methods and 

technological advances in the satellite industry to rapidly design, build, launch, and 

support a constellation of highly capable military communications satellites. 

The WGS program is being conducted as a DOD commercial acquisition and as such 

is not subject to the same milestone and/or review processes required in other space 

acquisition programs. The Air Force reports that 95 percent of satellite content will 

be commercial off-the-shelf products. The total budget for purchasing five WGSs is 

$1.5 billion. The contract is firm fixed price over 10 years and was awarded to Boeing 

Satellite Systems in January 2001. The Air Force purchased the first two satellites in 

fiscal year 2002 and the third satellite in fiscal year 2003. It plans to purchase 

satellites four and five in fiscal years 2007 and 2008, respectively. The first two WGS 

satellites are scheduled for launch in fiscal year 2005, with the third satellite planned 

for launch in fiscal year 2006. 

Upon first launch into geosynchronous orbit in 2005, WGS will be the DOD’s most 

capable and powerful communications satellite. Ultimately, five WGSs will be in 

orbit, providing service in both the X- and Ka band-radio frequencies. Each satellite is 

expected to have a capacity of at least 2,100 megabits per second. WGS will augment 

X-band communications now provided by the Defense Satellite Communications 

System (DSCS) and one-way Ka-band service provided by the Global Broadcast 

Service (GBS). Additionally, WGS will provide new two-way Ka-band services. These 

satellites are not interconnected. They will, however, provide communications 

capacity, connectivity, and flexibility for U.S. military forces while maintaining full 

interoperability with existing and programmed DSCS and GBS terminals. 

Advanced Extremely High Frequency Satellite

The Advanced Extremely High Frequency (AEHF) satellite system is to be DOD’s 

next generation of high-speed, secure communication satellites. This satellite system 

is intended to replace the existing communications satellites with improved, 

survivable, jam-resistant, worldwide, secure communication capabilities at lower 
 15 GAO-04-71R Transformational Satellite Program 

launch costs. AEHF is to support the entire range of data rates to provide assured 

communications across the entire spectrum of conflict, including nuclear war. AEHF 

is also designed to be “backward compatible” with existing satellites, that is, it will 

support both low and medium data rates as necessary until an AEHF constellation 

with higher data rates becomes available at initial operating capability (two satellites 

on orbit). The first satellite is currently planned to launch in 2006 and the second is 

scheduled to launch in 2007. 

The Air Force is responsible for funding, developing, and producing the AEHF 

satellites and the associated ground control systems. The Air Force’s budget for 

developing and acquiring the first three AEHF satellites is $4.8 billion. Each service—

Army, Navy, and Air Force—is separately responsible for funding, developing, and 

producing its own terminals to communicate with AEHF. 

The AEHF program began in August 1998, and the final constellation will be 

composed of satellites in geosynchronous orbit that can transmit data to each other 

via radio frequency cross links, and communicate with ground stations and 

communication terminals carried by air, sea, and ground forces. Each satellite will 

have a capacity of about 250 megabits per second. Users communicate with the 

satellites through their terminals. The mission control segment provides command 

and control that directs the movements and other operations of satellites. 

Transformational Satellite Communications

The Transformational Satellite (TSAT) communications system is designed to provide 

improved, survivable, jam-resistant, worldwide, secure and general purpose 

communications as part of an independent but interoperable set of space-based 

systems that will support the National Aeronautics and Space Administration, DOD, 

and the intelligence community. TSAT will replace the current satellite system and 

supplement AEHF. 

The TSAT architecture, requirements, and cost baselines are to be approved in 

December 2003. Initial design contracts are to be awarded in December 2003; 

therefore, the final configuration of the TSAT system remains to be determined. Air 

Force budget documentation for TSAT (funded under the Advanced Wideband 

Satellite budget line) shows a total cost of $10.9 billion for purchasing the first five 

satellites plus a spare. 

The TSAT system will be the key transport mechanism of DOD’s space-based 

network communications system, which has individual satellites operating as routers 

in space. The TSAT constellation of five satellites will provide continuous 

communication coverage from 65 degrees south latitude to 65 degrees north. The 

satellites will support communications in the EHF and Ka band radio frequency 

bands, in addition to passing communications via lasers. The capacity of each 

satellite is expected to be at least 10 times greater than the AEHF satellites. The Air 

Force is currently conducting development activities necessary in order to make a 
16 GAO-04-71R Transformational Satellite Program 

decision to start the program in December 2003. The Air Force plans to launch the 

first TSAT in fiscal year 2011. The first two satellites will have radio frequency 

satellite cross links to engage the AEHF satellites as well as having the laser cross 

links; the third through the fifth satellites will have laser cross links only.

Advanced Polar Satellite

The Advance Polar System (APS) is a part of the Air Force’s transformational 

communication architecture and is being developed and acquired as part of the 

TSAT/APS acquisition program. APS will provide the next generation protected EHF 

band, Ka band, and laser satellite communications capability in the north polar region 

starting in fiscal year 2012. APS will support strategic as well as tactical users who 

require anti-jam and low probability of detection EHF satellite communications. The 

results of the transformational communications architecture definition will affect the 

APS program content. Requirements are based on the July 1995 Polar Operational 

Requirements Document. According to Air Force program officials, APS is to be a 

“lighter” (i.e., lower capacity) version of the TSAT. The current APS plan is to acquire 

three satellites (two funded with development funds and one funded with 

procurement dollars) and associated ground infrastructure for $1.2 billion. The three 

APS satellites will be placed in highly inclined orbits and are expected to provide 

continuous communication services to forces deployed from 65 degrees north to the 

North Pole (90 degrees north). 
 17 GAO-04-71R Transformational Satellite Program 

Enclosure II: Descriptions of Technology Readiness Levels

The Interim Defense Acquisition Guidebook (formerly DOD 5000.2-R) directs that 

technology readiness assessments, using Technology Readiness Levels (TRL) or 

some equivalent assessment methodology, for critical technologies shall occur 

sufficiently before key decision points B and C to provide useful technology maturity 

information to the acquisition review process. TRLs, originally developed by the 

National Aeronautics and Space Administration (NASA), are measured along a scale 

of 1 to 9, starting with paper studies of the basic concept and ending with a 

technology that has proven itself in actual usage on the intended product. As the TRL 

scale increases, the risks associated with uncertain technology decrease, because 

more is known about their capabilities and performance. Unexpected problems can 

arise at every level, and effort must be expended to overcome them. This effort takes 

time and can delay the progress to the next readiness level. According to our previous 

reviews of best commercial practices and DOD guidance, a minimum level of TRL 6 

should be reached before committing to a space acquisition program. Table 1 

provides a detailed explanation of each TRL. 

Table 2: TRL Scale for Assessing Critical Technologies 

Technology Readiness Levels Technology Readiness Level Description

 1. Basic principles observed and 

reported. 

Lowest level of technology readiness. Scientific research begins to be translated into 

technology’s basic properties.

 2. Technology concept and/or 

application formulated.

Invention begins. Once basic principles are observed, practical applications can be 

invented. The application is speculative and there is no proof or detailed analysis to 

support the assumption. Examples are still limited to paper studies.

 3. Analytical and experimental 

critical function and/or characteristic 

proof of concept.

Active research and development is initiated. This includes analytical studies and 

laboratory studies to physically validate analytical predictions of separate elements of 

the technology. Examples include components that are not yet integrated or 

representative.

 4. Component and/or breadboard 

validation in laboratory environment.

Basic technological components are integrated to establish that the pieces will work 

together. This is relatively “low fidelity” compared to the eventual system. Examples 

include integration of “ad hoc” hardware in a laboratory.

 5. Component and/or breadboard 

validation in relevant environment.

Fidelity of breadboard technology increases significantly. The basic technological 

components are integrated with reasonably realistic supporting elements so that the 

technology can be tested in simulated environment. Examples include “high fidelity” 

laboratory integration of components.

 6. System/subsystem model or 

prototype demonstration in a relevant 

environment. 

Representative model or prototype system, which is well beyond the breadboard tested 

for level 5, is tested in a relevant environment. Represents a major step up in a 

technology’s demonstrated readiness. Examples include testing a prototype in a high 

fidelity laboratory environment or in simulated operational environment.

 7. System prototype demonstration 

in an operational environment.

Prototype near or at planned operational system. Represents a major step up from 

level 6, requiring the demonstration of an actual system prototype in an operational 

environment. Examples include testing the prototype in a test bed aircraft. 

 8. Actual system completed and 

qualified through test and 

demonstration.

Technology has been proven to work in its final form and under expected conditions. In 

almost all cases, this level represents the end of true system development. Examples 

include developmental test and evaluation of the system in its intended weapon system 

to determine if it meets design specifications.

 9. Actual system proven through 

successful mission operations.

Actual application of the technology in its final form and under mission conditions, such 

as those encountered in operational test and evaluation. Examples include using the 

system under operational mission conditions.

Source: GAO based on NASA and DOD guidance. 
18 GAO-04-71R Transformational Satellite Program 

Enclosure III: Comments From the Department of Defense
 19 GAO-04-71R Transformational Satellite Program 
20 GAO-04-71R Transformational Satellite Program 
 21 GAO-04-71R Transformational Satellite Program 

(120225)