Military Space Systems: DOD's Use of Commercial Satellites to Host Defense Payloads Would Benefit from Centralizing Data
Released: 2018-07-30T00:00:00

Letter

Background

Commercially Hosted Payloads

DOD defines a hosted payload as an instrument or package of equipment—a sensor or communications package, for example— integrated onto a host satellite, which operates on orbit making use of the host satellite’s available resources, including size, weight, power, or communications. A commercially hosted DOD payload is a DOD payload on a commercial satellite. In general, hosted payloads may be either experimental or operational. Experimental payloads demonstrate new or existing technologies on orbit for potential use on future operational space systems. Operational payloads deliver required capabilities to end users. Hosted payload arrangements may be unsuitable for some missions. For example, some payloads may be too large or need too much power for a host satellite to feasibly accommodate, or may require unique satellite maneuvers that, if exercised, would negatively affect a host satellite’s primary mission. Civil government agencies, like NASA and the National Oceanic and Atmospheric Administration (NOAA), have used or have plans to use commercially hosted payloads. For more information on the commercially hosted payloads that civil agencies have used or plan to use, see appendix I.

Potential Benefits of Using Commercially Hosted Payloads

We and others have identified potential benefits of using commercially hosted payloads to gain space-based capability, such as:

Cost savings—Commercially hosted payloads may increase affordability because the government payload owner pays for only a portion of the satellite development and shared launch and ground systems costs, rather than for the entire system. Also, smaller, lighter, and less complex systems may shorten procurement timelines, reduce research and development investment, and reduce risk in technology development. Some government agencies have reported saving hundreds of millions of dollars to date from using innovative arrangements such as hosted payloads.

Faster on-orbit capability—Because commercial satellites tend to take less time from concept development to launch than DOD systems do and have relatively frequent launches, hosting government payloads on commercial satellites may achieve on-orbit capability more quickly.

Increased deterrence and resilience—Distributing capabilities across more satellites increases the number and diversity of potential targets for an adversary and may make it more difficult for an adversary to decide which assets to attack, serving as a deterrent. Additionally, more frequent launches could increase DOD’s ability to reconstitute its satellite groups—or constellations—more quickly in case of unexpected losses of on-orbit capabilities. Recent strategic and policy guidance government-wide and at DOD have stressed the need for U.S. space systems to be survivable, or resilient, against intentional and unintentional threats—both types of which have increased over the past 20 years. Intentional threats can include purposeful signal jamming, laser dazzling and blinding of satellite sensors, missiles intended to destroy satellites, and ground system attacks. Some unintentional threats to satellites are created by the harsh space environment itself, like extreme temperature fluctuations and radiation, and the growing number of satellites, used rocket parts, and other space debris on orbit, which could collide with orbiting satellites.

Continual technology upgrades and industrial base stability— New technologies may be continually incorporated into space systems using hosted payloads, which may be uniquely suited for higher rates of production and launches than traditional DOD satellites. Using commercial satellites for government payloads could help maintain the U.S. commercial space industry’s ongoing technology developments by maintaining stable business and incentivizing new companies to enter the marketplace. Further, increased production may be distributed over multiple contractors—including traditionally lower-tier contractors—to foster more competition.

As we reported in October 2014, hosted payloads are among several avenues DOD is considering to increase the resilience of its satellites in the face of growing threats. DOD has been looking at ways to break up larger satellites into multiple smaller satellites or payloads after decades of building large, complex satellites to meet its space-based requirements. The broader concept of breaking up larger satellites into smaller ones is known as disaggregation. In 2014, we reported that DOD lacked critical knowledge about the concept of disaggregation, including how to quantify a broad range of potential effects. At the time, for example, DOD did not have common measures for resilience, which we found is a key consideration in making a choice as to whether to continue with a current system architecture or to change it. Recently, senior DOD officials have also made public statements that indicate a willingness to consider innovative acquisition approaches so that acquisition timelines can be reduced. For example, in a 2016 strategic intent document, the Commander of Air Force Space Command stated that the Air Force should seek innovative acquisition approaches that leverage DOD’s buying power across the industry. Additionally, the Secretary of the Air Force stated that the Air Force is exploring more affordable and innovative ways to acquire its satellite communication services through investments in commercial industry and international partnerships.

Matching Payloads with Commercial Host Satellites

Opportunities to match a DOD payload with a commercial host can arise in various ways. DOD may first develop a payload and seek to match it with a commercial host, DOD may work in tandem with a commercial company to develop a payload to be hosted, or commercial companies— likely the satellite owner, operator, or system integrator—can first identify upcoming satellite hosting opportunities to DOD. In each scenario, the DOD program (or payload owner) and the commercial host generally consider the basic properties of both the payload and host satellite in attempting to find a match. These properties—including the size, weight, area, power, and required orbital characteristics of the payload and host satellite—should be complementary to create an arrangement that is mutually compatible for each party, according to Aerospace Corporation recommendations and officials we spoke with. Specifically, these properties include:

The size of the payload when it is stowed and when it is deployed on orbit, including the available area on the host satellite;

The available weight and mass distribution the host satellite can

The available power on the host satellite;

The thermal requirements of the payload and corresponding capability of the host satellite;

The requirements to limit electromagnetic interference—disturbances that affect electrical circuits on the payload and host satellite;

The available command, telemetry, and mission data rate requirements of the payload and corresponding capability of the host satellite;

The compatibility of interfaces between the payload and host satellite;

The pointing accuracy and stability of the host satellite; and

The necessary orbits, including altitude and inclination.

Other considerations when matching a DOD payload with a host satellite are the compatibility of radio frequency spectrum (spectrum) needs between the payload and host, and the satellite’s intended orbital location. Spectrum is a natural resource used to provide essential government functions and missions ranging from national defense, weather services, and aviation communication, to commercial services such as television broadcasting and mobile voice and data communications. The frequencies, or frequency bands, of spectrum have different characteristics that make them more or less suitable for specific purposes, such as the ability to carry data long distances or penetrate physical obstacles. Each frequency band has a limited capacity to carry information. This means that multiple users operating at approximately the same frequency, location, and time have the potential to interfere with one another. Harmful interference occurs when two communication signals are either at the same frequencies or close to the same frequencies in the same vicinity, a situation that can lead to degradation of a device’s operation or service. As such, a payload or satellite’s specific placement in any given orbit could potentially interfere with a neighboring payload or satellite in the same orbit.

In the United States, the National Telecommunications and Information Administration (NTIA) of the Department of Commerce is responsible for establishing policy on regulating federal government spectrum use and assigning spectrum bands to government agencies. The Federal Communications Commission (FCC) allocates spectrum and assigns licenses for various consumer and commercial purposes. Additionally, all government and commercial satellite programs must apply for approval to operate at a given orbital location using a given band of spectrum internationally through the International Telecommunication Union (ITU). The ITU is an agency of the United Nations and coordinates spectrum standards and regulations.

The Air Force’s Hosted Payload Office

In 2011, the Air Force created the Space and Missile Systems Center’s (SMC) Hosted Payload Office (HPO) to provide acquisition architectures that achieve on-orbit capability more quickly and affordably. The HPO uses various resources and capabilities to meet its objectives:

Hosted Payload Solutions Contract: In 2014, SMC established the Hosted Payload Solutions (HOPS) multiple award indefinite delivery indefinite quantity (IDIQ) vehicle. According to HPO documents, SMC established the contract—available to all DOD and civil agencies—to streamline commercially hosted payload arrangements by selecting a pool of commercial vendors that government payload owners can use to access space on commercial host satellites. Programs do not have to use HOPS, however, and may contract with commercial companies directly. The HOPS vehicle includes 14 vendors across the commercial satellite industry. SMC awarded task orders for studies to each of the vendors with a contract to gather information on potential host opportunities, orbits and launch schedules, cost estimates for hosting fees, and existing host satellite interfaces.

Feasibility Studies: Using the information it gathered from the 14 vendor studies, the HPO stated that it built a database to provide information on potential satellite hosts and the suitability of certain payloads for host opportunities, including cost estimates. The HPO stated that it can use this information to assess the feasibility of a hosted payload opportunity for interested SMC space programs. The HPO also conducts feasibility studies for interested programs based on publicly available information and from industry requests for information.

Hosted Payload Interface Design guidelines: The HPO published hosted payload interface design guidelines to provide technical recommendations for hosted payload developers. According to HPO officials, the intent of these guidelines is to reduce integration costs and improve the host-ability of all hosted payloads.

Hosted Payload Data Interface Unit: The HPO is developing a secure hosted payload data interface unit to protect payload data from unauthorized access by the host. Following its release of draft documentation to industry stakeholders in March 2018, the HPO is currently integrating National Security Agency requirements into its request for data interface unit prototype proposals. According to HPO officials, the office plans to issue a request for prototype proposals in May 2018, integrate a data interface unit and payload in 2020, and launch the integrated system in 2022.

Hosted Payload Expertise: The HPO provides general advice and expertise to programs in the form of hosted payload architectural studies, input on acquisition planning and strategy documents, and other research efforts, according to the office.

DOD Has Used Commercially Hosted Payloads Three Times and Three More Missions Are Planned or Underway

Since 2009, DOD has launched three experimental payloads on commercial host satellites and plans to conduct three more missions through 2022, as shown in figure 1. DOD estimates that it has achieved cost savings of several hundred million dollars from these experimental payloads. According to DOD officials, DOD expects to realize additional cost savings and be able to place capabilities on orbit more quickly from several hosted payload efforts that are planned or underway. Opportunities for additional hosted payload efforts may arise in the near term amid DOD planning for upcoming and follow-on space systems.

DOD Has Used Commercial Satellites to Host Three Experimental Payloads

Since 2009, DOD has placed experimental payloads—intended to test or demonstrate an on-orbit capability—for three programs on commercial host satellites. Several officials within DOD told us that experimental payloads tend to be smaller, less expensive, and their missions more risk- tolerant than traditional operational DOD payloads. In these ways, they said experimental payloads are better-suited to hosting arrangements than operational DOD payloads. The Air Force has not yet used the HOPS multiple award IDIQ vehicle—which was awarded to facilitate commercially hosted payload arrangements—to match a government payload with a commercial host. The HPO told us that, in 2019, NASA and NOAA will be the first agencies to use the HOPS vehicle to find a host satellite for two of their payloads. Table 1 describes the three experimental payloads hosted on commercial satellites to date. For more information on civilian agencies that use or plan to use commercially hosted payloads, see appendix I.

Air Force officials told us that using commercial host satellites for their experimental payloads has saved several hundred million dollars across these programs and shortened timelines for launching payloads into space. For example, the HPO estimated that the Air Force saved nearly $300 million by using a commercial host satellite for its Commercially Hosted Infrared Payload (CHIRP), as compared to acquiring the same capability using a dedicated, free-flying satellite. In addition, Air Force officials estimated that using commercial host satellites for its Responsive Environmental Assessment Commercially Hosted (REACH) effort saved the Air Force approximately $230 million. The REACH effort consists of over 30 payloads hosted on multiple satellites. Further, because of the commercial host’s launch schedule, the Air Force achieved its on-orbit capability sooner than if it had acquired free-flying satellites. In April 2013, we found that the Internet Protocol Routing in Space (IRIS) payload, launched in 2009, was a commercially hosted payload pilot mission that would provide internet routing onboard the satellite, eliminating the need for costs associated with certain ground infrastructure.

DOD Has Three Commercially Hosted Payload Efforts Planned or Underway

DOD and Air Force officials told us they are planning to pursue commercially hosted payloads for three programs in the coming decade to achieve cost savings and on-orbit capability more quickly. In each case, officials said they have identified cost and schedule benefits for their respective programs. For example, the Missile Defense Agency (MDA) stated that it expects to save approximately $700 million compared to the cost of traditional, free-flying satellites by acquiring its Spacebased Kill Assessment capability as payloads on commercial host satellites, and expects to achieve on-orbit capability years earlier than if it had acquired dedicated satellites for these payloads. Additionally, a program official from the Defense Advanced Research Projects Agency (DARPA) told us DARPA plans to use a commercially hosted payload for the Phoenix Payload Orbital Delivery effort to test more affordable ways to access space. Moreover, Air Force officials told us they expect to save $900 million over free-flying satellites by using two Space Norway satellites to fly an Enhanced Polar System Recapitalization payload. Space Norway plans to launch its satellites in 2022, which the Air Force expects will allow it to meet its need for DOD’s required capability. See table 2 for additional details on DOD’s planned hosted payloads.

Additional opportunities for commercially hosted payloads may be forthcoming as DOD develops requirements and designs for new and follow-on space programs. DOD has been analyzing various alternatives to explore possible future space system designs and acquisition strategies for several of its upcoming follow-on programs. In these cases, the analysis of alternatives (AOA) study guidance, set forth by DOD’s Office of Cost Assessment and Program Evaluation, included direction for the studies to consider new approaches for acquiring space capabilities. For example, AOA guidance directed study teams to include hosted payloads or other disaggregated designs, and commercial innovations in technology and acquisition to meet some space mission requirements. Table 3 provides further details of recently completed and ongoing AOAs to study new designs—or architectures—for upcoming follow-on satellite systems.

Logistical and Data Challenges Contribute to Limited Use of Hosted Payloads

Two factors have contributed to DOD’s limited use of commercially hosted payloads. First, DOD officials identified logistical challenges to matching government payloads with any given commercial host satellite. For example, most of the offices we spoke with cited size, weight, and power constraints, among others, as barriers to using hosted payloads. Second, while individual DOD offices have realized cost and schedule benefits, DOD as a whole has limited information on costs and benefits of hosted payloads. Further, the knowledge it has gathered is fragmented across the agency—with multiple offices collecting piecemeal information on the use of hosted payloads. The limited knowledge and data on hosted payloads that is fragmented across the agency has contributed to resistance among space acquisition officials to adopting this approach.

DOD Officials Cite Logistical Challenges to Matching Payloads to Hosts

DOD acquisition officials within the Office of the Secretary of Defense told us matching requirements between government payloads and commercial satellites is typically too difficult for programs to overcome. Specifically, they said the cumulative complexity of matching size, weight, power, and spectrum needs; aligning government and commercial timelines; and, addressing concerns over payload control and cybersecurity amounts to too great a challenge.

DOD’s Hosted Payload Office is developing tools designed to help address these challenges and DOD offices that have used hosted payloads have also found ways to overcome them.

Matching Size, Weight, and Power

Officials from DOD acquisition and policy offices, as well as Air Force and industry officials we spoke with, cited matching size, weight, and power between DOD payloads and commercial host satellites as a challenge. We similarly found in April 2013 that ensuring compatibility between payloads and host satellites can pose challenges because not all commercial satellites are big enough or have enough power to support hosting a payload. Whether a host satellite can accommodate a payload can depend on the size of the payload. Additionally, according to industry representatives, the space taken up by the hosted payload affects the amount of revenue-generating payloads the host may place on its satellite, such as additional transponders—devices that emit and receive signals—for the communications services it provides to customers. The complexity of integrating a government payload onto a commercial host can also drive the overall cost of the arrangement.

However, officials said these challenges can be mitigated through the use of various expertise and lessons learned. HPO officials and industry representatives have proposed several approaches to help match properties like size, weight, and power between a DOD payload and a commercial host satellite. The HPO is developing a hosted payload interface unit that could potentially provide a standard for payload developers and system integrators to develop and test their systems. One commercial company proposed an interface unit that would accommodate a “universal” DOD payload. Additionally, industry experts stated that with sufficient planning and time for system integration, nearly any payload can be accommodated on a host satellite.

The HPO issued guidelines in 2017 to assist DOD payload developers in working toward typical payload requirements and standards for host satellites in low Earth orbit and geostationary Earth orbit. These guidelines inform the payload’s electrical power and mechanical designs. The principal guideline—echoed by the successful CHIRP demonstration in 2011—is that the hosted payload must “do no harm” to the mission performance of its host. Also, satellite interfaces can vary from company to company. Some commercial companies had experience with the task—and business opportunity—of integrating multiple customers’ payloads onto satellites since at least the 1990s.

Matching Spectrum Needs

Air Force, HPO, and industry officials told us that, ideally, the payload should use the same spectrum allocation as the commercial host. They said that this is due in part to the lengthy satellite registration process that takes place in the United States and through the ITU that must be undertaken prior to placing a satellite on orbit. Some DOD officials added that the process for all new satellites from initial filing to ITU approval takes around 7 years. If a satellite owner registers for one frequency band of spectrum and later requires a different band, the owner has to begin the registration process from the beginning—restarting the 7-year timeline. This can be problematic for DOD payload owners seeking to match their military communications payload with an already-registered host satellite—particularly if the host satellite’s spectrum allocation is incompatible with the DOD payload. HPO and other DOD officials said that very different spectrum needs between payload and host would therefore preclude the match.

Moreover, a need for military—as opposed to commercial—spectrum for communications payloads can introduce additional complications. Although a process exists for a commercial satellite owner to license military spectrum for use by a hosted payload, representatives from DOD’s Chief Information Officer’s (CIO) office could cite only one instance where this has happened. One possible explanation stems from a 2012 memorandum from DOD’s CIO that outlines various preferred processes for a commercial host satellite to host military communications payloads. Several industry officials we spoke to said that the various processes outlined in the 2012 memorandum would add to the already-lengthy process of spectrum registration. Further, the memorandum instructs that contractual terms between the payload and host satellite owners should restrict all military spectrum use exclusively to the U.S. military. However, one industry official told us that international entities do not necessarily recognize U.S. military spectrum, and commercial companies that obtain licenses through other countries are permitted to use those frequencies. For example, a senior official of one commercial company we met with stated that the company licensed U.S. military spectrum through another North Atlantic Treaty Organization government after failing to successfully coordinate an FCC request with DOD and NTIA. DOD and industry representatives told us that from a business perspective, it makes little sense for a commercial company to seek hosting opportunities for DOD payloads that require U.S. military spectrum.

Matching Government and Commercial Development and Acquisition Timelines

Government and industry officials we spoke with said that aligning the development and acquisition timelines of a government payload and commercial host satellite is a challenge. The timeline associated with developing government sensors is generally much longer than that of commercial satellites, potentially creating difficulties in scheduling and funding commercially hosted payload arrangements. For example, DOD satellite systems take, on average, over 7 years to develop and launch a first vehicle, while commercial satellite programs typically take between 2 and 3 years. DOD payload owners may find it challenging to accelerate development and acquisition schedules to match those of the commercial satellite host. Additionally, DOD officials we spoke with said that their budget and planning processes require funding commitments up to 2 years in advance of actually receiving those funds. This can further complicate alignment with commercial timelines because the development of a government sensor would need to be underway well in advance of a decision to fund a commercially hosted payload approach. Furthermore, federal law generally prohibits agencies from paying in advance for a future service or from obligating future appropriations.

However, several DOD and other government agency officials we spoke with said that it is possible to align government and commercial timelines. For example, MDA adopted the commercial host’s schedule to ensure its Spacebased Kill Assessment payload was ready for integration and launch without delaying the host satellite or worse—missing its own ride to space. DARPA officials told us they were also able to align DARPA acquisition and development schedules with the commercial host. The Air Force’s Enhanced Polar System (EPS) Recapitalization program officials were able to leverage existing documents such as requirements documents and acquisition strategies from the predecessor program to speed up the acquisition process. According to Air Force officials, the EPS Recapitalization program had a unique opportunity to take advantage of the availability of a commercial host and had the support of a high ranking Air Force official that enabled the program to move forward using a commercially hosted payload approach.

Maintaining Payload Control and Cybersecurity

Some officials cited concerns with combining government and commercial space missions. For example, officials across DOD told us they were wary of losing control over a hosted payload should a commercial company’s needs change. They said that theoretically, a commercial provider could decide to turn off power to the government’s payload if the host satellite needed extra power to perform a certain function. Additionally, DOD space program officials expressed concern that commercial practices for ensuring the mission success of the payload may not be up to government standards—that commercial testing and integration standards may be less robust than those used by traditional government programs to ensure success, adding risk to the government payload. Furthermore, officials in one DOD program office expressed a distrust of commercial host motives in offering to support a government payload on their satellite, suggesting that a company could be intending to steal government technologies. However, industry officials we spoke with said that DOD can generally issue a solicitation that includes necessary stipulations. For example, including a condition to preserve the payload’s priority of mission and other terms to protect the government’s investment may provide some assurance to those officials that perceive security risks.

Additionally, some officials we spoke to cited cybersecurity concerns. They cited loss of control over data security as a challenge to using hosted payloads. Officials told us the data could be vulnerable to eavesdropping or manipulation as it travels between government ground systems and the commercially hosted government payload. However, according to HPO officials, the Air Force overcame this challenge on the CHIRP mission by procuring a secure interface that provided a data link between the payload and dedicated transponder and ground terminal. As mentioned previously, the Hosted Payload Office is developing a hosted payload data interface unit to mitigate this challenge by securing payload data communications from the host satellite.

Department-wide Information on Commercially Hosted Payloads Is Limited and Fragmented Across Offices

DOD, at the department-wide level, has limited information on commercially hosted payloads—mostly due to a lack of experience in using hosted payloads and complexities associated with them. For example, acquisition officials in the Office of the Secretary of Defense told us that DOD needs more data and analysis of the potential costs and benefits. However, realistic cost modeling for commercially hosted DOD payloads is unavailable because costs can vary across potential hosts and DOD has minimal experience using commercial hosts. Similarly, the HPO performs market research and cost estimates based on data from commercial companies, but according to one official in the HPO, the costs tend to vary based on the supply and demand in the commercial satellite industry. Additionally, HPO officials said their cost savings analyses are based on only two real-world commercially hosted DOD payloads— CHIRP and REACH. HPO officials told us that with additional government data they could compare the costs of system architectures that include free-flier satellites with those that use commercially hosted payloads. Additionally, some potential benefits of using commercially hosted payloads, such as resilience, may be difficult to measure. In our 2014 report on disaggregation, we recommended that DOD define key measures related to disaggregation, including developing metrics to measure resilience. DOD is in the process of developing standard metrics for resilience.

DOD’s knowledge of commercially hosted payloads is also fragmented across the agency. Several DOD offices are independently conducting activities related to commercially hosted payloads, such as pursuing commercially hosted payload arrangements, developing lessons learned, and determining demand for commercial hosts. For example, MDA officials told us they have developed cost and technical data and lessons learned based on MDA’s Spacebased Kill Assessment payload— launched earlier this year—but have not shared it across the agency. On the other hand, the Space Test Program, also housed within the Air Force’s SMC develops lessons learned on its payloads, which are government payloads on government host satellites and officials there told us they provide lessons learned to the HPO. In October 2017, SMC’s Launch Office sent a request for data on hosted payloads to DOD agencies, research laboratories, and universities, but the HPO was not an active participant in this request. Independent efforts within DOD to collect and analyze cost, schedule, and performance results from hosted payloads can create fragmentation in DOD’s knowledge base and can increase the risk of duplicative efforts within DOD.

DOD does not collect or consolidate agency-wide knowledge on commercially hosted payloads and has no plans to do so. Agency officials stated that DOD does not require programs outside of SMC to consult the HPO when seeking commercially hosted payload arrangements. The Air Force established the HPO to facilitate commercially hosted payloads, however, the 2011 Program Management Directive that established the HPO states that the HPO will coordinate with SMC directorates for detailed implementation of hosted payloads but does not address coordination with agencies or directorates outside of SMC. According to an HPO official, programs are not required to use HPO expertise or tools as they pursue using hosted payloads. Further, this official stated that programs are not required to provide any data or lessons learned to the HPO, or any other central point within DOD, following the pursuit or completion of a hosted payload arrangement. The 2011 Program Management Directive directs the HPO to provide lessons learned to SMC directorates but does not direct SMC offices to share information— such as costs, technical data and lessons learned on completed commercially hosted payload efforts—with the HPO. An HPO official indicated that the HPO obtains data through informal communication with those programs using hosted payloads that are willing to share data.

We found that limitations and fragmentation of data and knowledge are contributing to resistance within DOD to using hosted payloads. Several DOD acquisition and program officials we spoke with who did not have experience with hosted payloads generally stated that the potential risks to using hosted payloads outweighed the benefits, and that there was little evidence-based analysis to prove otherwise. They were not aware of existing tools that could assist them in making decisions even though the HPO has been developing these tools and has made efforts to share them within SMC. DOD acquisition and program officials consistently cited a preference for maintaining the acquisition status quo over introducing any perceived added risk to their programs. At the same time, however, officials who have used hosted payloads were able to overcome logistical and technical challenges and realize cost savings. However, according to an HPO official, there is currently no requirement in place to facilitate sharing their approaches to doing so. We have reported in the past that DOD’s culture has generally been resistant to changes in space acquisition approaches and that fragmented responsibilities for acquisitions have made it very difficult to coordinate and deliver interdependent systems.

Moreover, our past studies of commercial strategic sourcing best practices have found that that leading companies centralize procurement decisions by aligning, prioritizing, and integrating procurement functions within the organization. Establishing the Hosted Payload Office is one step in this direction, but the office is organized under the Advanced Systems and Development Directorate—a research and development organization—under SMC. Moreover, the 2011 directive that established the HPO does not address coordination or responsibilities for agencies or directorates beyond SMC. Consolidating knowledge is important because it allows organizations to share information and data upon which to develop consistent procurement tactics, such as ways to overcome challenges in matching a government payload with a commercial host. As we found in our work on commercial strategic sourcing best practices, organizations that struggled with fragmented information in the past overcame this challenge in part by consolidating their data on costs and spending. While hosted payload acquisitions are not a typical service acquisition, successful organizations have found that these techniques work for highly specialized technical services for which few suppliers exist.

Conclusions

As DOD considers new architectures and acquisition approaches, commercially hosted payloads have the potential to play a role in delivering needed capabilities on orbit more quickly and at a more affordable cost than traditional DOD space acquisitions. Placing DOD payloads on commercial satellites might also be an effective method by which to increase resiliency. However, DOD’s experience and the data collected so far are limited in informing decisions on the use of these payloads. DOD would benefit from leveraging the knowledge and information gained from each hosted payload experience. Centralized collection and assessment of agency-wide data would help enable DOD to mitigate the logistical challenges inherent in matching payloads to hosts, and better position DOD to make reasoned, evidence-based decisions on whether a hosted payload would be a viable solution to meet warfighter needs. Without such knowledge, and a way for interested programs to leverage it, DOD may not be fully informed about using hosted payloads and may risk missing opportunities to rapidly and affordably address emerging threats in space.

Recommendation for Executive Action

The Secretary of Defense should require programs using hosted payloads to provide cost and technical data, and lessons learned to a central office. In implementing this recommendation, DOD should consider whether the Hosted Payload Office is the most appropriate office to centralize agency-wide knowledge. (Recommendation 1)

Agency Comments

We provided a draft of this report to the Department of Commerce, NASA, and DOD for comment. The Department of Commerce provided technical comments, which we incorporated as appropriate. NASA did not have comments on our draft report. In its written comments, DOD concurred with our recommendation and stated that SMC had initiated a major reorganization since we drafted our report and that under the new organizational construct, the Hosted Payload Office had changed and may not be the appropriate office for centralizing DOD-wide hosted payload knowledge. DOD’s comments are reproduced in appendix II. DOD also provided technical comments which we incorporated as appropriate.

We are sending copies of this report to the appropriate congressional committees, the Secretary of Commerce, the Secretary of Defense, the Administrator of NASA, and other interested parties. In addition, the report is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me at (202) 512-4841 or by email at chaplainc@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix III.

Appendix I: Civil and Other Agency Commercially Hosted Payloads

As shown in table 4, civil and other government agencies use commercially hosted payloads to enhance navigation systems, monitor environmental pollution, conduct scientific missions, and improve search and rescue systems. Officials from all of the agencies we spoke with cited cost savings and the ability to leverage existing commercial schedules and technologies among the reasons they use commercial host satellites.

Appendix II: Comments from the Department of Defense

Appendix III: GAO Contact and Staff Acknowledgments

GAO Contact

Cristina T. Chaplain (202) 512-4841 or chaplainc@gao.gov.

Staff Acknowledgments

In addition to the contact named above, Rich Horiuchi (Assistant Director), Erin Cohen (Analyst in Charge), Claire Buck, Jon Felbinger, Stephanie Gustafson, Matthew Metz, Sylvia Schatz, and Roxanna Sun made key contributions to this report.