Washington Post
August 15, 2001
Pg. E3
Delays, Overruns Plague Lockheed Group's New Satellite System
By Greg Schneider, Washington Post Staff Writer
A Lockheed Martin-led military satellite program is running about a year behind schedule, leaving the military's secure global communications system vulnerable to gaps in coverage.
A Pentagon panel will meet today to review the Advanced Extremely High Frequency satellite system (known as Advanced EHF) with an eye toward deciding later this month whether to move ahead with the program.
Originally expected to cost about $2.6 billion, the program appears to be running as much as $1 billion over budget, although sources said increased demands from the Pentagon are a major cause.
Advanced EHF is designed to replace the military's Milstar satellites, which were conceived during the Cold War to provide the world's most secure space-based communications system.
The new network would offer so much more bandwidth it would be like switching the military from dial-up telephone modems to DSL Internet service, one source familiar with the system said. This capability is coveted by the Bush administration, which hopes to increase the military's reliance on fast information networks and space-based technology.
The need for Advanced EHF became more urgent in 1999, when a Lockheed Martin-built Titan rocket failed to put an $800 million Milstar satellite into its proper orbit and left it unusable. Without that component of a four-satellite constellation, the Milstar system is unable to provide complete global coverage for military communications -- leaving gaps in certain far-flung areas similar to the gaps that sometimes plague cellular telephone service.
To compensate, the Pentagon decided to speed up the Advanced EHF program, which was open to competition among contractors with a projected first launch date of June 2006. The competing contractors -- Bethesda-based Lockheed Martin, TRW and a Hughes division that is now part of Boeing Co. -- told the military that they could move faster if they were allowed to join forces.
Working together, the companies said, they could move the first launch up to December 2004, so the Pentagon halted the competition and awarded them the job. The arrangement was not unprecedented; the three contractors were working together on the Milstar program.
The Department of Defense had planned to decide in April whether to move into design and construction of Advanced EHF, but by that time the contractors had disclosed that they were unlikely to meet the early launch date. Reports of the problems first surfaced in trade publications in February and were more fully reported yesterday by Bloomberg News.
In addition, uncertainty over the scope of the program -- such as whether the contract should include the computer terminals that various services would use to access the system -- led to cost estimates as much as $1 billion higher than predicted, sources said.
While the Pentagon theoretically could decide later this month to seek new bids, several experts said the military has little choice but to work things out. Keeping the three contractors on the program "really preserves the U.S. industrial base for building military satellites," said Marco Caceres, a space analyst with the Fairfax consulting firm the Teal Group.
What's more, the military should have been suspicious from the beginning about any promises to speed up the program, said John Pike of the nonprofit think tank GlobalSecurity.org. "The iron law of space projects is that they always cost more, take longer and do less than originally planned, period. That's just the way the world works," he said.
