DoD Ponders ‘Should-cost’ Estimates for Satellite Buys

1 min read

High-minded Defense Department “should-cost” acquisition estimates are running square into the brave new world of satellites, in what National Defense magazine called an “outer space imponderable.”

Undersecretary of Defense for Acquisition, Technology and Logistics Ashton Carter has indicated DoD shells out too much for space systems and even further back than that Defense Secretary Robert M. Gates had canceled the TSAT — Transformational Satellite — program because of runaway costs.

Increasingly, as National Defense reports is known as EASE, short for evolutionary acquisition for space efficiency, which basically translates into block buys for satellite orders.

In February, The Wall Street Journal reported Gates and other department leaders posited that by buying satellites and rockets in higher volumes, rather than one at a time (as DoD has historically done), the department would save money over the long haul and halt the inefficient boom-and-bust cycles that often plague defense space companies.

But now, the question is determining how much the Pentagon should spend on satellite systems as, more and more, it looks to commercial solutions.

“We are working with Congress” on questions of funding, Erin Conaton, undersecretary of the Air Force said. “We have to get at the cost basis of these programs,” she said. “Our industry partners will be asked for better pricing.”

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1 Comment

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