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Home News Archive AEHF … WTF?

AEHF … WTF?

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On August 17, 2009 DefenseNews.com published an article (authored by William Matthews) that had such an eye-catching lead-in, we had to see for ourselves whether or not it was for real.  The article started as follows:

 

In April, U.S. Defense Secretary Robert Gates terminated TSAT, an ambitious communications satellite program that was over budget, behind schedule and plagued by technical problems.  In its place, he substituted AEHF - the Advanced Extremely High Frequency satellite - a less ambitious communications satellite program that also is over budget, behind schedule and plagued by technical problems. … TSAT, the Transformational Satellite communications system, cost U.S. taxpayers $2.5 billion before Gates pulled its plug. AEHF was expected to cost $5.6 billion in 2001 when the program was getting under way, but today the price tag is more than $10 billion for fewer satellites, according to the Government Accountability Office (GAO).  TSAT was at least four years behind schedule. Launch of the first satellite had been pushed back to 2019.  The first AEHF was supposed to be launched in 2008, then 2009, and now Lockheed is aiming for late 2010.

 

Now that’s how to write a story!  So what’s the story behind the story?  Let’s look.SPAC Satellite AEHF Concept

 

The Advanced Extremely High Frequency (AEHF) satellite is designed to replace the 20 year-old MILSTAR military satellite communication system by providing “near-worldwide, secure, survivable satellite communications to support strategic and tactical forces of the United States and its international partners during all levels of conflict,” according to globalsecurity.org.  The website notes that the AEHF system will provide 12 times the data throughput of the MILSTAR system, so that “for every one link of the old Milstar, the Air Force now has 12 operating at four times the speed.”

 

After the loss of MILSTAR Flight 3 in April, 1999, the Department of Defense (DOD) created the AEHF program consisting of a consortium of Lockheed Martin, Hughes Aircraft Co., and TRW (now Northrop Grumman).  GlobalSecurity.org reports that –

 

On 16 November 2001 the U.S. Air Force awarded a $2.698 billion System Development and Demonstration [SDD] contract for the Advanced Extremely High Frequency satellite program to a team comprised of Lockheed Martin Corp., Lockheed Martin Missiles and Space, Sunnyvale, Calif. and TRW Inc., Space and Electronics, Redondo Beach, Calif. The contractor team is led by Lockheed Martin as the prime integrator and provider of the Spacecraft Bus and ground command and control segments with TRW providing the satellite payload. The contract will culminate in the delivery of two AEHF satellites and the ground command and control system. The first of two satellites under this contract was scheduled for launch in 2006.

 

Since early system definition studies in 1999, the AEHF program has gone through a series of design changes.  For example, GlobalSecurity.org reports that on May 18, 2004 Lockheed Martin Corp., Space Systems Co. and Northrop Grumman Space Technology, were (together) awarded a $149 million contract modification which incorporated within-scope changes resulting from a revision to the AEHF KI-54 Cryptographic Interface Control Document (ICD). The KI-54 ICD modification required to AEHF team to redesign the Host Accessory Logic Application Specific Integrated Circuit (HAL ASIC) in the AEHF communication payload. This effort also led to a four months program extension.  In December 2004, the U.S. Air Force reported that the AEHF program had experienced unavoidable delays and cost growth because of delayed delivery of signal-encryption products, which had resulted in a delay of command and control terminals. As a result of these schedule impacts, the AEHF program was delayed by 12 months.  Additional reports noted that the program incurred cost growth from unplanned payload component testing and replacement of existing critical electronic components that were disqualified for space flight. The cost and schedule impacts were expected to increase the overall cost of the AEHF program by roughly 20 percent.

 

The number of planned AEHF satellites has fluctuated over time as well.  The original SDD contract called for a “pathfinder” satellite followed by four, higher-capability, satellites, for a total constellation of five.  In reality, the number of AEHF satellites would depend on the progress of another satellite program, the “transformational” communication satellite, or TSAT, program.  In 2002 the Air Force decided not to acquire two AEHF satellites.  In October 2004 the Air Force decided not to acquire the fourth AEHF satellite in order to proceed more quickly with the TSAT program.  The TSAT program was terminated by Secretary of Defense Gates in October 2008, after incurring approximately $2.5 billion in costs.  (DefenseNews.com reported that the TSAT program was “at least four years behind schedule” and that “launch of the first satellite had been pushed back to 2019” at the time of program termination.)  In 2005 a third satellite was added back to the program, at a reported cost of $491 million.  After the TSAT program termination a fourth AEHF satellite was added back to the program resulting in additional cost and schedule impacts that triggered a “Nunn-McCurdy” breach and mandatory Pentagon program review.  According to a September 2008 article in Aviation Week & Space Technology, “The fourth satellite accounts for four-fifths of the FY '09 cost increase in the program. The spacecraft's high price is due to the expense associated with restarting Lockheed Martin's production line.”

 

Impacts to the program’s cost and schedule, as well as the impacts from the fluctuating number of satellites, compelled the contractors to initiate a program rebaseline” or “replan” that resulted, in April 2006, in an $454.9 million contract modification to compensate the contractors for the changes as well as the delay of the first AEHF launch date from 2006 to April 2008.  Current reports indicate a planned launch date of 2010 with a total program cost of $9.2 billion.

 

So to sum up, the DefenseNews.com article had its facts correct, but seems to have taken them out of context.  Like many high-tech developmental programs, the AEHF program has been the victim of Pentagon budget wars.  While the program undoubtedly suffered from many of the pains associated with trying put a highly secure, classified payload into space, it also suffered from a lack of firm strategic leadership from the Pentagon.  The fluctuations in the number of satellites and budgetary uncertainty clearly impacted the contractors at least as much (if not more) than the technical challenges.  While it might serve as a good example of out-of-control defense programs, it might also serve as a good example of the impacts of failed leadership.  It seems that the DefenseNews.com article missed the mark, choosing to take cheap shots rather than dig for the truth.

 

Newsflash

Effective January 1, 2019, Nick Sanders has been named as Editor of two reference books published by LexisNexis. The first book is Matthew Bender’s Accounting for Government Contracts: The Federal Acquisition Regulation. The second book is Matthew Bender’s Accounting for Government Contracts: The Cost Accounting Standards. Nick replaces Darrell Oyer, who has edited those books for many years.