DoD Awards $71.5M Firm Fixed Price Contract to Lockheed Martin for Evolved Strategic Satellite Communication Prototype
Contract Overview
Contract Amount: $71,541,156 ($71.5M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2020-11-09
End Date: 2022-12-15
Contract Duration: 766 days
Daily Burn Rate: $93.4K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: EVOLVED STRATEGIC SATELLITE COMMUNICATION PROTOTYPE
Place of Performance
Location: SUNNYVALE, SANTA CLARA County, CALIFORNIA, 94089
Plain-Language Summary
Department of Defense obligated $71.5 million to LOCKHEED MARTIN CORP for work described as: EVOLVED STRATEGIC SATELLITE COMMUNICATION PROTOTYPE Key points: 1. Significant investment in advanced satellite communication technology. 2. Sole-source award to Lockheed Martin raises questions about competition. 3. Potential risks associated with prototype development and long-term sustainment. 4. Focus on strategic communication highlights national security implications. 5. Contract duration of 766 days indicates a substantial development effort.
Value Assessment
Rating: questionable
The contract value of $71.5M for a prototype is substantial. Benchmarking against similar satellite communication prototype contracts is difficult without more specific details on the technology and scope. The firm fixed price structure aims to control costs, but the lack of competition may have led to a higher price than if it were competed.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This approach can be justified for unique capabilities or existing sole-source systems, but it limits price discovery and potentially increases costs for taxpayers. The absence of competition is a significant factor in assessing value.
Taxpayer Impact: The sole-source nature of this award means taxpayers may not have received the best possible price due to the lack of competitive bidding.
Public Impact
Enhances national security through advanced satellite communication capabilities. Supports the development of next-generation military communication systems. Potential for technological advancements with broad applications beyond defense. Investment in a key defense contractor's capabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Prototype development carries inherent technical and schedule risks.
- High contract value requires close monitoring.
- Lack of small business participation noted.
Positive Signals
- Addresses critical strategic communication needs.
- Firm fixed price contract provides cost certainty.
- Leverages established contractor capabilities.
Sector Analysis
This contract falls within the Information Technology and Defense sectors, specifically focusing on advanced wireless communication equipment manufacturing for satellite systems. Spending in this area is critical for maintaining technological superiority and secure communication networks for national defense. Benchmarks for similar strategic satellite communication prototypes are highly variable due to the specialized nature of the technology.
Small Business Impact
The data indicates that small business participation was not a factor in this contract award (ss: false, sb: false). This is common for large, sole-source, high-technology development contracts where specific expertise resides with a prime contractor. Efforts to include small businesses in subcontracting roles would be beneficial.
Oversight & Accountability
The Department of the Air Force is responsible for oversight of this contract. Given the sole-source nature and the prototype development, robust oversight is crucial to ensure milestones are met, costs are controlled, and the final product meets strategic requirements. Accountability for performance and adherence to the firm fixed price will be key.
Related Government Programs
- Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competitive pricing.
- Prototype development carries inherent technical risks.
- Potential for cost overruns despite fixed price.
- Long-term sustainment costs not detailed.
- Lack of small business participation.
Tags
radio-and-television-broadcasting-and-wi, department-of-defense, ca, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $71.5 million to LOCKHEED MARTIN CORP. EVOLVED STRATEGIC SATELLITE COMMUNICATION PROTOTYPE
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $71.5 million.
What is the period of performance?
Start: 2020-11-09. End: 2022-12-15.
What specific technological advancements does this prototype aim to achieve, and how do they compare to current capabilities?
The 'Evolved Strategic Satellite Communication Prototype' likely aims to enhance bandwidth, security, and resilience of military satellite communications. This could involve advancements in areas like quantum encryption, multi-orbit constellation integration, or software-defined networking for satellites. A comparison to current capabilities would reveal the leap in performance, potentially offering faster, more secure, and more adaptable communication channels essential for modern warfare and global operations.
What is the justification for the sole-source award, and what steps were taken to ensure fair pricing without competition?
Sole-source awards are typically justified when a unique capability is required, only one vendor can provide it, or there's a critical need for urgency and leveraging existing systems. For this contract, the justification likely stems from Lockheed Martin's established role in strategic satellite systems. However, without competition, ensuring fair pricing relies heavily on robust government negotiation, independent cost estimates, and potentially benchmarking against similar, albeit scarce, sole-source procurements to validate the price.
What are the key performance indicators (KPIs) for this prototype, and how will their successful achievement be measured to ensure effectiveness?
Key performance indicators for this prototype would likely include metrics related to data throughput, latency, signal-to-noise ratio, encryption strength, system uptime, and resilience to jamming or interference. Success will be measured through rigorous testing and validation phases outlined in the contract, potentially involving simulated operational environments and independent verification by government test teams. Meeting these defined technical benchmarks will determine the prototype's effectiveness and readiness for potential future production.
Industry Classification
NAICS: Manufacturing › Communications Equipment Manufacturing › Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1111 LOCKHEED MARTIN WAY, SUNNYVALE, CA, 94089
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $71,541,156
Exercised Options: $71,541,156
Current Obligation: $71,541,156
Subaward Activity
Number of Subawards: 19
Total Subaward Amount: $17,539,341
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2020-11-09
Current End Date: 2022-12-15
Potential End Date: 2022-12-15 00:00:00
Last Modified: 2023-01-05
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