DoD's $29.2M contract for 72 MHZ KU-BAND services awarded to ARTEL LLC shows fair value and strong competition

Contract Overview

Contract Amount: $29,212,899 ($29.2M)

Contractor: Artel LLC

Awarding Agency: Department of Defense

Start Date: 2011-02-11

End Date: 2016-02-15

Contract Duration: 1,830 days

Daily Burn Rate: $16.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: 72 MHZ KU-BAND

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $29.2 million to ARTEL LLC for work described as: 72 MHZ KU-BAND Key points: 1. Contract value represents a reasonable investment for specialized satellite communication services. 2. Full and open competition suggests a healthy market for these services. 3. Fixed-price contract type mitigates cost overrun risks. 4. Performance period of 5 years provides stability for service delivery. 5. Awarded by Defense Information Systems Agency, indicating critical defense communication needs. 6. Virginia location suggests a concentration of defense-related IT infrastructure.

Value Assessment

Rating: good

The contract's total value of $29.2 million over five years appears reasonable for specialized satellite communication services. Benchmarking against similar contracts is challenging without more granular data on service specifics (e.g., bandwidth, uptime guarantees, geographic coverage). However, the firm fixed-price structure suggests that the government secured predictable costs, which is a positive indicator of value. The absence of significant contract modifications or overruns, if applicable, would further support a 'good' value assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. This process typically leads to a more competitive bidding environment, encouraging vendors to offer their best pricing and technical solutions. The fact that a contract of this size and duration was fully competed suggests a robust market for the required KU-band satellite services.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces, ensuring the government receives the best possible value for its investment.

Public Impact

Provides critical satellite communication services to the Department of Defense. Supports military operations and command and control capabilities. Likely impacts personnel stationed in areas with limited terrestrial communication infrastructure. Contributes to the operational readiness of defense forces.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded under full and open competition, indicating a competitive market.
Firm fixed-price contract type helps control costs.
Long-term contract (5 years) provides stability for critical services.
Awarded by a major defense agency (DISA) for essential communication needs.

Sector Analysis

This contract falls within the broader telecommunications and IT services sector, specifically focusing on satellite communications. The market for satellite bandwidth and related services is substantial, driven by both commercial and government demand. Defense applications often require highly reliable, secure, and geographically diverse communication solutions, which can command premium pricing. This contract likely represents a portion of the DoD's overall investment in maintaining robust and resilient communication networks.

Small Business Impact

The provided data does not indicate any small business set-aside provisions for this contract. As a full and open competition, it is possible that small businesses could have participated, but there is no explicit indication of subcontracting goals or specific efforts to engage small businesses in the award details. Further analysis would be needed to determine if small businesses were involved as subcontractors.

Oversight & Accountability

The contract was awarded by the Defense Information Systems Agency (DISA), which has established oversight mechanisms for its procurements. As a firm fixed-price contract, financial oversight would focus on ensuring adherence to the agreed-upon price and scope. Performance monitoring would be crucial to ensure the delivery of the specified 72 MHZ KU-BAND services. Transparency is generally maintained through contract award databases, though specific performance metrics may not be publicly detailed.

Related Government Programs

Defense Satellite Communications
Tactical Communications
Network Infrastructure Services
Information Technology Services

Risk Flags

Potential for vendor lock-in over the contract duration.
Reliance on satellite technology can be susceptible to space weather or orbital debris.
Need for continuous monitoring of service performance against SLAs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.2 million to ARTEL LLC. 72 MHZ KU-BAND

Who is the contractor on this award?

The obligated recipient is ARTEL LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $29.2 million.

What is the period of performance?

Start: 2011-02-11. End: 2016-02-15.

What is the historical spending trend for KU-band satellite services by the Department of Defense?

Analyzing the historical spending trend for KU-band satellite services by the Department of Defense requires access to comprehensive historical contract data. While this specific contract awarded $29.2 million, understanding the broader trend involves examining spending across multiple years and various defense agencies. Factors influencing these trends include evolving military operational requirements, technological advancements in satellite communication, geopolitical events necessitating enhanced communication capabilities, and budget allocations. For instance, periods of increased global military engagement might correlate with higher spending on satellite communications to support deployed forces. Conversely, shifts towards terrestrial or alternative communication methods could lead to fluctuations. A detailed analysis would involve identifying all relevant contracts, aggregating their values, and looking for patterns, growth, or decline over time, potentially segmented by service type or geographic region.

How does the per-unit cost of this contract compare to other similar KU-band satellite service contracts awarded by the DoD?

Directly comparing the per-unit cost of this $29.2 million contract for 72 MHZ KU-BAND services to other similar contracts is challenging without more granular data. 'Per-unit cost' could be interpreted in several ways: cost per MHz, cost per gigabyte, cost per site, or cost per user. The specific service level agreements (SLAs), geographic coverage, uptime guarantees, and duration of service significantly influence pricing. This contract, awarded to ARTEL LLC, has a firm fixed price over five years. To benchmark effectively, one would need to identify comparable contracts from the DoD or other federal agencies that specify similar bandwidth (72 MHZ KU-BAND), service duration, and performance requirements. Analyzing the price per MHz-month or similar metrics across a range of contracts would reveal whether ARTEL LLC's pricing is competitive within the market for these specialized services.

What are the key performance indicators (KPIs) used to measure the success of this contract?

The key performance indicators (KPIs) for this contract would likely focus on ensuring the reliable and effective delivery of the specified 72 MHZ KU-BAND satellite services. While not explicitly detailed in the provided data, typical KPIs for such a contract would include: 1. **Availability/Uptime:** Measuring the percentage of time the satellite link is operational and available for use, often with specific targets (e.g., 99.9% uptime). 2. **Latency:** Monitoring the delay in data transmission, crucial for real-time operations. 3. **Throughput/Bandwidth:** Verifying that the contracted 72 MHZ bandwidth is consistently delivered and usable. 4. **Signal Quality:** Assessing the strength and clarity of the satellite signal to ensure data integrity. 5. **Service Restoration Time:** The time it takes to restore service after an outage. 6. **Customer Service/Support:** Responsiveness and effectiveness of technical support provided by ARTEL LLC. These KPIs are essential for the Defense Information Systems Agency (DISA) to ensure the contractor meets its contractual obligations and that the services adequately support DoD missions.

What is ARTEL LLC's track record with government contracts, particularly in satellite communications?

ARTEL LLC has a significant track record of performing government contracts, particularly within the defense and telecommunications sectors. They have been a provider of satellite communications and network services to various U.S. government agencies, including the Department of Defense (DoD), for many years. Their experience often involves providing secure, high-bandwidth satellite solutions for military operations, intelligence gathering, and other critical government functions. Analyzing their past performance on similar contracts would involve reviewing contract databases for awards, task orders, and any reported performance issues or commendations. A positive performance history, especially on large, complex contracts like this one, suggests a lower risk profile and a higher likelihood of successful contract execution. Their longevity and continued awards indicate a level of trust and capability recognized by government contracting officers.

What are the potential risks associated with relying on a single vendor for this critical communication service over a five-year period?

While this contract was awarded through full and open competition, the five-year duration with ARTEL LLC for 72 MHZ KU-BAND services introduces potential risks. A primary risk is vendor lock-in, where the government becomes heavily reliant on ARTEL's infrastructure and expertise, making it difficult or costly to switch providers if performance degrades or market alternatives become significantly better. There's also the risk of price increases in future contract renewals or modifications if competition is less robust then. Operational risks include potential service disruptions due to ARTEL's internal issues (e.g., technical failures, financial instability, or changes in their satellite fleet). Furthermore, if ARTEL's technology becomes outdated compared to emerging satellite communication solutions, the DoD might miss out on more advanced capabilities. Mitigation strategies often involve robust performance monitoring, clear contract terms, and contingency planning.

How does this contract align with the DoD's broader strategy for resilient and secure communication networks?

This contract for 72 MHZ KU-BAND services awarded to ARTEL LLC aligns with the DoD's ongoing strategy to maintain resilient, secure, and globally accessible communication networks. Satellite communications remain a critical component of this strategy, especially for supporting operations in remote areas, during contested environments where terrestrial infrastructure may be compromised, or for providing redundancy. The DoD emphasizes multi-path communications, integrating various technologies including satellite, to ensure connectivity. By securing dedicated bandwidth through a competitive process, the DoD enhances its ability to command and control forces, transmit intelligence, and maintain situational awareness. The firm fixed-price nature also contributes to predictable budgeting for these essential services, supporting the DoD's need for reliable resource allocation in its pursuit of information dominance.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13665 DULLES TECHNOLOGY DR STE 300, HERNDON, VA, 20171

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,212,899

Exercised Options: $29,212,899

Current Obligation: $29,212,899

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F5151H

IDV Type: FSS

Timeline