Viasat Inc. awarded $30M for satellite telecommunications, raising questions about competition and value
Contract Overview
Contract Amount: $30,039,822 ($30.0M)
Contractor: Viasat Inc
Awarding Agency: Department of Defense
Start Date: 2022-09-29
End Date: 2026-06-28
Contract Duration: 1,368 days
Daily Burn Rate: $22.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: VGNET KU PLUS-8 SIMOPS
Place of Performance
Location: TUCSON, PIMA County, ARIZONA, 85707
State: Arizona Government Spending
Plain-Language Summary
Department of Defense obligated $30.0 million to VIASAT INC for work described as: VGNET KU PLUS-8 SIMOPS Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Significant duration of the contract (over 3 years) suggests a long-term need for these services. 3. The contract is for satellite telecommunications, a critical but often expensive service area. 4. No indication of small business participation, suggesting larger prime contractors are involved. 5. The firm-fixed-price structure aims to control costs, but the lack of competition is a concern.
Value Assessment
Rating: questionable
Benchmarking the value of this sole-source contract is challenging due to the lack of competitive bids. While the firm-fixed-price structure provides some cost certainty, the absence of competition means there's no market validation of the pricing. Without comparable contracts or detailed cost breakdowns, it's difficult to definitively assess if the $30 million represents a fair market price. Further analysis would be needed to understand the specific services and their necessity to determine if the value proposition is strong.
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 is typically used when only one vendor can provide the required goods or services, or in urgent situations. The lack of competition means that Viasat Inc. was the only bidder, which can lead to higher prices and reduced innovation compared to a fully competed contract. The rationale for the sole-source award needs to be thoroughly documented and justified.
Taxpayer Impact: Taxpayers may be paying a premium for these services due to the absence of competitive pressure. Without multiple bids, there is less assurance that the government secured the best possible price and value.
Public Impact
The Department of Defense benefits from critical satellite telecommunications services provided by Viasat Inc. These services are essential for maintaining communication capabilities, likely supporting military operations and personnel. The contract's duration suggests ongoing support for a sustained operational requirement. The geographic impact is likely broad, given the nature of satellite communications, potentially supporting global operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competitive pricing and value assessment.
- Lack of transparency in the justification for sole-source procurement.
- Long contract duration without clear performance metrics or re-competition points.
- Potential for cost overruns if pricing is not rigorously managed post-award.
Positive Signals
- Firm-fixed-price contract type provides cost certainty for the government.
- Viasat Inc. is a known provider of satellite communications, suggesting established capability.
- Contract addresses a critical need for telecommunications infrastructure.
Sector Analysis
Satellite telecommunications is a vital sector within the broader IT and Defense industries, providing essential connectivity for government and commercial entities. The market is characterized by high barriers to entry due to significant infrastructure investment and technological complexity. This contract with Viasat Inc. for satellite telecommunications services fits within this sector, addressing a specific need for robust and reliable communication solutions, likely for defense applications. Comparable spending in this area can vary widely based on bandwidth, coverage, and service level agreements.
Small Business Impact
There is no indication that this contract included a small business set-aside. Given the nature of satellite telecommunications and the sole-source award to a large prime contractor like Viasat Inc., it is unlikely that small businesses were directly involved as prime contractors. Subcontracting opportunities for small businesses may exist, but this would depend on Viasat Inc.'s internal subcontracting plans and is not explicitly detailed in the provided data. The impact on the small business ecosystem is likely minimal for this specific award.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Defense's contracting and program management offices, with potential involvement from the Defense Contract Management Agency (DCMA). Inspector General (IG) oversight is also a standard mechanism for investigating fraud, waste, and abuse. Transparency regarding the sole-source justification and performance monitoring would be key to effective oversight. The contract's long duration necessitates robust performance management to ensure continued value.
Related Government Programs
- Defense Information Systems Agency (DISA) contracts
- Satellite Communications Services
- Department of Defense IT Procurement
- Network Infrastructure Contracts
Risk Flags
- Sole-source award raises concerns about competition and potential overpricing.
- Lack of transparency regarding the justification for sole-source procurement.
- Long contract duration without clear performance benchmarks or re-competition.
Tags
it, defense, satellite-telecommunications, definitive-contract, firm-fixed-price, sole-source, viasat-inc, department-of-defense, defense-information-systems-agency, arizona, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $30.0 million to VIASAT INC. VGNET KU PLUS-8 SIMOPS
Who is the contractor on this award?
The obligated recipient is VIASAT INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $30.0 million.
What is the period of performance?
Start: 2022-09-29. End: 2026-06-28.
What is the specific justification for awarding this contract on a sole-source basis to Viasat Inc.?
The provided data indicates the contract was awarded under a 'NOT COMPETED' (CT: NOT COMPETED) status, signifying a sole-source procurement. The specific justification for this sole-source award is not detailed in the provided data snippet. Typically, sole-source contracts are justified when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. For satellite telecommunications, this could be due to unique orbital slot access, proprietary technology, or specific network integration requirements that only Viasat Inc. can fulfill. A thorough review of the contract file and associated documentation would be necessary to ascertain the official justification provided by the Department of Defense and the Defense Information Systems Agency.
How does the $30 million contract value compare to similar satellite telecommunications contracts awarded by the DoD?
Direct comparison of the $30 million contract value to similar satellite telecommunications contracts is difficult without more specific details on the scope of services, duration, and technical requirements. However, satellite communication services are generally high-cost due to infrastructure, bandwidth, and global coverage demands. Contracts for similar services can range from a few million to hundreds of millions of dollars, depending on the scale and complexity. Given this is a definitive contract with a nearly 4-year duration, $30 million ($7.5M/year) appears to be within a plausible range for specialized government satellite services. However, the lack of competition prevents a definitive assessment of whether this represents optimal value for money compared to what could be achieved through a competitive process.
What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?
The provided data snippet does not include specific details regarding the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. For satellite telecommunications, typical KPIs and SLAs would likely focus on aspects such as network availability (uptime), latency, bandwidth throughput, data integrity, geographic coverage reliability, and response times for technical support or service restoration. The firm-fixed-price nature of the contract suggests that these performance metrics are crucial for ensuring the contractor, Viasat Inc., meets the government's requirements. The Defense Information Systems Agency (DISA) would be responsible for monitoring these metrics to ensure contract compliance and service delivery.
What is Viasat Inc.'s track record with the Department of Defense, particularly in satellite telecommunications?
Viasat Inc. has a significant track record as a provider of satellite broadband services and secure networking systems, including for government and defense applications. They are known for their high-capacity satellite networks, such as ViaSat-1 and ViaSat-2, which offer substantial bandwidth. The Department of Defense has previously contracted with Viasat for various communication solutions, including tactical satellite services and secure connectivity. Their experience in delivering robust, high-speed satellite internet and secure communications makes them a capable provider for defense needs. However, the specific performance history on prior DoD contracts, especially regarding on-time delivery, budget adherence, and technical performance, would require a deeper dive into contract databases and performance reports.
What is the historical spending trend for satellite telecommunications services by the Defense Information Systems Agency (DISA)?
Historical spending trends for satellite telecommunications services by the Defense Information Systems Agency (DISA) generally show a consistent and significant investment. DISA is responsible for providing enterprise IT and communications services to the DoD, and satellite communications are a critical component of this mission, especially for reaching remote or deployed forces. While specific annual figures fluctuate based on evolving requirements, technological advancements, and the number and size of awarded contracts, DISA's overall budget allocation for telecommunications, including satellite services, typically runs into the billions of dollars annually. Analyzing past DISA contract awards for satellite services would reveal patterns in vendor selection, contract types, and average award values, providing context for the current $30 million award.
Industry Classification
NAICS: Information › Satellite Telecommunications › Satellite Telecommunications
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HC101322R0004
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6155 EL CAMINO REAL, CARLSBAD, CA, 92009
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $56,113,141
Exercised Options: $30,039,822
Current Obligation: $30,039,822
Subaward Activity
Number of Subawards: 1
Total Subaward Amount: $100,827
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Timeline
Start Date: 2022-09-29
Current End Date: 2026-06-28
Potential End Date: 2027-06-28 00:00:00
Last Modified: 2025-12-10
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