DoD Awards $24.5M for Satellite Telecommunications to SpaceX, Highlighting Full and Open Competition
Contract Overview
Contract Amount: $24,482,510 ($24.5M)
Contractor: Space Exploration Technologies Corp.
Awarding Agency: Department of Defense
Start Date: 2024-05-14
End Date: 2026-05-13
Contract Duration: 729 days
Daily Burn Rate: $33.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: BEST EFFORT SUBSCRIPTION
Place of Performance
Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $24.5 million to SPACE EXPLORATION TECHNOLOGIES CORP. for work described as: BEST EFFORT SUBSCRIPTION Key points: 1. Significant contract value of $24.5 million for essential satellite telecommunications. 2. Awarded via full and open competition, suggesting a competitive bidding process. 3. Potential risk associated with reliance on a single vendor for a critical service. 4. Sector focus on Defense Information Systems Agency (DISA) and satellite technology.
Value Assessment
Rating: good
The contract value of $24.5 million for a 729-day period appears reasonable given the specialized nature of satellite telecommunications. Benchmarking against similar DISA contracts for satellite services would provide a more precise 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 method generally promotes competitive pricing and ensures the government receives the best value.
Taxpayer Impact: The competitive nature of the award suggests taxpayers are likely benefiting from a fair market price for these critical satellite telecommunications services.
Public Impact
Ensures continued communication capabilities for Department of Defense operations. Supports advanced satellite technology and infrastructure maintenance. Potential for future contract renewals or expansions based on performance.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Vendor Lock-in Risk
- Service Interruption Potential
- Cost Overruns
Positive Signals
- Proven Vendor Capability
- Competitive Pricing Achieved
- Strategic Technology Alignment
Sector Analysis
This contract falls within the Information Technology and Defense sectors, specifically focusing on satellite telecommunications. Spending in this area is critical for national security and global operations, with benchmarks varying widely based on technology and service level agreements.
Small Business Impact
There is no indication in the provided data that small businesses were involved in this specific contract award. Future analysis could explore subcontracting opportunities for small businesses within the satellite telecommunications sector.
Oversight & Accountability
The award process under full and open competition suggests a degree of oversight. However, ongoing monitoring of performance, service delivery, and adherence to contract terms by DISA is crucial for accountability.
Related Government Programs
- Satellite Telecommunications
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Dependence on a single provider for critical communications.
- Potential for price increases in future contract modifications or renewals.
- Vulnerability to geopolitical events impacting satellite operations.
- Technological obsolescence if not regularly updated.
Tags
satellite-telecommunications, department-of-defense, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $24.5 million to SPACE EXPLORATION TECHNOLOGIES CORP.. BEST EFFORT SUBSCRIPTION
Who is the contractor on this award?
The obligated recipient is SPACE EXPLORATION TECHNOLOGIES CORP..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $24.5 million.
What is the period of performance?
Start: 2024-05-14. End: 2026-05-13.
What is the specific nature of the satellite telecommunications services being procured, and how do they align with current DoD strategic objectives?
The data indicates 'Satellite Telecommunications' as the service. These services are likely crucial for secure, global communication, data transmission, and command and control operations supporting the DoD's strategic objectives. Further details on the specific bandwidth, coverage, and security protocols would clarify the alignment.
What are the key performance indicators (KPIs) for this contract, and how will SpaceX's performance be measured against them?
Key performance indicators are not explicitly detailed in the provided data. However, typical KPIs for such contracts include uptime/availability, latency, data throughput, security compliance, and response times for technical support. DISA will likely monitor these metrics closely to ensure service quality and contract adherence.
What is the potential long-term cost implication for the DoD if this vendor-contract relationship proves highly successful and is repeatedly renewed?
If the relationship proves successful and is repeatedly renewed, the long-term cost could be significant, potentially exceeding initial projections due to cumulative spending. However, a successful partnership might also lead to economies of scale, technological advancements, and more predictable budgeting, potentially offering better value over time compared to frequent re-competition.
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: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HC101322R0005
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 ROCKET RD, HAWTHORNE, CA, 90250
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: $30,679,960
Exercised Options: $24,482,510
Current Obligation: $24,482,510
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC101323D9000
IDV Type: IDC
Timeline
Start Date: 2024-05-14
Current End Date: 2026-05-13
Potential End Date: 2026-05-13 00:00:00
Last Modified: 2025-05-13
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