Coast Guard's $28.9M Fleet Broadband Upgrade contract awarded to Inmarsat Inc. for satellite telecommunications

Contract Overview

Contract Amount: $28,941,601 ($28.9M)

Contractor: Inmarsat Inc.

Awarding Agency: Department of Homeland Security

Start Date: 2009-09-30

End Date: 2012-11-01

Contract Duration: 1,128 days

Daily Burn Rate: $25.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FLEET BROADBAND UPGRADE SUPPLIES AND SERVICES TO PROVIDE THE USCG FLEET WITH BROADBAND TELECOMMUNICATIONS. AAP 57287

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20593

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $28.9 million to INMARSAT INC. for work described as: FLEET BROADBAND UPGRADE SUPPLIES AND SERVICES TO PROVIDE THE USCG FLEET WITH BROADBAND TELECOMMUNICATIONS. AAP 57287 Key points: 1. The contract aimed to equip the USCG fleet with essential broadband telecommunications services. 2. Awarded under full and open competition, suggesting a potentially competitive bidding process. 3. The duration of the contract was substantial, spanning over 1100 days. 4. The firm-fixed-price structure indicates that the contractor bore the risk of cost overruns. 5. The contract was a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar vehicle. 6. The total value of $28.9 million was distributed across multiple delivery orders. 7. The contract falls under the 'Satellite Telecommunications' product service code.

Value Assessment

Rating: fair

Benchmarking the value for this specific contract is challenging without knowing the exact services and data rates provided. However, the total value of $28.9 million over approximately three years for fleet-wide broadband telecommunications for a major agency like the Coast Guard appears within a reasonable range for such specialized services. Comparisons to similar contracts for naval or maritime broadband services would be necessary for a more precise assessment of value for money. The firm-fixed-price nature suggests a defined cost expectation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders (no) suggests a moderate level of competition for this requirement. While not a large number of bidders, it demonstrates that multiple companies were interested and capable of providing the satellite telecommunications services. This level of competition generally helps in achieving fair market pricing.

Taxpayer Impact: Taxpayers likely benefited from a more competitive pricing environment due to the full and open competition, potentially leading to cost savings compared to a sole-source award.

Public Impact

The primary beneficiaries are the U.S. Coast Guard personnel operating the fleet, who gained access to enhanced broadband telecommunications. The services delivered include crucial satellite-based broadband connectivity for operational and administrative purposes. The geographic impact is nationwide, covering all deployed USCG vessels and potentially shore-based command centers. Workforce implications include enabling better communication for crew welfare, operational coordination, and data transfer for mission-critical systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the technology deployed is proprietary and difficult to transition away from.
Dependence on a single provider for critical communication infrastructure could pose risks during service disruptions or geopolitical events.
Ensuring consistent service quality and coverage across diverse operational environments for the entire fleet can be challenging.

Positive Signals

Awarded under full and open competition, indicating a structured procurement process.
Firm-fixed-price contract shifts cost overrun risk to the contractor.
The contract supports a critical national security and maritime safety mission for the USCG.

Sector Analysis

This contract falls within the broader telecommunications sector, specifically focusing on satellite-based broadband services. The market for maritime satellite communications is specialized, with a few key global providers dominating. The U.S. government, particularly defense and homeland security agencies, represents a significant customer base for these services. Spending in this area is driven by the need for reliable connectivity in remote or mobile operational environments where terrestrial networks are unavailable or insufficient. Comparable spending benchmarks would involve analyzing other government contracts for similar satellite communication solutions for naval fleets or remote operations.

Small Business Impact

There is no indication that this contract included a small business set-aside. The nature of global satellite telecommunications services often involves large, established international providers. Subcontracting opportunities for small businesses might exist in areas such as installation, maintenance, or integration of equipment, but the primary service provision is likely handled by the prime contractor. The impact on the small business ecosystem for this specific contract appears minimal, as it was not designed to directly benefit small businesses through set-asides.

Oversight & Accountability

Oversight for this contract would typically be managed by the U.S. Coast Guard contracting officers and program managers. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is generally provided through contract award databases like FPDS-NG. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

USCG Communication Systems Modernization
Department of Homeland Security Telecommunications Contracts
DoD Satellite Communications Programs
Maritime Broadband Services

Risk Flags

Potential for vendor lock-in
Dependence on single provider for critical infrastructure
Service disruption risks

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $28.9 million to INMARSAT INC.. FLEET BROADBAND UPGRADE SUPPLIES AND SERVICES TO PROVIDE THE USCG FLEET WITH BROADBAND TELECOMMUNICATIONS. AAP 57287

Who is the contractor on this award?

The obligated recipient is INMARSAT INC..

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Coast Guard).

What is the total obligated amount?

The obligated amount is $28.9 million.

What is the period of performance?

Start: 2009-09-30. End: 2012-11-01.

What specific performance metrics were included in the contract to ensure service quality and reliability for the USCG fleet?

The provided data does not detail the specific performance metrics or service level agreements (SLAs) established within the contract. Typically, such contracts would include metrics related to bandwidth availability, latency, jitter, uptime percentages, and potentially data throughput guarantees. The Coast Guard would have defined these based on operational requirements for voice, data, and video communications across its diverse fleet. Failure to meet these metrics would likely trigger contractual remedies, such as service credits or penalties, as stipulated in the contract's terms and conditions. A thorough review of the contract document itself would be necessary to ascertain these specific performance benchmarks.

How does the per-unit cost of this contract compare to similar satellite broadband services provided to other maritime agencies or naval forces?

Direct per-unit cost comparison is difficult without granular data on the services rendered (e.g., bandwidth per vessel, data volume, service tier). However, the total contract value of $28.9 million over approximately three years for fleet-wide broadband suggests an average annual spend of roughly $9.6 million. For context, similar large-scale maritime satellite communication contracts for naval fleets can range from tens to hundreds of millions of dollars annually, depending on the size of the fleet, the required bandwidth, and the geographic coverage. Inmarsat is a major global provider, and their pricing is generally competitive within the high-end maritime satellite market. A detailed benchmark would require comparing specific bandwidth packages and service level agreements against publicly available contract data for comparable government entities.

What was the historical spending pattern for fleet broadband services by the U.S. Coast Guard prior to this contract?

Historical spending data prior to this $28.9 million contract (2009-2012) for USCG fleet broadband services is not detailed in the provided summary. However, it is reasonable to assume that the Coast Guard has consistently required robust communication capabilities for its operations. Prior to the widespread adoption of modern broadband satellite services, spending might have been on older satellite technologies or more limited terrestrial/radio-based systems. The transition to this contract likely represented an upgrade in capability and potentially a shift in spending towards more integrated, higher-bandwidth solutions. Analyzing historical FPDS data for the USCG under relevant Product Service Codes (like 517410 - Satellite Telecommunications) would reveal trends in spending and contract types over preceding years.

What are the potential risks associated with relying on Inmarsat Inc. for critical fleet communications, considering their market position?

Relying on Inmarsat Inc., a major global provider, for critical fleet communications presents several potential risks. Firstly, there's the risk of vendor lock-in, where the specific technology and infrastructure deployed might make switching providers difficult or costly in the future. Secondly, dependence on a single entity for essential connectivity can be a vulnerability; service disruptions, whether due to technical issues, cyberattacks, or geopolitical factors affecting Inmarsat's operations or satellite coverage, could significantly impact USCG missions. Thirdly, while competition existed for this award, Inmarsat operates in a market with limited major players, which could influence future pricing negotiations or service evolution. The USCG would mitigate these risks through robust contract management, contingency planning, and potentially exploring alternative communication technologies or providers for redundancy.

How did the number of bidders (3) influence the final pricing and terms of this contract compared to a scenario with more or fewer bidders?

With three bidders, the competition for this contract was likely moderate. A higher number of bidders (e.g., 5+) typically exerts stronger downward pressure on pricing as companies compete more aggressively to win the contract. Conversely, fewer bidders, especially if one is a clear frontrunner or if the market is highly concentrated, might lead to less competitive pricing. Three bidders suggest that Inmarsat Inc. likely faced meaningful competition, which should have contributed to fair market pricing. However, it's possible that the specialized nature of satellite telecommunications limits the number of capable providers, meaning three bidders might represent a significant portion of the viable market. The final price and terms would reflect the specific proposals submitted and the negotiation dynamics among these three entities.

Industry Classification

NAICS: Information › Satellite Telecommunications › Satellite Telecommunications

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: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Inmarsat Solutions (US) Inc.

Address: 6550 ROCK SPRING DR STE 650, BETHESDA, MD, 20817

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,886,821

Exercised Options: $28,941,601

Current Obligation: $28,941,601

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS00T07NSD0033

IDV Type: IDC

Timeline