Space Acquisitions: DOD Needs Additional Knowledge as it Embarks 
on a New Approach for Transformational Satellite Communications  
System (24-MAY-06, GAO-06-537). 				 
                                                                 
The Department of Defense (DOD) wants to create a networked force
where soldiers and systems are able to operate together 	 
seamlessly. To help facilitate this transformation, DOD began the
Transformational Satellite Communications System (TSAT) program  
in January 2004. We reported in 2003 that TSAT was about to begin
without sufficiently mature technology. In this report, at your  
request, we followed up with an assessment of (1) how the TSAT	 
program is progressing, and (2) whether the program is using an  
acquisition approach that will provide the knowledge needed to	 
enter product development.					 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-537 					        
    ACCNO:   A54686						        
  TITLE:     Space Acquisitions: DOD Needs Additional Knowledge as it 
Embarks on a New Approach for Transformational Satellite	 
Communications System						 
     DATE:   05/24/2006 
  SUBJECT:   Communication satellites				 
	     Defense procurement				 
	     Military satellites				 
	     Procurement practices				 
	     Program evaluation 				 
	     Program management 				 
	     Schedule slippages 				 
	     Cost estimates					 
	     DOD Transformational Satellite			 
	     Communications System Program			 
                                                                 

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GAO-06-537

                 United States Government Accountability Office

Report to Congressional Committees

GAO

May 2006

SPACE ACQUISITIONS

       DOD Needs Additional Knowledge as it Embarks on a New Approach for
                Transformational Satellite Communications System

GAO-06-537

SPACE ACQUISITIONS

DOD Needs Additional Knowledge as it Embarks on a New Approach for
Transformational Satellite Communications System

  What GAO Found

The Department of Defense is not meeting original cost, schedule, and
performance goals established for the TSAT program. When the program was
initiated in 2004, DOD estimated TSAT's total acquisition cost to be $15.5
billion and that it would launch the first satellite in April 2011. TSAT's
current formal cost estimate is nearly $16 billion and the initial launch
date has slipped to September 2014-a delay of over three years.
Furthermore, while the performance goal of the full five-satellite
constellation has not changed, the initial delivery of capability will be
less than what DOD originally planned. After DOD established initial goals
for TSAT, Congress twice reduced the program's funding due to concerns
about technology maturity and the aggressiveness of the acquisition
schedule. DOD developed the initial goals before it had sufficient
knowledge about critical TSAT technologies.

DOD is taking positive steps to lower risk in the TSAT program so it can
enter the product development phase with greater chance of success.
However, as DOD prepares to implement a new incremental development
approach for the program, it faces gaps in knowledge that could hamper its
success. An incremental development will mean reduced capabilities in the
initial satellites and more advanced capabilities in the remaining
satellites. Given this change, it will be important for DOD to update
requirements in coordination with the TSAT user community. While senior
DOD officials have agreed to these reduced capabilities to get the first
satellite launched in 2014, DOD has yet to reevaluate its investment in
TSAT in light of other DOD investments using the knowledge it has now
gained. Using this new knowledge, DOD could be in a better position to set
more realistic goals, before entering product development.

United States Government Accountability Office

Contents

  Letter 1

Results in Brief 2 Background 3 DOD Not Meeting Original TSAT Goals 6 DOD
Taking Steps to Lower Program Risk but Additional

Knowledge Needed Before Product Development 10 Conclusions 15
Recommendations for Executive Action 16 Agency Comments 16

Appendix I Scope and Methodology 18

Appendix II Comments from the Department of Defense 19

Appendix III Onboard Signal Processing Technology Heritage 24

  Appendix IV Networking Technology Heritage 25

Appendix V Lasercom Technology Heritage 26

  Appendix VI Technology Readiness Levels 27 Tables

Table 1: Technology Readiness Levels of TSAT Critical Technologies 9 Table
2: TSAT Critical Technologies and Their Purposes 13

Figures    
              Figure 1: TSAT System Elements                                5 
               Figure 2: Changes to Key Milestones in TSAT's Acquisition  
              Schedule                                                      7 

Abbreviations

ABL                 Airborne Laser                                         
ACTS                Advanced Communications Technology Satellite           
AEHF                Advanced Extremely High Frequency                      
AISR                airborne intelligence, surveillance, and               
                       reconnaissance                                         
ALEX                Airborne Lasercom Experiment                           
CDR                 critical design review                                 
DBRA                dynamic bandwidth and resource allocation              
DOD                 Department of Defense                                  
DT&E                developmental test and evaluation                      
EHF                 extremely high frequency                               
GIG                 Global Information Grid                                
HAIPE               High Assurance Internet Protocol Encryptor             
IP                  Internet protocol                                      
LES                 Lincoln Experimental Satellite                         
LITE                Laser Intersatellite Transmission Experiment           
MDR                 medium data rate                                       
MIT                 Massachusetts Institute of Technology                  
NASA                National Aeronautics and Space Administration          
NGPR                next generation processor router                       
OSVS                Optical Standards Validations Suite                    
RF                  radio frequency                                        
SHF                 super high frequency                                   
SISR                space intelligence, surveillance, and                  
                       reconnaissance                                         
TCA                 Transformational Communications Architecture           
TMOS                TSAT Mission Operations System                         
TRANSEC             transmission security                                  
TRL                 technology readiness level                             
TSAT                Transformation Satellite Communications System         
TSOC                TSAT Satellite Operations Center                       
TSOE                TSAT Satellite Operations Element                      
XDR+                extended data rate plus                                

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
work may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this material
separately.

    Washington, DC 20548

U.S.U.S. national security agencies' satelnational security agencies'
satellliite-based communications.te-based communications.

Page 1 GAO-06-537 Transformational Satellite Communications System

funding, and technology development efforts, and GAO studies that discuss
acquisition problems and associated challenges, including our decade long
body of work on best practices in weapon system development. We conducted
our review from August 2005 to March 2006 in accordance with generally
accepted government auditing standards. For more on our scope and
methodology, see appendix I.

DOD is not meeting original cost, schedule, and performance goals

  Results in Brief

established for the TSAT program. When the program was initiated in 2004,
DOD estimated TSAT's total acquisition cost to be $15.5 billion and that
it would launch the first satellite in April 2011. TSAT's current official
cost estimate is nearly $16 billion, and the initial launch date has
slipped to September 2014-a delay of over 3 years. Furthermore, DOD has
changed the TSAT program to an incremental development approach and under
this approach, the initial delivery of capability will be less than what
DOD originally planned but the performance goal of the full five-satellite
constellation has not changed. After DOD established initial goals for
TSAT, Congress reduced the program's funding in fiscal years 2005 and 2006
because of concerns about the maturity of critical technologies and an
aggressive acquisition schedule. DOD developed the original goals before
it had sufficient knowledge about critical TSAT technologies, rendering
the goals unreliable. In early 2004, when DOD initiated the TSAT
acquisition, only one of seven critical technologies was mature.

DOD is taking positive steps to lower risk in the TSAT program before
entering the product development phase but as DOD prepares to implement a
new incremental development approach for the program, it faces gaps in
knowledge that could hamper the program's success. To lower risk, DOD has
separated technology development efforts from product development and is
conducting detailed reviews of the TSAT program at critical milestones.
Second, DOD has reduced program complexity and is incorporating software
development best practices for the software-intensive ground network that
is to interface with DOD's other planned ground networks, such as GIG, to
deliver enhanced capabilities. Third, DOD plans to demonstrate critical
technologies' maturity during key integration tests in fiscal year 2007,
before initiating product development. Despite these efforts, DOD could
improve the likelihood of program success by gaining additional knowledge.
In 2006, DOD directed the TSAT program to follow an incremental
development approach-a strategy that calls for reduced capabilities in the
initial satellites and more advanced capabilities in the remaining
satellites. This approach will likely reduce risks by introducing less new
content and

Page 2 GAO-06-537 Transformational Satellite Communications System

technology in the first two satellites. In light of this change, it will
be important for DOD to update requirements in coordination with the TSAT
user community. While senior DOD officials have agreed to reduced
capabilities up front to increase the confidence in launching the first
satellite in 2014, DOD has yet to justify the TSAT investment in light of
other DOD investments using the knowledge it has now gained. Using this
new knowledge, DOD could be in a better position to establish realistic
goals for the TSAT program before initiating product development.

To improve DOD's transition to transformational communications and gain
the additional knowledge needed before initiating TSAT product development
efforts, we are recommending that DOD (1) reassess the value of TSAT in
the broader context of other DOD investments, using updated knowledge on
likely cost, schedule, technology, and initial capability; (2) update
requirements in coordination with the TSAT user community; (3) demonstrate
the maturity of all critical technologies; and

(4) establish new cost, schedule, and performance goals. In written
comments on a draft of this report, DOD concurred with our
recommendations, and we have incorporated detailed comments where
appropriate (DOD's letter is reprinted in app. II).

Present and evolving threats highlight the need to design, operate, and

defend military communication networks to ensure continuity of joint
operations. However, current systems lack the connectivity, capacity,
interoperability, control, adaptability, availability, and coverage to
support military action. To address these shortcomings, DOD is moving
toward network-centric communication systems to facilitate critical
communication. A key system in this concept is TSAT-one of DOD's most
complex and expensive space programs involving the integration of
multiple, complex technologies never before integrated in a single space
system.

As early as 2001, DOD had developed a new Transformation Communications
Architecture (TCA) to guide the implementation of emerging communications
technologies. The TCA is an element of a broader global information
network or grid, DOD's overarching vision to provide authorized users with
a secure and interconnected information environment. The performance
parameters for the GIG define the fundamental requirements for the systems
to be interconnected through the TCA. The TCA is designed to realize the
benefits of an Internet protocol (IP) environment, as it will provide
instant accessibility to the military and intelligence communities. The
goal of the TCA is to provide

Page 3 GAO-06-537 Transformational Satellite Communications System

accessibility to all users while removing communications constraints
related to capacity, control, and responsiveness. It is composed of
elements in ground stations, aboard tactical vehicles, and in space.

TSAT is the space-based network component of the TCA that is expected to
provide survivable, jam-resistant, global, secure, and general purpose
radio frequency and laser cross-links with air and other space systems.
Some of the satellite technologies TSAT will employ have been evolving for
over 25 years. TSAT is building on these heritage technologies in three
primary areas: onboard signal processing for protection and connectivity,
networking, and space laser communication. Through these advanced
technologies, TSAT will improve communications to DOD, intelligence
community, and homeland defense users by transmitting large amounts of
data at a faster rate. Further, TSAT is designed to vastly improve
satellite communications by extending the GIG to users without ground
connections and making it possible for users to travel with small
terminals and communicate while on the move.

The TSAT system will consist of a five-satellite constellation (with a
sixth satellite for backup), the TSAT satellite operations element (TSOE)
which includes a primary TSAT satellite operations center (TSOC) for
on-orbit satellite control, a backup TSOC, and a set of transportable
units, a TSAT Mission Operations System (TMOS) to provide network
management, and ground gateways (see fig. 1).

Figure 1: TSAT System Elements

Source: Air Force.

DOD has awarded four TSAT contracts through separate bidding processes. In
2003 DOD awarded a contract to Booz Allen Hamilton for overall systems
engineering and integration. DOD also awarded two separate contracts to
competing contractor teams-Lockheed Martin Space Systems/Northrop Grumman
Space Technology and Boeing Satellite Systems-to conduct risk reduction
efforts and present development plans for the TSAT satellites. DOD expects
to award a contract to one of these contractor teams in 2007 to design and
build the satellites. Finally, in January 2006 DOD awarded a $2 billion
contract to Lockheed Martin Integrated Systems and Solutions to develop
TMOS and the overall network architecture. This network development
contractor is responsible for negotiating the interfaces between the TSAT
network and the space segment, user terminals, and other external
networks.

Recently, DOD changed the TSAT acquisition strategy to an incremental
development approach. This approach establishes time-phased development of
new products in increments. The first increment incorporates technology
that is already mature or can be matured quickly. As new technologies
become mature, they are incorporated into subsequent increments so that
the product's capability evolves over time. This approach also reduces
risks by introducing less new content and technology into a design and
development effort, an approach intended to enable developers to deliver a
series of interim capabilities to the customer more quickly. As such,
incremental development is considered a best practice for successful DOD
and commercial development programs because it allows these programs to
make cost and schedule estimates that are based on mature technologies.
Recognizing the benefits of evolving space systems, DOD included the
incremental development of space systems in its revised National Security
Space acquisition policy.

DOD is not meeting its original cost, schedule, and performance goals for
the TSAT program. TSAT's cost has increased by over $420 million, the
planned launch date for the first satellite has slipped more than 3 years,
and the satellites will be less capable than originally planned. Since DOD
established initial goals for the program, Congress has twice reduced the
program's annual budget and directed DOD to spend more time developing and
proving critical technologies. DOD developed the initial goals with
limited knowledge, when almost all of the critical technologies had yet to
be proven to work as intended. As a result, the goals were developed
without a high level of reliability.

  DOD Not Meeting Original TSAT Goals

    Initial Goals for TSAT Were Based on Limited Knowledge

When DOD started the TSAT program in January 2004, it estimated the total
acquisition cost to be about $15.5 billion. TSAT's acquisition cost had
increased to nearly $16 billion by the end of 2004.1 DOD also originally
scheduled critical design review (CDR) for April 2008 and the first TSAT
satellite launch in April 2011. CDR is now scheduled for September 2010
and the first launch in September 2014-delays of approximately 29 and 41
months, respectively. In addition, DOD recently changed its TSAT
acquisition strategy to an incremental approach by deciding to build the
first two satellites with fewer capabilities and delaying the more
advanced

1

At the time of this report, the 2005 end-of-year cost data and a new
program baseline were unavailable.

Page 6 GAO-06-537 Transformational Satellite Communications System

capabilities for the later satellites in the program. While the initial
two satellites will not perform as originally planned, the full
five-satellite system will still meet the original user requirements,
according to program officials.

According to program officials, the original goals for TSAT have been
revised several times as a result of reductions in program funding. After
DOD set its initial goals for TSAT, Congress twice funded the program at
levels below DOD's request (in fiscal years 2005 and 2006) because of
concerns about the state of technical maturity for key subsystems and an
aggressive schedule for acquisition. During this time, Congress also
directed the program to focus on the challenges of integrating the
technologies needed for the system. Figure 2 shows the changes to key
milestones dates in TSAT's acquisition schedules. The program recently was
directed to develop a new total acquisition cost estimate at a higher
level of confidence-which could further increase the amount of funding
requested in the near term for the program.2 However, as of April 2006,
DOD had yet to develop this new estimate.

       Figure 2: Changes to Key Milestones in TSAT's Acquisition Schedule

                 Source: Air Force (data); GAO (presentation).

DOD originally estimated the TSAT program cost using a 50 percent
confidence level, which meant that the program had a 50 percent chance of
being completed under or over budget. DOD is changing to an 80 percent
confidence level in its next estimate which should result in a higher,
more accurate, program cost estimate.

Page 7 GAO-06-537 Transformational Satellite Communications System

When DOD established initial goals for the TSAT program, it lacked
sufficient knowledge about key critical technologies. Our past work has
shown that a knowledge-based model leads to better acquisition outcomes.3
This model can be broken down into three cumulative knowledge points for
technology maturity, design maturity, and production maturity. At the
first knowledge point, a match is made between a customer's requirements
and the product developer's available resources in terms of technical
knowledge, time, money, and capacity. We have also reported that starting
a complex program like TSAT with immature technologies can lead to poor
program performance and outcomes.

In early December 2003, we reported that the Air Force would have
difficulty establishing goals when starting the TSAT program because
critical technologies were underdeveloped and early design studies had not
been started. 4 At that time, we recommended that the Air Force delay the
start of the TSAT program until technologies had been demonstrated to be
at an acceptable level of maturity and to consider alternative investments
to TSAT. One month later DOD started the program with only one of the
seven critical technologies mature, and could not have known with any
certainty what resources would be needed to eventually meet users'
requirements, despite having confidence in its technology development
schedule.

For the TSAT program, the Next Generation Processor Router (NGPR) and
laser communications are the highest-risk areas. Program officials
reported that three of the critical technologies in the NGPR are involved
with the transmission of data: (1) packet processing payloads, (2) dynamic
bandwidth and resource allocation (DBRA), and (3) protected bandwidth
efficient modulation using high data rates. The use of these Internet-like
processes will provide unprecedented connectivity for all TSAT users by
moving from an older circuit-based network (similar to telephone) to the
newer IP-based network (similar to the Internet). Additionally, DOD
continues to develop the technologies that are needed for laser

3

See GAO, Defense Acquisitions: Space-Based Radar Effort Needs Additional
Knowledge before Starting Development, GAO-04-759 (Washington, D.C.: July
23, 2004).

4

See GAO, Space Acquisitions: Committing Prematurely to the
Transformational Satellite Program Elevates Risks for Poor Cost, Schedule,
and Performance Outcomes, GAO-04-71R (Washington, D.C.: Dec. 4, 2003).

Page 8 GAO-06-537 Transformational Satellite Communications System

communications. Table 1 identifies the level of maturity of TSAT critical
technologies at program start and their expected maturity dates.

Table 1: Technology Readiness Levels of TSAT Critical Technologies

TRL level atTRL level as Expected Critical technology development starta
of March 2006 maturity dateb

Communication-on-the move antenna 4 6 N/A

Packet Processing Payload 6 6 N/A

Bandwidth Efficient Modulation (XDR+) 3 5 2007

Dynamic Bandwidth Resource Allocation (DBRA) 3 5 2007

Information Assurance - TRANSEC 3 6 N/A

Information Assurance - HAIPE 4 6 N/A

Single-Access Lasercom 5 5 2007

Multi-Access Lasercomc

Narrow field of view

                    Wide field of view 2 2 to be determined

Source: Air Force (data); GAO (analysis).

N/A: not applicable

a

TRL levels might vary in maturity among the viable suppliers.

b

These dates might vary depending on the viable supplier and refer to the
original acquisition approach; they could be different for an incremental
approach, as resources are restructured.

c

Multi-Access Lasercom is shown here for context only. The TSAT program is
being restructured and this technology is no longer part of the baseline
TSAT program.

To minimize the potential for technology development problems after the
start of product development, DOD uses an analytical tool to assess
technology maturity. This tool associates technology readiness levels
(TRL) with different levels of demonstrated performance, ranging from
paper studies to actual application of the technology in its final form.
For TSAT, the space segment contractors are using a series of events to
demonstrate and integrate the critical technologies into subsystems and
then testing to determine the extent the components function properly
together. The maturity levels of the critical technologies for TSAT
currently range from TRL 5 to 6, with the remaining technologies needing
integration testing to demonstrate maturity. (See app. VI for a
description of the TRL levels.)

According to program officials, these technologies will be demonstrated at
TRL 6 when key integration tests are completed in fiscal year 2007. The
two main tests facing the program are the second series of integration

Page 9 GAO-06-537 Transformational Satellite Communications System

  DOD Taking Steps to Lower Program Risk but Additional Knowledge Needed Before
  Product Development

testing on the Next Generation Processor Router and Optical Standards
Validation Suite (NGPR-2 and OSVS-2). Program officials said that the
program is using these independent tests to reduce risk by uncovering
technical problems before awarding the space segment contract for the
design and assembly of the satellites. The results of the tests are to be
assessed at the second interim program review before DOD makes a decision
to enter the product development phase of the program. At the time of this
report, results from the first series of integration tests were
unavailable.

DOD is taking positive steps to lower TSAT program risk, but additional
knowledge is needed before entering product development. DOD is separating
its technology development efforts from product development, continuing to
conduct program reviews before making key decisions, reducing program
complexity by staggering the awards on its ground and space segment
contracts, and incorporating knowledge-based metrics in software
development. Additionally, DOD is reducing risks in technology development
efforts by leveraging decades of knowledge on heritage systems and using
independent integration tests to demonstrate the maturity of critical
technologies. Despite these efforts, DOD faces gaps in knowledge that
could hamper successful outcomes. As DOD implements an incremental
approach for the TSAT program, it has yet to justify the TSAT investment
in light of other DOD investments using the knowledge it has now gained.

Efforts Under-Way Reduce DOD is reducing TSAT program risk in the
following ways: Program Risk

        * Separating technology and product development-DOD is separating
          technology development from product development and plans to prove
          that all critical technologies will work as intended before the
          TSAT program enters product development in 2007. In the past, DOD
          has not successfully implemented acquisition best practices in its
          space programs to reduce risks and increase the likelihood of
          better outcomes, particularly in some of its larger and more
          complex programs. We previously reported that DOD could curb its
          tendency to over-promise the capabilities of a new system and to
          rely on immature technologies in part by separating technology
          development from
        * product development (system integration and system demonstration).
          5 According to program officials, the TSAT program will not start
          building the TSAT system until all critical technologies needed for
          the system to satisfy user requirements are mature, ensuring a
          clear demarcation between the two phases of system development.
          This approach better enables decision makers to determine if a
          match exists between TSAT requirements and available resources
          (time, technology, capacity, and funding).
     o Conducting program reviews-DOD plans to continue conducting reviews of
       the TSAT program at key milestones to reduce program risk. DOD's space
       acquisition policy requires that program managers hold milestone
       reviews or independent program assessments as a program is nearing key
       decision points. Following this guidance, the TSAT program's
       acquisition schedule requires the program manager to assess program
       knowledge at specific points. The next major milestone is scheduled
       for the fourth quarter of fiscal year 2007, when the program will hold
       an interim program review to assess the program's readiness to proceed
       into the product development phase. Importantly, this review will
       include an assessment of the maturity levels of the critical
       technologies. Part of this review will involve the use of independent
       cost estimators as a way to develop an unbiased, consistent, and
       objective total cost estimate for the program.
     o Reducing ground and space segment complexity-DOD has lessened the
       likelihood of problems in development by reducing the complexity of
       the program. Specifically, according to program officials, the
       contract for ground-based network operations was awarded before the
       space segment contract so that the competing space segment contractors
       could work toward a stable and more mature network design. In January
       2006, DOD awarded a TMOS contract worth $2 billion to Lockheed Martin
       Integrated Systems and Solutions to start developing the overall
       network architecture and TMOS. Awarding this contract first will allow
       the competing space contractors to focus their satellite designs on a
       single architecture and mission operations system, thereby reducing
       program complexity.

See GAO, Defense Acquisitions: Improvements Needed In Space Systems
Acquisition Policy to Optimize Growing Investment in Space, GAO-04-253T
(Washington D.C.: July 12, 2005); and GAO, Military Space Operations:
Planning, Funding, and Acquisition Challenges Facing Efforts to Strengthen
Space Control, GAO-02-738 (Washington, D.C.: Sept. 23, 2002).

Page 11 GAO-06-537 Transformational Satellite Communications System

    Heritage Technologies and Independent Tests Reduce Program Risk

o  Incorporating software best-practices-Our review of the development
plans for the software-intensive TMOS segment that is to interface with
other networks like the GIG shows that DOD is also incorporating best
practices in this area to mitigate program risks. Our previous work has
identified and reported on three fundamental management strategies that
are best practices for software development: (1) implementing an
evolutionary approach, (2) following disciplined development processes,
and (3) collecting and analyzing meaningful metrics to measure progress.6
First, the evolutionary approach includes setting requirements,
establishing a stable design, writing code, and testing. Second,
successful acquisitions require that developers demonstrate they have
acquired the right knowledge before proceeding to the next development
phase. Finally, metrics such as costs, schedule, size of a project,
performance requirements, testing, defects, and quality provide evidence
that the developer has acquired appropriate knowledge in moving from one
phase to another. Although DOD's software acquisition plans may
incorporate these best practices, the potential for cost and schedule
increases because of unforeseen software complexity is inherent in the
development of a large quantity of software, as is needed for TSAT. To
manage this risk, program officials stated that extensive and fully funded
mitigation plans are in place and that the network contractor will be held
to the best practices through program oversight and reporting.

To reduce risk while developing the critical technologies for TSAT, DOD is
leveraging decades of existing knowledge from heritage systems. For TSAT
to be successful, DOD will have to integrate technologies that have been
proven to work in other space systems, but now must be integrated into a
single communication system. Officials at MIT's Lincoln Laboratory, who
are responsible for the independent testing and verification of TSAT
technologies, stated that there are no fundamental discoveries or
breakthroughs involved with developing TSAT. Rather, the enabling
technologies build upon architectures and technologies developed across
decades of space programs or experiments. However, officials at the
Aerospace Corporation who are working closely with the TSAT program stated
that there are risks involved in using heritage technologies- primarily
integration risks-because the technologies must still be tested

6

See GAO, Defense Acquisitions: Stronger Management Practices Are Needed to
Improve DOD's Software-Intensive Weapon Acquisitions, GAO-04-393
(Washington, D.C.: Mar. 1, 2004).

Page 12 GAO-06-537 Transformational Satellite Communications System

and evaluated to determine if they will work together as intended. The
three main TSAT enabling technologies are onboard signal processing,
networking, and laser communications. See table 2 below for a list of the
critical technologies and a description of their purposes.

Table 2: TSAT Critical Technologies and Their Purposes

Critical technology Purpose

Communication-on-the move antenna Provide satellite to ground link using a
1-foot antenna for mobile assets.

Packet Processing Payload Convert incoming analog radio signals into an
Internet-like packet of digital data and then interpret the header on the
data and pick the correct Internet-like address that is to receive the
data packet.

Bandwidth Efficient Modulation Provide a set of radio frequency waveforms
to (extended data rate plus: XDR+) transfer data from the satellite.

Dynamic Bandwidth and Resource Algorithm used to choose which radio

Allocation frequency waveform (XDR+) to use, depending on what speed the
data need to be sent; determined by such factors as environmental
conditions on the ground (e.g., urban, desert, trees, etc.).

Information Assurance (transmission TRANSEC algorithms and keys that
provide

security: TRANSEC) transmitted signal cover to avoid detection,
identification, and exploitation (such as traffic analyses.)

Information Assurance (high-Inline Network Encryptor devices to protect
assurance IP encryptor: HAIPE) user data.

Single-access lasercom Use of a single telescope, optical module,
high-power optical power amplifier, and modem to transport data along a
laser carrier from one location to another. Source: Air Force (data); GAO
(presentation).

TSAT is building upon the onboard signal processing developments in
military satellite communications that started in the mid-1970s. These
developments initially focused on providing highly robust communications,
but over time have evolved to increased capacity and bandwidth, as well as
enhanced efficiency. For example, the Lincoln Experimental Satellites
(LES) 8 and 9, Milstar I and II, and Advanced Extremely High Frequency
(AEHF) system have verified the onboard processing capabilities that will
be used in TSAT.

According to officials at the Lincoln Laboratory, much of the required
technology for the network services for TSAT comes directly from the

Page 13 GAO-06-537 Transformational Satellite Communications System

    Remaining Gaps in Knowledge Could Hamper Successful Outcomes

ground-based Internet. Further, TSAT is building on the successful
achievements of previous space programs like DOD's Milstar and AEHF
satellites, the National Aeronautics and Space Administration's (NASA)
Advanced Communications Technology Satellite (ACTS), and the Spaceway and
Astrolink satellites from the commercial sector. 7 In addition to
space-based signal processing, the TSAT satellites will use packet routing
in space, faster data transmission, and Internet-like data transmission
formats to produce the networking capability to extend worldwide network
services to the user.

TSAT will use high-rate laser communications to connect TSAT satellites
into a global network and to provide readout from other space- and
airborne intelligence, surveillance, and reconnaissance (SISR/AISR)
assets. According to Lincoln Laboratory officials, many of the needed
components for TSAT's laser communications are versions from commercial
optical networking. A series of three systems developed by Lincoln
Laboratory (Lincoln Experimental Satellites (LES) 8 and 9, Laser
Intersatellite Transmission Experiment (LITE) and LITE-2, and GeoLITE)
have and continue to demonstrate laser capabilities needed for TSAT.
Moreover, recent programs like Lincoln Laboratory's Airborne Lasercom
Experiment (ALEX) are providing knowledge about how TSAT's laser
communications can be used to support AISR assets, and DOD's Airborne
Laser (ABL) is helping scientist to characterize certain limits of laser
capabilities in atmospheric conditions, according to the officials.
Appendixes III through V further highlight the history of the technology
heritage being applied to TSAT.

Despite these positive steps to lower program risks, DOD faces gaps in
knowledge, as it begins to implement its new development approach, that
could impede TSAT's success. In 2006, DOD directed the program to follow
an incremental development approach, changing the contents of the program.
Under this approach, the program will deliver less capability in the first
two satellites, and then more advanced capabilities as technologies mature
and are incorporated into the remaining satellites. DOD has not fully
assessed the value of the TSAT investment in light of major changes to the
program.

7

Although the Astrolink system was never launched, the first payload was
essentially complete before the launch was canceled.

Page 14 GAO-06-537 Transformational Satellite Communications System

                                  Conclusions

Historically, many new development programs in DOD have sought to quickly
gain the latest capabilities,8 but because the technologies were not
mature enough to make such leaps, programs were often in development for
years while engineers continued to develop and mature the needed
technologies. This increased both the time and cost required to develop
the systems. An incremental approach, on the other hand, reduces risks by
introducing less new content and technology into a design and development
effort. The incremental approach for TSAT allows more time for the
development of higher-performing capabilities, thereby potentially
increasing the level of confidence in the launch date of the first
satellite, planned for 2014. High-level DOD officials have agreed to these
reduced capabilities up front, so the TSAT program now plans to deliver
satellites that meet user requirements in an evolutionary manner.

Notwithstanding the approval for the revised TSAT program from senior DOD
officials, DOD has yet to justify the TSAT investment in light of other
DOD investments using the knowledge it has now gained on cost, schedule,
and initial capabilities to be delivered. For example, TSAT's cost
estimate has increased and the initial satellites will be less capable
than originally expected. Furthermore, it is imperative, given the recent
changes to the program, that DOD work with the TSAT user community to
update requirements to ensure the timely delivery of promised
capabilities. Finally, it does not appear that DOD has completely
addressed all the unknowns concerning the relationship between TSAT and
two of DOD's other expensive and complex systems, namely the GIG and Space
Radar. For example, work still remains in finalizing the requirements for
these systems and understanding how the incrementally developed TSAT will
satisfy the needs.

DOD has taken action to put itself in position to prove out critical
technologies before initiating satellite development-an approach not
typically seen in DOD's space programs. DOD has taken further action to
reduce program risk by changing to an incremental development approach.
While this approach will reduce the capability of the first two
satellites, it is a positive step in reducing program risk because the
program will gain additional technical knowledge before integrating the
more advanced technologies into the satellites. Even though DOD is taking

8

See GAO, Missile Defense: Knowledge-Based Practices Are Being Adopted, but
Risks Remain, GAO-03-441 (Washington, D.C.: Apr. 30, 2003).

Page 15 GAO-06-537 Transformational Satellite Communications System

  Recommendations for Executive Action

such positive steps, TSAT is still expected to be one of the most
ambitious, expensive, and complex space systems ever built. TSAT is being
designed to transform military communication using Internet-like and laser
capabilities-key integrations risks. Other weapon systems are to interface
with it and will be highly dependent on it for their own success. While
DOD is planning to undertake new systems, such as TSAT, broader analyses
of the nation's fiscal future indicate that spending for weapon systems
may need to be reduced, rather than increased, given the constrained
fiscal environment. Given these challenges and fiscal realities, it is
prudent for DOD to reexamine the value and progress of TSAT before
committing to building the full constellation of communication satellites.

To improve DOD's transition to transformational communications by gaining
the additional knowledge it needs before TSAT enters product development,
we recommend that the Secretary of Defense direct the Under Secretary of
the Air Force to take the following four actions:

     o Reassess the value of TSAT in the broader context of other DOD
       investments, using updated knowledge on likely cost, schedule,
       technology, and initial capability;
     o Update requirements in coordination with the TSAT user community;
     o Prove that all critical technologies will work as intended; and
     o Establish new cost, schedule, and performance goals for the program
       once the above knowledge has been gained.

We provided a draft of this report to DOD for review and comment. DOD

concurred with our recommendations and provided detail comments, which we
have incorporated where appropriate. DOD's letter is reprinted as appendix
II.

We plan to provide copies of this report to the Secretary of Defense, the
Secretary of the Air Force, and interested congressional committees. We
will also provide copies to others on request. In addition, the report
will be available on the GAO website at http://www.gao.gov.

If you or your staff has any questions concerning this report, please
contact me at (202) 512-4841 or [email protected]. Contact points for our
Offices of Congressional Relations and Public Affairs may be found on the
last page of this report. Key contributors to the report are Arthur
Gallegos, Assistant Director, Tony Beckham, Noah B. Bleicher, G. Martin
Campbell,

Michael J. Sullivan Director, Acquisition and Sourcing Management To
assess the Department of Defense's (DOD) progress toward achieving cost,
schedule and performance goals for the Transformational Satellite
Communications System (TSAT), we collected and reviewed (1) budget and
expenditure plans, (2) acquisition planning documents, and (3) technology
and readiness information to determine if the program was meeting its
original goals. We compared changes in cost and schedule to original
estimates and evaluated DOD's plans for maturing the critical technologies
against best practice standards to determine if they will sufficiently
mature when DOD plans to start product development. We discussed this
information with DOD officials in the Office of the Secretary of Defense,
Program Analysis and Evaluation, Crystal City, Virginia; National Security
Space Office, Chantilly, Virginia; Space and Missiles Systems Center, Los
Angeles Air Force Base, California; and with officials at the
Massachusetts Institute of Technology (MIT) Lincoln Laboratory, Boston,
Massachusetts; and the Aerospace Corporation, El Segundo, California.

To determine if the TSAT program is using an acquisition approach that
will provide the knowledge it needs to proceed to product development, we
collected and reviewed documents that described the TSAT program's plans
to build knowledge and to mitigate risks. We reviewed detailed documents
related to capabilities, schedule, funding, and technology development for
the revised acquisition strategy. We considered DOD's current
knowledge-building activities against DOD and GAO studies that discuss
acquisition problems and associated challenges with acquisition
programs-including work on best practices in weapon system development
that we have conducted over the past decade. We analyzed the extent to
which the TSAT program is using a knowledge-based approach to technology
and product development. To do this, we focused on the whether the new
acquisition approach will meet user requirements and match those needs to
resources. We discussed DOD plans and efforts to meet user's needs with
DOD officials in the Military Satellite Communication Joint Program
Office, Los Angeles Air Force Base, California; Directorate of Space
Acquisition, Office of the Under Secretary of the Air Force, Arlington,
Virginia; and Office of the Assistant Secretary of Defense (Networks and
Information Integration), Arlington, Virginia.

We performed our work from August 2005 through March 2006 in accordance
with generally accepted government auditing standards.

                    Appendix VI: Technology Readiness Levels

Demonstration Technology Readiness Level Description Hardware/Software
Environment

7. System prototype demonstration Prototype near or at planned operational
Prototype. Should be form, fit Flight

in an operational environment. system. Represents a major step up from and
function integrated with demonstration in TRL 6, requiring the
demonstration of an other key supporting representative actual system
prototype in an operational elements/ subsystems to operational
environment, such as in an aircraft, vehicle demonstrate full
functionality environment such or space. Examples include testing the of
subsystem. as flying test bed or prototype in a test bed aircraft.
demonstrator

aircraft. Technology is well substantiated with test data.

     all cases, this is the end of the last "bug
fixing" aspects of true system development. Examples include using the
system under operational mission conditions.

 Source: GAO and its analysis of National Aeronautics and Space Administration
                                     data.

(120478)

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