Satellite work keeps Boeing flying

Defense giant uses exisiting contracts for growth

For more than a decade, the Defense Department has sought to provide warfighters with programmable radios that can communicate with almost any existing defense or civilian radio.

Earlier this year, Boeing Co. delivered two development models of the Joint Tactical Radio System (JTRS), and the company hopes to progress to low-rate production of the radios sometime next year, said Jeff Trauberman, vice president of business development for Boeing’s Network and Space Systems, part of the company’s Integrated Defense Systems division.

“Next year, assuming we get the go ahead, they will start to build a limited number of radios which will get deployed beyond user tests and out into the field,” Trauberman said. “Shortly thereafter, they will start building the radios in quantity.”

With the new administration evaluating government programs and with tight federal budgets, Boeing is focusing on the government contracts it has in hand.

“We really view this as a critical year of execution,” Trauberman said. “And that is what we are focused on.”

That focus helped the company maintain a firm grip on its No. 2 ranking with $10.8 billion in prime information technology contracts during fiscal 2008.

The JTRS program, military satellite programs, the International Space Station and other programs are difficult and complex, but if successful, they could lead to future contracts, Trauberman said.

“People take these things for granted, but they are very hard to do; delivering these capabilities,” he said. “We are really looking at this year as a series of major execution milestones and successes because nothing persuades customers more of the value we can bring them than being able to demonstrate our execution on these things.”

Boeing’s work on the Wideband Global SATCOM satellite is an example of a project the company expects to deliver on in 2009 and beyond. The first of six satellites for the program went operational last year, and Boeing launched the second satellite April 3.

The new satellites substantially increase the military’s available telecommunications bandwidth. One of the new satellites has more capacity than the entire Defense Satellite Communication System, the constellation of satellites it is replacing, according to Boeing.

“There is an ever-growing demand for bandwidth and information…and that is reflected in the military marketplace,” Trauberman said. “As we deploy these satellites there will be a marked improvement in the ability of our soldiers, sailors, aviators and our military customers in general to communicate with each other.”

Focusing on projects that are already under way and funded is a good strategy, said Marco Caceres, a senior analyst and director of space studies at Teal Group Corp.

“I don’t see any major new satellite contracts being awarded this year,” he said. “Right now, the new administration is simply evaluating the programs they have, and if anything, some of the big satellite programs that haven’t been awarded yet are in the process of being canceled.”

In April, Defense Secretary Robert Gates announced plans to scale back or cancel several programs including the $26 billion Transformational Satellite jam-proof communications program.

The termination of such programs could be bad news for Boeing and its competitors, but opportunities still exist, Caceres said.

With the potential demise of TSAT, DOD could potentially invest more in the Wideband Global SATCOM program, he said.

“Because the requirement for military communications and bandwidth doesn’t go away just because a program is canceled,” Caceres said, “they are going to need some other satellites that are less costly to fill in the gap.”

Boeing also is looking to diversify, and the company’s satellite work is not limited to DOD.

For example, Boeing is preparing to launch the second in a series of three Geostationary Operational Environmental Satellites built for NASA and the National Oceanic and Atmospheric Administration. The satellites improve the ability to capture images and track severe weather, such as hurricanes, and provide advanced warning of potentially damaging storms.

More stats on Boeing.

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