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The Pentagon’s Space Development Agency made awards worth a combined $1.8 billion on Monday to start building an interconnected mesh network of 126 small satellites in low-earth orbit, and what officials say will be the communications “backbone” of the military’s vision for Joint All-Domain Command and Control (JADC2).

Under the current plan, satellite launches are set to begin in September 2024 and start delivering battlefield communications capabilities shortly thereafter. But those specific payloads aren’t intended to continue doing so for very long. SDA’s approach calls for new “tranches” of relatively-inexpensive satellites to launch every two years, each adding incremental improvements based on proven commercial technologies.

DoD made the awards as other transaction agreements (OTAs) to three companies: Lockheed Martin ($700 million), Northrop Grumman ($692 million), and York Space Systems ($382 million).

Despite the vast price difference, the two larger, more traditional Defense companies are tasked with meeting the exact same requirements as York, a Denver-based firm which said it is focused on improving spacecraft affordability for government and commercial customers.

Each company will deliver 42 satellites, all of which must be interoperable with one another and with DoD’s systems, said Derek Tournear, SDA’s director.

“Each one was given a set of requirements and they bid to that capability. And realistically, York is just able to deliver at a lower price point than what Lockheed and Northrop bid,” he said during a roundtable organized by the Defense Writers Group. “We looked at schedule risk, we’re all about speed to make sure we hit those two year cycles. And then after that, 50% of the evaluation criteria is about cost reasonableness. It’s a big factor. Overall, it’s just that York is able to deliver at a lower price point.”

But cost and schedule weren’t the only considerations. SDA’s operating model is dependent on the idea that multiple vendors ought to be working at all times on the next tranche of space-based networking capabilities.

“That allows us to create this market where every two years we can have this open competition, and anyone can feel empowered to invest their own independent R&D to come up with an offering and then bid it back to us, and they have a shot at winning without there being a vendor lock,” he said. “Now, we can say that, but then how do we actually enforce it? We have a government reference architecture that’s the gold standard, where all of the vendors need to come and show that they can connect to our government-owned-and-run test lab. If you can talk to the government reference architecture, then you can talk to all the satellites, and you can push forward.”

In all, SDA received eight proposals for the latest competition, formally known as “Tranche 1” of the transport layer for the new National Defense Space Architecture.

One of the new capabilities the new constellation is meant to bring to JADC2 is the ability to let ground-based radios, ships and aircraft connect directly to satellites using the military’s Link 16 data protocol. Theoretically, they’ll be able to do that using radios that are already in the field, even though the widely-deployed standard was never designed to use satellite data links.

Another new feature: The satellites will communicate with each other – and with a limited set of new ground-based terminals via much faster optical (laser) data links instead of more traditional radio frequencies, which are also more susceptible to jamming and interference.

“Not everyone’s going to have an optical terminal that can talk to Tranche 1, but there are certain prioritized users that we’re working with to put an optical terminal on their platform, which will allow them to have high data rates with very low latency through that optical communication,” Tournear said. “Primarily that’s to enable large data transfer to targeting cells, and then from the targeting cells up to the transport layer so that we can get it down to the shooter via Link 16.”

What if none of it works? SDA strongly believes it will, but if some or all of Tranche 1 doesn’t perform as planned, that’s the advantage of working in quick technology insertion and replacement cycles, he said.

“SDA is built on two pillars: pillar number one is proliferation [of small satellites], but pillar number two is spiral development, and that second pillar is always plan B,” he said. “So we will always have a tranche that is in development, ready to launch essentially in two-year increments. I don’t anticipate all of Tranche 1 to fail. But if parts of it fail, then then Tranche 2 is right behind it, and it’ll be up there just two years later.”

Although the agency issued the latest round of awards as OTAs, in principle, it’s not averse to using traditional FAR-based contracts. SDA started some of the initial integration work for its new architecture with a $112 million contract to Perspecta, and managed to move through the FAR contracting process in just three-and-a-half months from RFP to final award.

In this case though, SDA decided the OTA path made the most sense for its spiral development process.

“I was always pretty adamant that the FAR allows you to go quickly,” he said. “The reason we switched to an OT is that there are some FAR clauses that were not consistent with what industry was proposing and what we wanted to do to move quicker. We went with the OT so that we could essentially give industry more freedom to propose on the time scales that we asked for.”

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