[Satellite News 07-23-10] Comtech CEO Fred Kornberg said his company plans to file an appeal with the U.S. Government Accountability Office over the U.S. Army’s Blue Force Tracking 2 (BFT-2) contract award to ViaSat, announced July 22. 
    “Given our proven performance during a war-time environment, the performance capability of our BFT-HC transceiver and our belief that Comtech offers a lower overall program risk to the U.S Army as well as other factors, we anticipate protesting the award given to the third party,” Kornberg said in a statement.
    While Comtech has yet to announce details of the protest, Comtech’s Blue Force Tracking Program Manager Richard Leach told Satellite News that the Army informed the company that it considered its solution to be cost-effective during an interview conducted July 21. “We have been told that it would be more cost-effective to go with us as the incumbent since our BFT-2 system, BFT-HC, is compatible with legacy systems,” said Leach.
    ViaSat was awarded $477 million under the BFT-2 indefinite-delivery, indefinite contract and received the first delivery order for $37.7 million to fund deliveries of first article and initial production terminals and other ground networking equipment. ViaSat’s BFT-2 system is derived from its ArcLight mobile satcom technology, which uses VSAT antennas to provide broadband communications-on-the-move voice, video and services. Comtech, the proprietary owner of the BFT waveform, offered the Army its BFT-HC terminal, which is compatible with BFT legacy systems. Comtech’s said it was notified by the Army that it was not selected as the program manager and vendor and that an award was made to ViaSat based on a total evaluated price of $249.9 million — about 50 percent lower than the total evaluated price of Comtech’s BFT-2 proposal.
    The Army’s decision surprised Raymond James analyst Chris Quilty, who told Satellite News July 21 that he was “98 percent sure” Comtech would win the award based on the Army’s frequent BFT and MTS contract ceiling increases with the company. After the contract award was announced, Quilty told Satellite News that he could not explain the difference between Comtech’s and ViaSat’s statements. “Obviously, investors see this development as a shock. I am still trying to determine the difference between the two numbers. The $249.9 million figure, stated by Comtech, implies that the BFT-2 program will spend an average of approximately $41.7 million per year on BFT-2 services and hardware based on a six-year anticipated rollout.”

(Update: In a July 27 interview with Satellite News, ViaSat clarified that the $250 million figure, cited by Comtech, was an accurate reflection of ViaSat’s BFT-2 bid and that the $477 million figure represents the Army’s contract ceiling after comparing the bids and adding up evaluated quantities under a pyramid approach)

    During a July 21 interview, Quilty told Satellite News that he had been convinced for the past two years that Comtech would be the sole-sourced BFT-2 winner due to the Army’s current network structure and the demand for Comtech’s products. “The fact is that Comtech, with its current Army contract vehicles, is the incumbent for BFT-2. Comtech is the sole owner of the BFT-1 waveform and the incremental cost involved with switching over to ViaSat’s ArcLight technology is too great. With two wars going on and 100,000 vehicles dependent on this, shifting from one network to another stovetop network is too risky. You don’t want two sets of hardware and two sets of networks.”
    Quilty also believed that the Army would not have increased its MTS ceiling with Comtech so drastically if it was not planning to go with the company’s BFT-2 solution. “MTS was the Army’s original tracking solution and now BFT is pulling the weight. Would the Army have increased its MTS ceiling by $270 million if they weren’t considering Comtech for BFT-2? I don’t think so. The contract ceiling increase would have been $50 million if that were the case. This was a ‘wink-wink’ from the Army. When I saw this develop, I went from being 95 percent sure that Comtech was going to win this to being 98 percent sure.”