If the market analysis reports are correct, military satellite size and demand are heading in the opposite direction, as the fiscally constrained international market will result in more cooperation between nations on developing and sharing military capabilities. That cooperation was put on full display at the 2012 Hosted Payload Summit this past September, which followed the launch of the IS-22 satellite with a hosted payload for the Australian Defense Force (ADF) and heralded a new era in international milsatcom.
   Hosted Payload Alliance Chairman Don Thoma opened the one-day event by announced a new initiative that his organization will undertake this year. “We want to create a hosted payload playbook that will outline the opportunities and challenges for hosted payload developers, providers and customers,” Thoma told attendees.
   Douglas Loverro, the Executive Director of the Air Force’s Space and Missile Systems Center and senior civilian executive then gave a keynote speech that highlighted the 10 most important events for hosted payloads in 2012.
   The first of those events was recently re-elected U.S. President Barack Obama’s full-year 2013 budget released in February 2012. “What was significant about this was that there were dollars specifically outlined in the budget to continue work on hosted payloads,” said Loverro. Other events included: the release of NSR’s second edition of its Hosted Payloads on Commercial Satellites report; the formation of the SMC hosted payload office, which outlines a hosted payload cost model; CHIRP+, protected milsatcom and military weather BAAs; the first unclassified CHIRP imagery; the 2014 draft defense planning guides; the NASA and Loral deal on Hosted Payload terminals; and the announcement of the SMC hosted payload ID/IQ contract, which Loverro referred to as “the first step in moving toward a normal, accessible and repeatable hosted payload arrangement, which is expected in the next six to nine months,” he said.
   According to NSR Senior Analyst Claude Rousseau, the milsatcom market could see some interesting deals in the pipeline, highlighting the positives of the sector. “There is some uncertainty around some programs, but equally, we are not seeing this market die. The commercial industry can still expect some contracts to come their way. We are seeing a continuation of contracts with the U.S. Department of Defense – notably the L-3 GCS contract with USSOCOM for deployable VSATs. There are bright spots, but there is a lot of uncertainty regarding the future. A lot of this has to do with budget cuts. The issue will be whether or not governments want to build their own systems, own them and operate them themselves.”
   Loverro also noted a couple of negatives that happened for hosted payloads, such as the low marks the CHIRP+ payload received from the HAC-D congressional committee and the failure to find a deal between Iridium and the government on hosted payloads. “Hosted payloads not only saw progress through its successes, but also through its failures,” Loverro told attendees. “In the case of Iridium, we just couldn’t make it work, but it also showed us how we can make it work. The low HAC-D marks shows us that not everyone in Congress has bought into the hosted payload concept.”
   The Hosted Payload Summit was split into five sessions. The first focused on lessons that the commercial satellite industry learned from public-private partnerships executed with international governments. The panel focused on Intelsat’s hosted payload project with the Australian Defense Force (ADF), which operates a UHF payload on the Intelsat 22 satellite.
   Intelsat General Vice President of Hosted Payload Programs Don Brown gave attendees two pieces of advice when trying to find hosted payload business. “The first is that you have to articulate a viable commercial model and approach to hosted payloads with your customer,” said Brown. “The second is never lean forward on a commercially hosted payload for government use.”
   Strategy Analytics Director of ADS Service Asif Anwar said that the rise of the small satellite in major military space build-out plans have just as much to do with compatibility as it does with cost. “Advances in technology have elevated the status of small satellites and we will see more utilization as they complement traditional satellite platforms,” Anwar said in the report. “From an operational perspective, small satellites supplement the close-up view that can be provided with tactical UAVs with added situational awareness.”