UltiSat is seeing a lift in contract awards as government budgets loosen. Photo: UltiSat
[Via Satellite 01-14-2016] UltiSat, a satellite communications provider that operates out of Maryland in the United States, is looking forward to growing government activity after a “perfect storm” of sequestration and overcapacity capped the market in the last few years. The company — which provides satellite communications and infrastructure in the form of VSAT, teleport and mobile satellites services, among others — has historically pulled most of its business from the military and government sector, relying heavily on Department of Defense (DOD) and Non-Governmental Organization (NGO) agencies that require secure converge and managed networks.
While UltiSat CEO Moe Abutaleb admits that overcapacity in the satellite market in conjunction with decreased budgets put a pinch on margins across the entire value chain “starting from the satellite operators, down to the network operators, and into service providers like UltiSat, into the system integrators and even the equipment manufacturers” for the last few years, it looks like some of that government demand is starting to come back.
“In the last year, we’ve started to see demand pick back up in parts of the DOD,” Abutaleb told Via Satellite. “Budgets are starting to increase again as we go into 2016. And the needs that are emerging for the government are hard — no longer soft needs. They are hard needs arising as a bi-product of some of the increased military activity that we see.”
A lot of these hard needs manifesting in the DOD have to do with forward deployments and in moving assets and resources into different parts of the world, according to Abutaleb. Secure communications are one of the first resources needed in contested environments, he said.
“When it comes to these fairly austere forward deployed environments, often the most effective and efficient form of comms is satellite communications,” said Abutaleb.
Specifically, the UltiSat is seeing a pick up in task-order based Indefinite Delivery, Indefinite Quantity (IDIQ) contracts from the DOD in areas such as Europe, Southwest Asia and the Middle East. In March, the company received a contract renewal through an unnamed government agency to continue providing wireless network solutions into Kandahar and Bagram in Afghanistan, tasked with upgrading wireless services to enable data rates above 100 Mbps utilizing Comtech EF Data modems. Similarly, it has seen an award in the last year to provide a managed Very Small Aperture Terminal (VSAT) communications network solution to an unnamed U.S. government agency.
Going forward, however, Abutaleb notes the demographic is shifting a bit from the traditional areas of focus and to new regions, such as Africa and the Pacific.
“In the case of the Pacific, there is a lot of activity there, a lot of it being airborne Intelligence, Surveillance and Reconnaissance (ISR)-based that is beginning to take place in support of [U.S. Pacific Command] PACOM and the other Combatant Commands (COCOM) that are also operating in the Pacific,” he said.
Meanwhile, activity over Africa is picking up as a result of both increased DOD demand as well as for humanitarian missions across the continent.
“In the case of Africa, humanitarian NGO-type missions are driving recent activity, and that just keeps growing and growing,” said Abutaleb. “We are seeing all the DOD via [U.S. Africa Command] AFRICOM and other COCOMS starting to operate in parts of Africa. We tend to play in the forward deployed environment for those types of end users. Where they need connectivity capability, we go.”
Providing communications for humanitarian efforts across the continent has proven to be less straightforward than dealing with DOD operations, however, as the customer tends to be a heavily budget-constrained while operating in a difficult market. Moreover, regulatory and logistics issues associated with the export and importation of materials often creates a difficult operating environment.
“The regulations are dynamic at the least and ad hoc in some occasions, so you are constantly having to adapt and figure out what the regulations are so you can get a product into and out of these difficult territories,” said Abutaleb. “We don’t see that kind of problem in the case of the DOD.”
The humanitarian sector also tends to call for a multi-country network, where UtliSat is tasked with building networks that are not just on one continent, but sometimes on six continents, meaning that one network often has to go across “six or seven satellite beams, three or four teleports and then bring it all to a single data center,” said Abutaleb.
Abutaleb said UltiSat relies on lessons-learned to ensure that materials don’t get stuck in customs for six or seven months while missions trudge on without communications. Working in a difficult sector has proven profitable due to the lack of competition, but the CEO stresses that to continue seeing profits the company has to keep on top of shifting logistics.
“A lot of companies have tried to get into the sector but there aren’t really that many that play on a global level, so to a certain extent it’s a fairly limited competition market for these large, global networks. But, by the same token, they are such phenomenally difficult networks that if you mess up you really pay the price,” he said.
The post UltiSat CEO Sees Expanding Government Networks on the Horizon appeared first on Via Satellite.