Hosted Payloads Todd Gossett Senior Director, Hosted Payloads, SES Government Solutions
What is a Hosted Payload? Use of power, mass, and space on a commercial satellite to accommodate a non-related mission owned by an organization or agency other than the primary satellite operator Hosted payloads are typically sensors, instruments, or even communications transponders. Host satellite SES-14, Airbus Eurostar 3000 Hosted payload NASA s Global Scale Observation of the Limb and Disk (GOLD) science mission 2
Why Use a Hosted Payload? Benefits--Frequent, Timely and Affordable Access to Space Shorter planning cycle: satellite construction 24 to 36 months Accelerated time to launch Frequent launch opportunities, ~20 per year to geosynchronous orbit Full spacecraft partnerships and planning Flexibility to accommodate a wide range of missions Shared platforms = shared costs Multiple payload operations options Assists development of resilient space architectures 3
End-to-End Partnership Satellite procurement Owner/operators have proven track record overseeing spacecraft procurement our business demands attention to performance, cost, & schedule Can t be late to orbit the business depends on on-orbit capability Can t be over budget companies have a fiduciary duty to their share holders Contracts written to penalize vendors for late satellite delivery All requirements for the hosted payload, e.g. data/power interfaces, thermal couplings, pointing accuracies, etc., are included in RFP to spacecraft manufacturers Ensures seamless integration and management, as well as minimizes risks Satellite owner/operators oversee spacecraft procurement and have latitude to select spacecraft to meet core business and hosted payload requirements 4
End-to-End Partnership Systems Engineering Support Owner/operators employ program managers with years of system engineering experience Often co-located at the manufacturer s facilities Satellite manufactures meet owner/operator s exacting integration requirements Selected manufactures have experience in I&T of secondary payloads Spacecraft are based on standard designs, customized to meet the unique customer/business requirements at each orbital location Customization includes modifications to meet hosted payload integration requirements Owner/operator partnership with spacecraft vendor ensures core/hosted mission integration needs are met 5
End-to-End Partnership SES Experience Payload integration on the spacecraft is a core competency Integration of communications payloads onto the satellite bus is our area of expertise We treat the integration of secondary / hosted payloads in the same demanding and rigorous method SES has the most stringent environmental test program in the industry and it must be completed on the fully integrated spacecraft SES provides for the launch of all of our satellites Contracts with the world s leading launch providers SES maintains satellite, payload and network operations centers around the world On-Orbit performance exceeds 99.99% availability Satellite on-orbit operations exceed the satellite manufactures expected lifetimes on virtually all of our spacecraft SES s proven track record: 53 geosynchronous satellites on orbit, 5 hosted payloads 6
Case Study Commercially Hosted Infrared Payload (CHIRP) Customer U.S. Air Force Space and Missile Systems Center Program 9.5 month experimental mission testing new technology from GEO (wide field-of-view infrared staring sensor) ops extended to Dec 2013 Sensor developed under separate contract Program included: Integration of the ~100kg/~250w sensor onto SES-2 spacecraft, launched 21 Sep 2011 Development and integration of an Orbital/ATK secondary payload interface Sensor operation, data delivery and analysis Creation & operation of sensor operations and analysis centers 6 C-band commercial transponders 1 active for data delivery 5 more disabled during the mission to supply required power CHIRP was hosted for a fraction of the cost of a dedicated satellite; helped advance technology and greatly reduce risks for future operational missions 7
Other examples Internet Routing in Space (IRIS) for DoD, on IS-14 Intelsat/Cisco/Space Systems Loral Wide Area Augmentation System (WAAS) for FAA, on SES-15 SES/Boeing Global-Scale Observation of the Limb and Disk (GOLD) for NASA, on SES-14 SES/Airbus/CU LASP UHF for Australian Defense Forces, for Australian government, on IS-22 Intelsat/Boeing X-band payload for Astrium Services, on Anik G1 Telesat/Space Systems Loral Automatic Dependent Surveillance Broadcast (ADS-B), on multiple Iridium NEXT spacecraft Iridium/Aireon/Orbital/Thales/Harris Hosted payloads are becoming an increasingly viable option for Government missions
Closing the deal Assuming spacecraft size, weight, power, orbital location, etc. meet hosted payload requirements and government selects you as host, the fun begins Complex negotiations Multiple parties e.g. NASAUniv Central FloridaUniv of ColoradoSES GSSESAirbus Defense & Space Contract timing Risk Federal Acquisition Regulations Successfully negotiated/agreed to contract lays the groundwork for successful hosted payload program 9
Thank you!
Hosted Payloads Pre-Launch Issues Douglas Svor 2016 Space Law Symposium June 8, 2016 Sheppard Mullin Richter & Hampton LLP 2016
Pre-Launch: Nature of the Single Manufacturer Hosted Payload Two Manufacturers 1 2
Pre-Launch: Potential Integration Risk of Loss/Title in Transit Issues Title Following Integration of Hosted Payload Delay in Delivery of Hosted Payload to Satellite Manufacturer Acceptance Testing by Host/Satellite Manufacturer Opportunity to Fix Error in Hosted Payload Opportunity to Fix Error in Integration of Hosted Payload into Host Mass Dummy Access to Hosted Payload Manufacturer for Host Progress Reports Successor Hosted Payloads Does Host have 1 st Right of Refusal? 1 3
Pre-Launch: Contractual Issues Contractual Issues Moving the Satellite Satellite operator may need to accept limitations on movement 1 4
Pre-Launch: Financial Issues Financial Issues Revenue Share What happens if transponder failure? Force Majeure Is satellite launch failure a force majeure? Export Credit Agency Financing Can create execution risk 1 5
Pre-Launch: Technical Issues Contingency Planning for Potential Technical Issues Transponder/Satellite Loss or Failure Upon launch In orbit Insurance Power priority 1 6
Pre-Launch: Regulatory Issues Export Control Issues FCC Licensing Issues Ground Component Space Component Market Access Other Agency Licensing Issues NOAA 1 7
Thank You! Douglas A. Svor Associate, Communications Practice Group Sheppard Mullin Richter & Hampton LLP 2099 Pennsylvania Avenue NW, Suite 100 Washington, DC 2006 dsvor@sheppardmullin.com (202) 747-2305 (office) 1 8
On-Orbit Issues 2016 Space Law Symposium Rolf Olofsson Retired Partner of Counsel June 8, 2016
On-Orbit Issues Orbital Location Regulatory Authorizations All of the following comments address issues common to hosted payload projects outside the USA, where typically the Host Satellite (including the owner) and the Hosted Payload will be of different nationalities The Host Satellite will commit to operate the Satellite at a specified orbital location for a specified period of time The Hosted Payload needs confirmation that the frequencies that are required are available at the proposed orbital location with the coverage necessary to perform the Service 20
On-Orbit Issues Use of Radio Frequencies The contract needs to specify who is responsible for securing the frequencies required to operate the Host Satellite respectively the Hosted Payload at the orbital slot Where the Host Satellite holds the rights to the frequencies to be used by the Hosted Payload there will typically be a license agreement with a fee for such use Party responsible for obtaining landing rights may be different than the party responsible for securing the orbital slot and the right to operate in the specified frequencies 21
On-Orbit Issues Acceptance, Title and Risk of Loss If Owner/Operator of Host Satellite procures Hosted Payload from satellite manufacturer on behalf of payload owner/operator the following will typically apply: Separate In-Orbit Acceptance process for the Hosted Payload with its share of remedies typically calculated on the basis of the satellite price allocation or a similar formula Title and Risk passes to the Hosted Payload from the owner of the Host Satellite simultaneously with the satellite owner receiving delivery of the satellite, including the Hosted Payload This approach can create issues in the event of a bankruptcy on the part of the owner of the Host Satellite where applicable law requires possession of chattel for protection. This will in some cases require additional measures be taken to protect the Hosted Payload 22
On-Orbit Issues On-Orbit Failure Total Loss Risk of loss to the Satellite and the Hosted Payload assumed respectively by the owner of the Satellite and the owner of the Hosted Payload The contract normally does not provide for indemnification by either party for damage caused by the Satellite to the Hosted Payload or by the Hosted Payload to the Satellite. The Parties are expected to cover this risk through insurance There is a standard indemnity for any loss suffered as a result of the other party s activities when the satellite and or the Hosted Payload is capable/expected to be used for TV and radio broadcasting e.g. slander etc. 23
On-Orbit Issues On-Orbit Failure Partial Loss If there is a loss of power, the contract may provide that the loss be shared in the same proportion as the power generated by the Satellite is distributed between the parties pursuant to the contract Another option that has been used when both the Satellite Payload and the Hosted Payload consist of transponders of the same bandwidth is to designate proportionately the transponders to be turned off as available power is reduced 24
On-Orbit Issues INSURANCE Launch Risk and In-Orbit Insurance procured separately by each party or procured separately by the Owner of the Host Satellite on behalf of both parties with the Owner of the Hosted Payload being named as an Additional Insured or procured jointly by the Owners of the Host Satellite and the Hosted Payload Occasionally the Parties will carry third party liability insurance covering any potential liability resulting from its activities with respect to the Host Satellite and the Hosted Payload 25
On-Orbit Issues Satellite Operation TT&C The contract will normally leave the Owner of the Satellite fully in charge of satellite operation The Owner of the Satellite is required to keep the Owner of the Hosted Payload fully informed about all aspects of the operational status of the Satellite that could affect the Hosted Payload The contract may provide that the Owner of the Hosted Payload shall operate the Hosted Payload this assumes that the technical means for such operation are available 26
On-Orbit Issues Satellite Operation TT&C (cont.) TT&C will be performed by the Owner of the Host Satellite However, where the Owner of the Host Satellite and the Owner of the Hosted Payload are of different nationalities and the Hosted Payload wholly or partly will be used by the military forces of that country, then limited satellite control with respect to certain antennas and transponders may need to be established from a network operations center in such country The Owner of the Satellite is obligated to consult with the Owner of the Hosted Payload prior to decommissioning the Satellite but the decision and responsibility for the decommissioning lies with the Satellite Owner 27
On-Orbit Issues Procurement of Replacement Satellite and Follow-On Satellite Where the Hosted Payload represents significant bandwidth to be used for TV Broadcasting from a hot spot orbital slot the Owner of the Hosted Payload may require an option to place the Hosted Payload on a Replacement Satellite in the event of a Launch Failure In-Orbit Failure Depending on the importance of the Orbital Slot the Owner of the Hosted Payload may also require that the Hosted Payload be included on a Follow-On-Satellite 28
On-Orbit Issues Audit Rights In contracts where the price to be paid for the Satellite and the launch thereof is not known at the time of the agreement being made between respectively the owner [to be] of the Host Satellite and the owner [to be] of the Hosted Payload the parties will, as an alternative agree on the percentage of the cost of the satellite, launch and insurance to be assumed by each party and/or the formula to be applied to derive at such cost distribution When, thereafter, the Owner of the Satellite procures the Satellite including the Hosted Payload it may be necessary to include audit rights for the other party 29
Thanks Rolf Olofsson Space Law Advisors LLC rolf@spacelawadvisors.com +1 202 549 7255 30
Anatomy of a Hosted Payload Involving the U.S. Government Keith R. Szeliga 2016 Space Law Symposium June 8, 2016 Sheppard Mullin Richter & Hampton LLP 2016
Anatomy of a Hosted Payload Involving the U.S. Government Initial Contracting Issues Who will be the prime contractor? Payload manufacturer Satellite manufacturer Satellite operator Why does it matter? Control Risk 3 2
Anatomy of a Hosted Payload Involving the U.S. Government Initial Contracting Issues What if the Government has not issued an award by the time the satellite manufacturer must bend metal? Will the prime contractor be required to cover change fees due to the satellite manufacturer? Will the prime contractor s payment be actual change fees or liquidated damages? 3 3
Anatomy of a Hosted Payload Involving the U.S. Government Definitive Contract Issues Flow-downs Subcontract for commercial items Customization of standard clauses 3 4
Anatomy of a Hosted Payload Involving the U.S. Government Definitive Contract Issues Changes Is a changes clause required? What are the procedures and limitations? 3 5
Anatomy of a Hosted Payload Involving the U.S. Government Definitive Contract Issues Termination Rights and Remedies Termination for convenience Termination for default 3 6
Anatomy of a Hosted Payload Involving the U.S. Government Definitive Contract Issues Inspection and Acceptance In-Process inspection Latent defects 3 7
Anatomy of a Hosted Payload Involving the U.S. Government Definitive Contract Issues Technical Data and Computer Software Payload vs. bus Commercial items Patent Rights Is a clause required? 3 8
Anatomy of a Hosted Payload Involving the U.S. Government Contract Disputes Duty to proceed Claims process and forums Flow-down to subcontractors 3 9
Thank You! Keith Szeliga Co-Practice Group Leader, Government Contracts, Investigations & International Trade Practice Group Sheppard Mullin Richter & Hampton LLP 2099 Pennsylvania Avenue NW, Suite 100 Washington, DC 2006 kszeliga@sheppardmullin.com (202) 747-1927 (office) (202) 747-3810 (fax) 4 0