Fast Facts

The Department of Defense spends billions of dollars a year on satellites that provide critical communications, reconnaissance, and other capabilities.

We found that DOD may be able to save money and add capabilities faster by paying private companies to host government sensors or other equipment on their satellites. DOD estimates it has already saved hundreds of millions of dollars from this cost-sharing approach.

We recommended that DOD gather data in a central location from its programs that use these commercially hosted payloads. Assessing this data could help DOD make reasoned, evidence-based decisions on future host satellite use.

Illustration of Satellites Owned by DOD, Other Agencies, Foreign Countries, and Private Companies

Graphic representing the man-made satellites that orbit the Earth.

Graphic representing the man-made satellites that orbit the Earth.

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Highlights

What GAO Found

GAO and others have found that using commercial satellites to host government sensors or communications packages—called payloads—may be one way DOD can achieve on-orbit capability faster and more affordably. Using hosted payloads may also help facilitate a proliferation of payloads on orbit, making it more difficult for an adversary to defeat a capability. Since 2009, DOD has used three commercially hosted payloads, with three more missions planned or underway through 2022 (see figure below).

DOD Hosted Payload Missions from 2009 to 2022

DOD Hosted Payload Missions from 2009 to 2022

DOD estimates that it has achieved cost savings of several hundred million dollars from using commercially hosted payloads to date, and expects to realize additional savings and deliver faster capabilities on orbit from planned missions. Cost savings can result from sharing development, launch, and ground system costs with the commercial host company.

Among the factors that affect DOD's use of hosted payloads are

a perception among some DOD officials that matching government payloads to commercial satellites is too difficult; and

limited, fragmented knowledge on how to mitigate various challenges

GAO found that further opportunities to use hosted payloads may emerge as DOD plans new and follow-on space systems in the coming years. However, DOD's knowledge on using hosted payloads is fragmented, in part because programs are not required to share information. In 2011, the Air Force created a Hosted Payload Office to provide expertise and other tools to facilitate matching government payloads with commercial hosts. However, GAO found that DOD programs using hosted payloads are not required and generally do not provide cost and technical data, or lessons learned, to the Hosted Payload Office, or another central office for analysis. Requiring programs that use hosted payloads agency-wide to provide this information to a central location would better position DOD to make informed decisions when considering acquisition approaches for upcoming space system designs.

Why GAO Did This Study

Each year, DOD spends billions of dollars to develop, produce, and field large, complex satellites. For such satellite systems, a single adversary attack or on-orbit failure can result in the loss of billions of dollars of investment and significant loss of vital capabilities. As DOD plans new space systems and addresses an increasingly contested space environment, it has the opportunity to consider different acquisition approaches. One such approach is to integrate a government sensor or payload onto a commercial host satellite.

House Armed Services Committee report 115-200, accompanying a bill for the Fiscal Year 2018 National Defense Authorization Act, included a provision for GAO to review DOD's use of commercially hosted payloads. This report (1) determines the extent to which DOD uses commercially hosted payloads and (2) describes and assesses factors that affect their use.

GAO reviewed DOD policies, documentation, and planning documents, and interviewed a wide range of DOD and civil government officials, and commercial stakeholders.

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Recommendations

GAO recommends that DOD require programs using commercially hosted payloads to contribute resulting data to a central location. In implementing this recommendation, DOD should assess whether the Air Force's Hosted Payload Office is the appropriate location to collect and analyze the data. DOD concurred with the recommendation.

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Defense 1. The Secretary of Defense should require programs using hosted payloads to provide cost and technical data, and lessons learned to a central office. In implementing this recommendation, DOD should consider whether the Hosted Payload Office is the most appropriate office to centralize agency-wide knowledge. (Recommendation 1)
Closed - Implemented
DOD concurred with our recommendation and stated that the Air Force Space and Missile Systems Center (SMC) had initiated a major reorganization since we drafted our report. DOD stated that under the new organizational construct, the Hosted Payload office had changed and may not be the appropriate office for centralizing DOD-wide hosted payload knowledge. In February 2019, Air Force Space Command (now U.S. Space Force) took primary responsibility for coordinating and tracking hosted payload information. The Hosted Payload Office, newly part of the Prototype Development & Execution branch within SMC, began developing a secure method for sharing data on hosted payloads through the Commercial Hosted Payload Information Repository on the Defense Intelligence Information Enterprise Framework. In April 2020, the Deputy Secretary of Defense (1) designated the U.S. Space Force Enterprise Operations Division as the lead office responsible for coordinating information, processes, and lessons learned relating to using commercially hosted payloads; and (2) requested military departments and other defense agencies to provide information on past, current, and planned hosted payloads to the Enterprise Operations Division for centralizing data to help inform future decisions. By implementing this recommendation, DOD will have more knowledge for determining when using commercially hosted payloads will result in delivering capabilities more quickly, more affordably, and with increased resiliency.

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