Business

October 23, 2013

DOD awards Iridium $400 million, five-year contract for Iridium airtime services

Iridium Communications Inc. announced Oct. 21 that it has been awarded a $400 million, multi-year, fixed-price contract with the Defense Information Systems Agency (DISA) to provide satellite airtime services to meet the communications needs of the U.S. Department of Defense and their federal partners.

This five-year contract renews the provision for delivering Enhanced Mobile Satellite Services airtime effective Oct. 22. Iridium will provide unlimited global secure and unsecure voice, low and high-speed data, paging and Distributed Tactical Communications System services for an unlimited number of DOD and other federal government subscribers.

The renewed EMSS contract extends the U.S. governments existing relationship with Iridium and ensures the continuation of service through new terms which offer program stability and the best value to the DOD to expand services supporting its critical missions. Both the multi-year and fixed-cost terms allow an even greater number of government subscribers to fully take advantage of the current capabilities as well as the enhanced services that will become available with Iridium NEXT – the Companys next generation satellite constellation scheduled for first launch in early 2015 ñ without concern for incremental cost increases based on usage changes or growth in demand.

The companys U.S. government service revenue for the full-year 2012 was $61.8 million. The EMSS fixed-price rate in each of the five contract years is $64 million in fiscal year 2014, $72 million in fiscal 2015 and $88 million in fiscal years 2016, 2017, and 2018.

Iridium is proud to continue its longstanding relationship of providing global, mobile communications to the Department of Defense, our largest single customer, said Scott Scheimreif, Iridiums executive vice president, government programs. We expect the DODs needs for satellite communication services will continue to grow over the next five to 10 years. At a time when the U.S. government is operating under greater fiscal constraints, Iridium is confident that both our service and contract terms will provide an optimal solution for our war fighters and other federal partners to communicate effectively now and in the future.

In 2012, U.S. government services and support made up 20 percent of Iridiums revenues. Government subscribers on the Iridium network have grown from 32,000 to more than 51,000 during the last five-year contract period as services grew from basic voice and paging, to data and Netted IridiumÆ with growing applications across all the services. According to the Defense Business Board fiscal year 2013 report to the Secretary of Defense, commercial satellite communications currently supports about 40 percent of the DODs satellite communication needs.




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