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Updated: July 8th, 2008 05:26 PM CDT

Defense Companies Battle Over Lucrative New Satellite Program

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By KATHERINE SHRADER
Associated Press Writer

The stakes are high on the program, known as Future Imagery Architecture.

For the companies, it means billions of dollars.

For Negroponte, it's an early test of the authority Congress gave him in last year's intelligence overhaul law.

"It is a signature initiative for him," said John Pike, a satellite expert and director of GlobalSecurity.org. "And he cannot afford to lose on it. ... All these people who said Mr. Negroponte is going to be in charge are going to look not so good if Boeing manages to overturn him."

U.S. officials rely on photo-reconnaissance satellites to gather visual information from space about adversarial governments and terrorist groups. That could include construction at suspected nuclear sites or terrorist training camps. Classified satellites can also be used to survey damage from hurricanes, fires or other natural disasters.

Agencies including the National Reconnaissance Office, which builds and manages the nation's spy satellites, are eager to replace an aging fleet of satellites whose fuel for their maneuvering rockets cannot be replenished after launch.

Yet new satellite systems are notorious for cost overruns and schedule delays. That is partly because, unlike most government purchases, the bulk of the expenses come during the early, less predictable development phase.


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