Harris, Lockheed team for FAA work

Harris Corp. and Lockheed Martin Corp. have established a strategic alliance officials hope results in a bigger share of the estimated $5 billion airspace automation market.

Going forward, Harris and Lockheed plan to provide integrated solutions on a case-by-case basis, pulling on their varied strengths. The union could amount to doing more business together, although neither party put money behind the deal or committed to partner on future endeavors.

"This alliance combines our expertise in air traffic management with Harris' complementary strengths in communications and weather," Lockheed Martin Air Traffic Management President Don Antonucci said, announcing the agreement Nov. 6 at the Air Traffic Control Association's annual convention.

Lockheed, a large integrator, learned the hard way that Harris, a much smaller company (see box), had skills the aviation community wanted when it was passed over for a procurement potentially worth $3.5 billion.

Harris won the Federal Aviation Administration's Telecommunications Infrastructure (FTI) contract in July. The contract will integrate the management of multiple telecom networks, including satellite and phone services, for air traffic operations and administrative systems that are reaching the end of their useful lives.

For Lockheed, all was not lost. The company subsequently joined the Harris team and, around the same time, snagged its own sizable job.

The FAA awarded Lockheed the first phase of the En Route Automation Modernization contract, following an alternate dispute resolution with Raytheon Co. in June. Potentially worth $1 billion, ERAM will modernize computer hardware and software at the agency's 20 en route centers, which take over after aircraft leave an airport's airspace.

Incidentally, Harris is on Lockheed's team.

"Future airspace management efficiency and safety improvements require solutions that cross traditional technology stovepipes," Antonucci said.

"Our alliance with Harris will provide an important structure to a relationship that has been evolving these past few years," he said. "This agreement puts a formal structure in place that will guide our interaction and makes it easier to discuss business opportunities and share technology perspectives."

Although passenger demand dropped after last year's Sept. 11 terrorist attacks, industry insiders maintain that the numbers will soon bounce back, and the FAA is moving ahead with its 10-year modernization effort. The agency's Operational Evolution Plan, a mix of information technology and other initiatives, outlines a series of steps to expand the capacity of the airspace system by 2010.

Lockheed is on the Harris-led team competing for the FAA's Next Generation Air/Ground Communications (Nexcom) program to upgrade communications between pilots and air traffic controllers.

"Getting together with somebody like Lockheed gives us the chance to go after contracts we normally wouldn't," said Joe Sleiman, director of business development at Harris. "The projects at the FAA and worldwide are getting larger and more encompassing."

But it goes both ways, according to Warren Suss, president of Suss Consulting Inc. "Harris, a much smaller player, was the giant killer on FTI," Suss said. "It has been difficult, over time, for Lockheed to get traction in communications and telecommunications."

Lockheed shuttered its global telecommunications services business in December 2001.

"In some ways, I think, it's a marriage of convenience," Suss said, adding that strategic alliances "are fairly common, but they often don't mean much in the long run."

The merit of hitching a strong partner, alliance or no alliance, remains certain. Time and again, agency officials say they based decisions on contract awards on the composition of a particular team.

Recognizing that trend, officials at Lockheed and Harris hope to get ahead of the curve by exploring joint possibilities early on. "It's really a chance to have the [administrative tasks] out of the way," said Sleighton Meyer, a spokesman for Harris.

In addition to Nexcom, the duo is eyeing a traffic flow management job in Herndon, Va., Sleiman said.

***

Strategic alliance

Lockheed Martin Corp. and Harris Corp. have joined forces to capture a larger share of the air traffic management market.

What do the companies have to offer?

Lockheed: A $24 billion company with facilities in 45 states and business locations in 56 countries and territories, Lockheed has about 125,000 employees. Expertise includes air traffic management — automation, navigation and traffic flow.

Harris: A $1.95 billion company with sales and service locations in 90 countries, Harris employs about 10,000 people. Expertise includes communications and weather.

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