Department of Defense awarded $578.6M contract for telecommunications services to Science Applications International Corp
Contract Overview
Contract Amount: $578,632,236 ($578.6M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2002-05-31
End Date: 2015-04-21
Contract Duration: 4,708 days
Daily Burn Rate: $122.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: 200209!000780!9700!ZD11 !DEFENSE INFO. TECHNOLOGY CONTRAC!DCA20002D5001 !A!N! !N!000404 !20020531!20020930!148095086!148095086!054781240!N!SCIENCE APPLICATIONS INTERNATI!10260 CAMPUS POINT DRIVE, !SAN DIEGO !CA!92121!66000!073!06!SAN DIEGO !SAN DIEGO !CALIFORNIA!+000009034065!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !513310!E! !5!B!S!C! !C!20021004!B!F!N!A! !A!U!Y!2!002!B! !Z!N!Z! ! !N!C!N! ! ! !C!C!A!A!000!A!C!N! ! ! !Y! !HC1046!0001!
Place of Performance
Location: FALLS CHURCH, FALLS CHURCH (CITY) County, VIRGINIA, 22040, UNITED STATES OF AMERICA
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $578.6 million to LEIDOS, INC. for work described as: 200209!000780!9700!ZD11 !DEFENSE INFO. TECHNOLOGY CONTRAC!DCA20002D5001 !A!N! !N!000404 !20020531!20020930!148095086!148095086!054781240!N!SCIENCE APPLICATIONS INTERNATI!10260 CAMPUS POINT DRIVE, !SAN DIEGO !CA!92121!66000!073!06!SAN DIEGO !SAN D… Key points: 1. Contract awarded under full and open competition, suggesting a competitive bidding process. 2. The contract's duration of nearly 13 years indicates a long-term need for these services. 3. The significant award amount suggests a substantial requirement for telecommunications infrastructure or support. 4. The contract falls under 'Other ADP & Telecommunication Services', a broad category. 5. The contractor, Science Applications International Corp., is a major player in the defense IT sector. 6. The contract was awarded by the Defense Information Systems Agency (DISA), a key IT provider for the DoD.
Value Assessment
Rating: fair
The total award amount of $578.6 million over a period of approximately 13 years suggests an average annual spend of around $44.5 million. Without specific performance metrics or comparable contract data for similar telecommunications services within the DoD, it is difficult to definitively assess value for money. However, the long duration and substantial funding indicate a significant and ongoing requirement. Benchmarking against industry standards for similar large-scale telecommunications contracts would be necessary for a more precise valuation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The presence of two bids suggests a moderate level of competition for this significant telecommunications services contract. While two bidders is better than one, a higher number of bids would typically lead to more robust price discovery and potentially better pricing for the government.
Taxpayer Impact: A competitive award process, even with two bidders, generally benefits taxpayers by encouraging more favorable pricing compared to sole-source or limited competition scenarios.
Public Impact
The primary beneficiary is the Department of Defense, which receives essential telecommunications services. Services delivered likely include wired telecommunications infrastructure, network support, and related IT services. The geographic impact is likely nationwide, supporting DoD operations across various bases and facilities. Workforce implications may include employment for technical staff, engineers, and support personnel within the contractor's organization.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The long contract duration could lead to vendor lock-in and reduced flexibility for the DoD to adopt newer technologies.
- The substantial award amount raises questions about cost-effectiveness over the entire contract period without detailed performance data.
- The 'Other ADP & Telecommunication Services' category is broad, potentially masking specific service inefficiencies or overcharges.
Positive Signals
- Awarded under full and open competition, indicating a structured and accessible bidding process.
- The contractor, Science Applications International Corp., has a significant track record with government contracts.
- The contract's long-term nature suggests a stable and reliable provision of critical services to the DoD.
Sector Analysis
This contract falls within the Information Technology and Telecommunications sector, specifically focusing on wired telecommunications carriers. The market for telecommunications services for large government entities is substantial, with major players like Leidos (formerly SAIC) and others competing for significant portions of this spending. The DoD represents a large consumer of such services, requiring robust and secure networks to support its global operations. Comparable spending benchmarks would involve analyzing other large-scale telecommunications contracts awarded by federal agencies for similar scope and duration.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'SB: N'. There is no explicit mention of subcontracting plans for small businesses. This suggests that the primary award went to a large business, and the direct impact on the small business ecosystem through this specific contract may be limited unless subcontracting opportunities arise organically.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the Defense Contract Management Agency (DCMA). The contract type (Time and Materials) often requires close monitoring of labor hours and costs. Transparency is generally provided through contract award databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Defense Information Systems Agency (DISA) Contracts
- Wired Telecommunications Services
- Department of Defense IT Spending
- Federal Telecommunications Infrastructure
Risk Flags
- Potential for cost overruns due to Time and Materials contract type.
- Long contract duration may limit adoption of newer technologies.
- Limited competition (two bidders) may have impacted price discovery.
- Broad service category ('Other ADP & Telecommunication Services') could obscure specific cost efficiencies.
Tags
department-of-defense, defense-information-systems-agency, wired-telecommunications-carriers, it-services, time-and-materials, full-and-open-competition, large-contract, science-applications-international-corp, virginia, telecommunications
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $578.6 million to LEIDOS, INC.. 200209!000780!9700!ZD11 !DEFENSE INFO. TECHNOLOGY CONTRAC!DCA20002D5001 !A!N! !N!000404 !20020531!20020930!148095086!148095086!054781240!N!SCIENCE APPLICATIONS INTERNATI!10260 CAMPUS POINT DRIVE, !SAN DIEGO !CA!92121!66000!073!06!SAN DIEGO !SAN DIEGO !CALIFORNIA!+000009034065!N!N!000000000000!D399!OTHER ADP & TELECOMMUNICATION SERVICES !S1 !SERVICES !1000!NOT DISCERNABLE OR CLASSIFIED !513310!E! !5!B!S!C! !C!20021004!B
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $578.6 million.
What is the period of performance?
Start: 2002-05-31. End: 2015-04-21.
What is the track record of Science Applications International Corp. (SAIC) with Department of Defense contracts, particularly in telecommunications?
Science Applications International Corp. (SAIC), now part of Leidos, has a long and extensive history of contracting with the Department of Defense across a wide array of services, including IT, engineering, and telecommunications. Prior to its merger with Leidos, SAIC was a major prime contractor for numerous complex DoD programs. Their experience typically involves large-scale system integration, network management, and support services. For telecommunications, SAIC has been involved in projects ranging from tactical communications to enterprise-level network infrastructure. Their track record generally indicates a capacity to handle large, complex, and long-duration contracts, though specific performance reviews and past performance evaluations would be necessary for a detailed assessment of their success on individual contracts.
How does the $578.6 million award compare to other similar telecommunications contracts awarded by the DoD?
The $578.6 million award for 'Other ADP & Telecommunication Services' over approximately 13 years is a substantial contract, averaging over $44 million annually. This places it among significant federal telecommunications procurements. For context, the DoD frequently awards large contracts for network modernization, satellite communications, and enterprise IT services that can range from tens of millions to billions of dollars. Contracts of this magnitude are typical for supporting the vast infrastructure needs of the military. To provide a precise comparison, one would need to identify contracts with similar scope (wired telecommunications), duration, and service type (e.g., network operations, infrastructure support) awarded by DISA or other DoD components during a comparable timeframe.
What are the primary risks associated with a Time and Materials (T&M) contract of this size and duration?
Time and Materials (T&M) contracts, like this one, carry inherent risks, particularly for large, long-duration awards. The primary risk for the government is cost control, as T&M contracts do not have a ceiling on the total cost. This means the contractor is reimbursed for direct labor hours at specified rates and for the cost of materials. Without robust oversight and detailed reporting, there's a risk of cost overruns if labor hours are not efficiently managed or if material costs are inflated. For a contract spanning nearly 13 years, the risk of escalating labor rates and the potential for scope creep without adequate controls are also significant concerns. The government must diligently monitor performance and costs to ensure value.
How effective is 'full and open competition' in ensuring competitive pricing for large telecommunications contracts?
Full and open competition is generally the most effective method for ensuring competitive pricing in federal contracting. It allows any responsible source to submit an offer, maximizing the pool of potential bidders and fostering a competitive environment. This competition drives down prices as contractors vie for the award. However, the effectiveness can be influenced by the complexity of the requirement and the number of bidders. For highly specialized or technically demanding contracts, the number of capable bidders might be limited, even under full and open competition. In this case, with two bidders, the competition was present but perhaps not as intense as it could have been with more offers, potentially impacting the degree of price reduction achieved.
What is the historical spending pattern for 'Other ADP & Telecommunication Services' by the Department of Defense?
The Department of Defense is consistently one of the largest federal spenders on Information Technology and telecommunications services. The category 'Other ADP & Telecommunication Services' (often associated with NAICS code 517110 for Wired Telecommunications Carriers or similar) represents a significant portion of this spending. Historical data shows a sustained high level of investment in these areas to maintain and modernize the vast communication networks required for military operations globally. Spending in this category fluctuates based on major modernization initiatives, new technology adoption, and evolving operational requirements. Analyzing historical spending trends for this specific NAICS code or broader telecommunications categories within DoD would reveal consistent, substantial outlays reflecting the critical nature of these services.
Industry Classification
NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc. (UEI: 611641312)
Address: 10260 CAMPUS POINT DRIVE,, SAN DIEGO, CA, 92121
Business Categories: Category Business, Not Designated a Small Business
Parent Contract
Parent Award PIID: DCA20002D5001
IDV Type: IDC
Timeline
Start Date: 2002-05-31
Current End Date: 2015-04-21
Potential End Date: 2015-04-21 00:00:00
Last Modified: 2015-05-01
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