DoD's $84.8M contract for communications equipment awarded to Motorola Solutions, Inc. shows fair competition

Contract Overview

Contract Amount: $84,839,558 ($84.8M)

Contractor: Motorola Solutions, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-12-10

End Date: 2007-12-31

Contract Duration: 1,482 days

Daily Burn Rate: $57.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200403!000652!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0701DH806 !A!N! !N!0155 ! !20031210!20110927!069373090!005527247!001325463!N!MOTOROLA, INC !7031 COLUMBIA GATEWAY DRIV!COLUMBIA !MD!21046!36650!003!24!HANOVER !ANNE ARUNDEL !MARYLAND !+000005697730!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !5!B!M! !A! !99990909!B! ! !A! !A!N!J!2!007!B! !Z!N!Z! ! !Y!C!N! ! ! !Z!Z!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: COLUMBIA, HOWARD County, MARYLAND, 21046

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $84.8 million to MOTOROLA SOLUTIONS, INC. for work described as: 200403!000652!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0701DH806 !A!N! !N!0155 ! !20031210!20110927!069373090!005527247!001325463!N!MOTOROLA, INC !7031 COLUMBIA GATEWAY DRIV!COLUMBIA !MD!21046!36650!003!24!HANOVER !ANNE… Key points: 1. The contract was awarded under full and open competition, indicating a competitive bidding process. 2. The contract's duration of over 4 years suggests a significant, long-term need for the equipment. 3. The award to Motorola Solutions, Inc. positions them as a key supplier in the defense communications sector. 4. The North American Industry Classification System (NAICS) code 334290 points to a specialized manufacturing segment. 5. The contract's firm fixed price structure aims to control costs and provide budget certainty. 6. The relatively low number of bids (7) might warrant further investigation into market dynamics.

Value Assessment

Rating: fair

The total award amount of $84.8 million for miscellaneous communication equipment over a period of approximately 4 years appears to be within a reasonable range for a Department of Defense contract of this nature. Benchmarking against similar contracts for communication equipment is challenging without more specific details on the exact nature of the equipment and its technical specifications. However, the firm fixed-price contract type suggests an effort to manage costs effectively. The number of bids received (7) indicates some level of competition, but a more in-depth analysis would be needed to determine if this resulted in optimal pricing for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning that all responsible sources were permitted to submit a bid. The solicitation resulted in 7 bids being received. While 7 bidders suggest a degree of market interest, it is not exceptionally high for a contract of this value. The level of competition is generally positive for price discovery, as it encourages bidders to offer competitive pricing to secure the award. However, further analysis could explore if the market could support more bidders or if specific requirements limited participation.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it aims to secure the best possible price through market forces. A competitive environment generally leads to lower costs compared to sole-source or limited competition awards.

Public Impact

The primary beneficiaries of this contract are the U.S. Army, which will receive advanced communication equipment. The contract ensures the delivery of miscellaneous communication equipment, crucial for military operations and command and control. The geographic impact is primarily within the United States, supporting domestic defense manufacturing and supply chains. The contract supports jobs within the defense manufacturing and electronics sector, particularly at Motorola Solutions, Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The number of bids (7) could indicate potential barriers to entry or limited market saturation for this specific type of communication equipment.
Further investigation into the specific technical requirements might reveal if they inadvertently limited the pool of potential bidders.
The contract's duration could lead to vendor lock-in if not managed carefully with performance reviews.

Positive Signals

Awarded under full and open competition, maximizing potential for competitive pricing.
Firm fixed-price contract type provides cost certainty for the government.
Motorola Solutions, Inc. is an established entity in the communications sector, suggesting a degree of reliability.
The contract duration of over 4 years indicates a sustained need and potential for long-term strategic value.

Sector Analysis

The defense communications equipment sector is a critical component of national security, involving specialized manufacturing and technology. This contract falls under the broader category of electronics and communication equipment manufacturing, with NAICS code 334290. The market is characterized by high barriers to entry due to technological complexity, stringent quality requirements, and significant R&D investment. Spending in this sector by the Department of Defense is substantial, driven by the need for secure, reliable, and advanced communication systems to support global operations. Comparable spending benchmarks would typically involve analyzing other large-scale contracts for tactical radios, satellite communication systems, or network infrastructure for military applications.

Small Business Impact

This contract does not appear to have a specific small business set-aside component, as indicated by the 'SB' field being 'N'. The prime contractor, Motorola Solutions, Inc., is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal unless Motorola Solutions actively engages small businesses in its subcontracting efforts.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Army's contracting and program management offices. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods. Transparency is facilitated by the contract award data being publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract execution.

Related Government Programs

Department of Defense Communications Systems
Army Tactical Communications
Electronics and Communication Equipment Manufacturing
Federal Information Technology Contracts

Risk Flags

Potential for limited competition despite full and open award.
Lack of detailed technical specifications hinders in-depth value analysis.
Need for further review of small business subcontracting opportunities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $84.8 million to MOTOROLA SOLUTIONS, INC.. 200403!000652!2100!W15P7T!USA COMMUNICATIONS-ELECTRONICS !DAAB0701DH806 !A!N! !N!0155 ! !20031210!20110927!069373090!005527247!001325463!N!MOTOROLA, INC !7031 COLUMBIA GATEWAY DRIV!COLUMBIA !MD!21046!36650!003!24!HANOVER !ANNE ARUNDEL !MARYLAND !+000005697730!N!N!000000000000!5895!MISCELLANEOUS COMMUNICATION EQUIPMENT !A7 !ELECTRONICS AND COMMUNICATION EQUIP !000 !* !334290!E! !5!B!M! !A! !999

Who is the contractor on this award?

The obligated recipient is MOTOROLA SOLUTIONS, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $84.8 million.

What is the period of performance?

Start: 2003-12-10. End: 2007-12-31.

What is the specific type of 'Miscellaneous Communication Equipment' procured under this contract, and what are its key technical specifications?

The provided data identifies the product service code (PSC) as 5895, which corresponds to 'MISCELLANEOUS COMMUNICATION EQUIPMENT'. However, the data does not specify the exact nature or technical specifications of this equipment. This category can encompass a wide range of items, from tactical radios and encrypted communication devices to specialized network components. Without further details from the contract's statement of work or technical exhibits, it is impossible to determine the precise capabilities or intended use of the procured equipment. Understanding these specifics is crucial for a thorough value assessment and for comparing this contract to others in the defense sector.

How does the per-unit cost of this equipment compare to similar commercially available or government-procured items?

The provided data does not include per-unit cost information or the quantity of items procured, making a direct per-unit cost comparison impossible. The total award value is $84.8 million over a period of approximately 4 years. To perform a per-unit cost analysis, one would need the total number of units purchased and the total value associated with those units. Without this granular data, it's difficult to benchmark the pricing against commercial equivalents or other government contracts. The firm fixed-price nature of the contract suggests that the price was agreed upon upfront, but the value proposition hinges on the quantity and quality of the equipment received relative to that price.

What is Motorola Solutions, Inc.'s track record with Department of Defense contracts, particularly for communication equipment?

Motorola Solutions, Inc. (and its predecessor entities) has a long history of supplying communication equipment to various government agencies, including the Department of Defense. They are known for providing a range of solutions, from public safety radios to tactical communication systems. While this specific contract award of $84.8 million indicates a significant engagement with the Army, a comprehensive track record analysis would involve reviewing their performance on past DoD contracts, including delivery timeliness, product reliability, and adherence to specifications. Their established presence suggests a level of experience, but individual contract performance can vary.

What is the historical spending trend for 'Miscellaneous Communication Equipment' (NAICS 334290) by the Department of the Army over the last five years?

The provided data focuses on a single contract award. To analyze historical spending trends for 'Miscellaneous Communication Equipment' (NAICS 334290) by the Department of the Army, one would need access to comprehensive federal procurement databases covering multiple fiscal years. This would involve querying databases like FPDS or USAspending for all contracts awarded under this NAICS code by the Army. Such an analysis would reveal the total annual spending, identify major contractors, and highlight any fluctuations or patterns in procurement volume and value, providing context for the $84.8 million award in question.

What are the potential risks associated with relying on a single large contractor like Motorola Solutions for a significant portion of communication equipment needs?

Relying heavily on a single large contractor can introduce several risks. These include potential vendor lock-in, where the government becomes dependent on one supplier, potentially limiting future flexibility and negotiation power. There's also the risk of supply chain disruptions if the contractor faces production issues, financial instability, or geopolitical challenges. Furthermore, a lack of robust competition over time could lead to complacency and potentially higher prices in subsequent contracts. To mitigate these risks, the government often employs strategies like maintaining multiple vendor relationships, encouraging competition through contract structuring, and closely monitoring contractor performance and market dynamics.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Other Communications Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 7230 PARKWAY DR, HANOVER, MD, 03

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DAAB0701DH806

IDV Type: IDC

Timeline