NIST awards $11.26M telecommunication services contract to Verizon Business Network Services LLC

Contract Overview

Contract Amount: $11,261,317 ($11.3M)

Contractor: Verizon Business Network Services LLC

Awarding Agency: Department of Commerce

Start Date: 2021-08-31

End Date: 2026-05-31

Contract Duration: 1,734 days

Daily Burn Rate: $6.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NIST TELECOMMUNICATION SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20230

State: District of Columbia Government Spending

Plain-Language Summary

Department of Commerce obligated $11.3 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: NIST TELECOMMUNICATION SERVICES Key points: 1. Contract value of $11.26 million over its duration. 2. Awarded under full and open competition. 3. Contract type is Firm Fixed Price. 4. Services provided by a single vendor, Verizon Business Network Services LLC. 5. Duration of the contract is 1734 days. 6. The contract is for wired telecommunications carriers. 7. Located in Washington D.C.

Value Assessment

Rating: good

The contract value of $11.26 million for telecommunication services over approximately 4.75 years appears reasonable given the scope of services for a federal agency. Benchmarking against similar large-scale telecommunication contracts for federal entities would provide a more precise value-for-money assessment. The firm fixed-price structure suggests that the government has a clear understanding of the costs involved, which can help control spending.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process is generally expected to yield better pricing and service options for the government. The fact that it was competed openly suggests a healthy market for these telecommunication services.

Taxpayer Impact: Full and open competition typically benefits taxpayers by driving down prices through market forces and ensuring the government receives the best value for its investment.

Public Impact

NIST benefits from reliable telecommunication services essential for its operations. Supports the functioning of a key federal research and standards agency. Services are delivered within the District of Columbia. Ensures continued connectivity for NIST personnel and data transfer.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded through full and open competition, suggesting a competitive bidding process.
Firm Fixed Price contract type helps in budget predictability.
Long-term duration (over 4 years) can indicate stability and potentially better negotiated rates.
Vendor is a well-established telecommunications provider.

Sector Analysis

This contract falls within the IT and Telecommunications sector, specifically for wired telecommunications carriers. The market for such services is mature, with several large providers capable of meeting federal requirements. Federal spending in this category is substantial, supporting agency operations nationwide. This contract represents a portion of NIST's overall IT infrastructure investment.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. Further analysis would be needed to determine if small businesses are involved in the supply chain or if there were opportunities missed for small business participation.

Oversight & Accountability

The contract is subject to standard federal procurement oversight. The firm fixed-price nature provides a degree of financial oversight. Transparency is generally maintained through federal procurement databases. The specific oversight mechanisms and accountability measures would be detailed in the contract itself and managed by the contracting officer at the Department of Commerce.

Related Government Programs

NIST Information Technology Services
Federal Telecommunications Infrastructure
Wired Network Services
Department of Commerce IT Contracts

Risk Flags

Potential for vendor lock-in
Reliance on a single provider for critical infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $11.3 million to VERIZON BUSINESS NETWORK SERVICES LLC. NIST TELECOMMUNICATION SERVICES

Who is the contractor on this award?

The obligated recipient is VERIZON BUSINESS NETWORK SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Department of Commerce (Office of the Secretary).

What is the total obligated amount?

The obligated amount is $11.3 million.

What is the period of performance?

Start: 2021-08-31. End: 2026-05-31.

What is the historical spending by NIST on telecommunication services?

Historical spending data for NIST on telecommunication services prior to this contract would provide valuable context for assessing the $11.26 million award. Analyzing trends in spending, vendor choices, and contract durations over the past 5-10 years can reveal patterns of investment, potential cost efficiencies or escalations, and the agency's reliance on external providers. Without specific historical data, it is difficult to determine if this award represents an increase, decrease, or stable level of spending for NIST's telecommunication needs. Understanding past expenditures is crucial for evaluating the long-term financial commitment and strategic importance of this contract within NIST's budget.

How does the per-unit cost of this contract compare to similar federal telecommunication contracts?

Benchmarking the per-unit cost of this $11.26 million contract against similar federal telecommunication services contracts is essential for a thorough value-for-money assessment. This would involve comparing metrics such as cost per line, cost per megabit of bandwidth, or cost per user, depending on the specific services procured. If comparable contracts awarded through full and open competition show significantly lower per-unit costs, it might indicate that NIST could have negotiated a better price or that market conditions have changed. Conversely, if the costs are in line or lower, it suggests the pricing is competitive. Access to a comprehensive database of federal contract pricing is necessary for such a comparison.

What are the specific telecommunication services covered under this contract?

The contract identifies the North American Industry Classification System (NAICS) code 517110 as 'Wired Telecommunications Carriers.' This typically encompasses services such as dedicated internet access, private lines, voice services (POTS, VoIP), and potentially data transmission services delivered over physical wired infrastructure. However, the precise scope of services, including bandwidth levels, service level agreements (SLAs), geographic coverage, and any included equipment or maintenance, would be detailed in the contract's statement of work. Understanding these specifics is critical for evaluating the contract's utility and ensuring it meets NIST's operational requirements effectively.

What is Verizon Business Network Services LLC's track record with federal telecommunication contracts?

Verizon Business Network Services LLC is a major telecommunications provider with a significant history of serving federal agencies. Their track record typically includes numerous contracts for a wide range of services, from basic connectivity to complex network solutions. Assessing their performance on past federal contracts, including on-time delivery, adherence to SLAs, customer satisfaction, and any history of disputes or contract modifications, would provide insight into their reliability and capability. Agencies often consider a vendor's past performance when awarding new contracts, as it serves as a key indicator of future success and risk mitigation.

What are the potential risks associated with a single vendor providing these critical telecommunication services?

The primary risk associated with a single vendor, even one as established as Verizon, is vendor lock-in and potential over-reliance. If service disruptions occur, or if pricing increases significantly upon renewal, NIST may have limited immediate alternatives due to the specialized nature of integrated telecommunication systems. Furthermore, a single point of failure, though unlikely with robust providers, could have widespread impacts on NIST's operations. Mitigation strategies often include strong contract management, clear performance metrics, and contingency planning, but the inherent risk of sole-vendor dependency remains a consideration.

How does this contract align with NIST's overall IT modernization or infrastructure goals?

This contract for wired telecommunication services is fundamental to NIST's IT infrastructure. Its alignment with modernization goals depends on whether the services procured support advanced capabilities like increased bandwidth for data-intensive research, enhanced cybersecurity features, or integration with cloud services. If the contract provides the foundational network capacity needed for future upgrades and digital transformation initiatives, it aligns well. Conversely, if it locks NIST into legacy technologies or insufficient capacity, it could hinder modernization efforts. A review of NIST's strategic IT plans would clarify this alignment.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Verizon Maryland LLC

Address: 22001 LOUDOUN COUNTY PKWY, ASHBURN, VA, 20147

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $11,261,317

Exercised Options: $11,261,317

Current Obligation: $11,261,317

Actual Outlays: $574,316

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q17NSD3009

IDV Type: IDC

Timeline