Smithsonian Institution awards $1.78M contract for telecommunication services to Verizon Business Network Services LLC

Contract Overview

Contract Amount: $1,781,844 ($1.8M)

Contractor: Verizon Business Network Services LLC

Awarding Agency: Smithsonian Institution

Start Date: 2021-04-13

End Date: 2026-04-12

Contract Duration: 1,825 days

Daily Burn Rate: $976/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TELECOMMUNICATION SERVICES FROM 4/1/21-9/30/2021.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Smithsonian Institution obligated $1.8 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: TELECOMMUNICATION SERVICES FROM 4/1/21-9/30/2021. Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of 1825 days (5 years) indicates a long-term need for telecommunication services. 3. The fixed-price contract type aims to provide cost certainty for the Smithsonian. 4. The award to Verizon Business Network Services LLC, a known provider, suggests a focus on established capabilities. 5. The contract value of $1.78 million over five years needs benchmarking against similar telecommunication service contracts. 6. The exclusion of sources in the competition type warrants further investigation into the rationale.

Value Assessment

Rating: fair

The total contract value of $1.78 million over five years equates to approximately $356,000 annually. Benchmarking this against similar telecommunication service contracts for large institutions is crucial to assess value for money. Without specific details on the scope of services (e.g., bandwidth, type of connectivity, number of locations), a precise value assessment is difficult. However, the firm fixed-price nature provides budget predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES.' This indicates that while the competition was intended to be open, certain sources were excluded. The number of bidders is not explicitly stated, but the exclusion suggests a potentially narrowed field. This procurement method requires careful justification to ensure fair opportunity and optimal pricing.

Taxpayer Impact: The exclusion of sources, even within an open competition framework, could potentially limit price discovery and may not always yield the most competitive pricing for taxpayers. Transparency regarding the reasons for exclusion is important.

Public Impact

The Smithsonian Institution benefits from reliable telecommunication services essential for its operations, including museums, research facilities, and administrative functions. These services likely support digital infrastructure, visitor connectivity, and internal communication networks across the institution. The geographic impact is primarily within the District of Columbia, where the Smithsonian has a significant presence. The contract supports the workforce by ensuring the necessary technological infrastructure is in place for employees and researchers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'exclusion of sources' in the competition type raises questions about the breadth of competition and potential impact on pricing.
Lack of detailed service scope makes it difficult to benchmark value for money effectively.
The contract's duration could lock the government into specific technologies or pricing structures that may become outdated.

Positive Signals

Awarded through a competitive process, indicating an effort to secure services through market mechanisms.
The firm fixed-price contract provides cost certainty and reduces the risk of cost overruns for the government.
The contractor, Verizon Business Network Services LLC, is a well-established telecommunications provider, suggesting reliability.

Sector Analysis

This contract falls within the Telecommunications Services sector, specifically wired telecommunications carriers. This sector is characterized by significant infrastructure investment and a mix of large established providers and specialized niche players. The market size for government telecommunications services is substantial, driven by the need for secure, reliable, and high-bandwidth connectivity across various agencies. This contract represents a portion of the Smithsonian's overall IT and operational spending.

Small Business Impact

There is no indication that this contract involved small business set-asides. The award to a large telecommunications provider like Verizon Business Network Services LLC suggests that subcontracting opportunities for small businesses might exist, but this is not explicitly detailed in the provided data. Further analysis of subcontracting plans would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Smithsonian Institution's contracting officers and potentially its Office of Inspector General. Transparency regarding the contract's performance metrics and any deviations from the original scope would be key to effective oversight. Regular performance reviews and adherence to the firm fixed-price terms are accountability measures.

Related Government Programs

Federal Telecommunications Services
Information Technology Services
Wired Telecommunications Carriers Contracts
Smithsonian Institution IT Procurement

Risk Flags

Competition Limited by Source Exclusion
Potential for Technological Obsolescence
Lack of Detailed Service Scope for Benchmarking

Frequently Asked Questions

What is this federal contract paying for?

Smithsonian Institution awarded $1.8 million to VERIZON BUSINESS NETWORK SERVICES LLC. TELECOMMUNICATION SERVICES FROM 4/1/21-9/30/2021.

Who is the contractor on this award?

The obligated recipient is VERIZON BUSINESS NETWORK SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Smithsonian Institution (Smithsonian Institution).

What is the total obligated amount?

The obligated amount is $1.8 million.

What is the period of performance?

Start: 2021-04-13. End: 2026-04-12.

What specific telecommunication services are included under this contract, and what are their performance requirements?

The provided data indicates 'TELECOMMUNICATION SERVICES' but does not detail the specific services. These could range from basic internet connectivity and voice services to dedicated high-bandwidth data circuits, VPNs, and managed network services. Performance requirements would typically include metrics such as uptime guarantees (e.g., 99.9% availability), latency, bandwidth, and security protocols. Without the full contract details or statement of work, a precise understanding of the services and their associated performance benchmarks is not possible. This information is critical for assessing the true value and necessity of the contract.

How does the annual cost of $356,000 compare to similar telecommunication contracts awarded by other federal agencies or large cultural institutions?

Benchmarking this contract's annual cost requires comparison with similar procurements for institutions of comparable size and scope. For instance, comparing it to telecommunication contracts for other Smithsonian museums, national archives, or large federal agencies with significant physical footprints and digital operations would be relevant. Factors such as geographic concentration (e.g., single site vs. distributed locations), required bandwidth, and the inclusion of managed services versus basic connectivity will heavily influence price. A preliminary assessment suggests that $356,000 annually for comprehensive telecommunication services for a major institution is within a plausible range, but a detailed market analysis is needed for a definitive conclusion on value for money.

What was the specific justification for excluding certain sources in the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' procurement method?

The justification for excluding sources under this procurement method typically relates to specific technical requirements, existing infrastructure compatibility, or unique service needs that only a limited number of vendors can meet. For telecommunications, this might involve ensuring seamless integration with existing networks, meeting stringent security certifications, or requiring specialized routing capabilities. The Smithsonian Institution would have documented the rationale for these exclusions, likely related to ensuring service continuity, meeting specific performance standards, or leveraging existing vendor relationships where justified. Understanding this rationale is key to assessing whether the exclusion unduly limited competition or was a necessary measure to achieve specific operational goals.

What is Verizon Business Network Services LLC's track record with the Smithsonian Institution and other federal agencies for similar telecommunication services?

Verizon Business Network Services LLC is a major telecommunications provider with extensive experience serving government agencies and large enterprises. Their track record with the Smithsonian Institution would likely involve previous contracts for network infrastructure, connectivity, and related services. Assessing their past performance would involve reviewing contract histories for on-time delivery, adherence to service level agreements, responsiveness to issues, and overall customer satisfaction. Federal procurement databases and past performance reviews (if available) can provide insights into their reliability and capability in delivering complex telecommunication solutions.

What are the potential risks associated with a five-year fixed-price contract for telecommunication services, particularly concerning technological obsolescence?

A significant risk with long-term fixed-price contracts, especially in rapidly evolving sectors like telecommunications, is technological obsolescence. The services and equipment specified at the outset may become outdated or less efficient over the five-year period, while newer, more capable, or cost-effective technologies emerge. This could lead to the Smithsonian paying for services that are no longer state-of-the-art or missing opportunities for upgrades that could improve performance or reduce costs. Mitigation strategies might include contract clauses allowing for technology refreshes or periodic reviews of service offerings.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications Carriers › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: ALTERNATIVE SOURCES

Offers Received: 3

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: $1,781,844

Exercised Options: $1,781,844

Current Obligation: $1,781,844

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: YES

Timeline