DoD's $27.5M Verizon Contract for Wired Telecom Services: A 5-Year Delivery Order Under Full and Open Competition
Contract Overview
Contract Amount: $27,499,315 ($27.5M)
Contractor: Verizon Business Network Services LLC
Awarding Agency: Department of Defense
Start Date: 2011-03-01
End Date: 2016-03-27
Contract Duration: 1,853 days
Daily Burn Rate: $14.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: VZBZ000363EBM
Place of Performance
Location: ASHBURN, LOUDOUN County, VIRGINIA, 20147
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $27.5 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: VZBZ000363EBM Key points: 1. The contract awarded to Verizon Business Network Services LLC for wired telecommunications carriers represents a significant investment in defense communication infrastructure. 2. Full and open competition was utilized, suggesting a robust process for selecting the most advantageous offer. 3. The contract duration of 1853 days (approximately 5 years) indicates a long-term need for these services. 4. The fixed-price contract type aims to provide cost certainty for the government.
Value Assessment
Rating: good
The contract's firm fixed price structure provides cost predictability. Benchmarking against similar large-scale telecommunications contracts is necessary for a definitive value assessment, but the competitive award suggests a reasonable price was achieved.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The use of full and open competition indicates that multiple vendors were likely solicited, allowing for price discovery and selection of the best value. This method generally leads to more competitive pricing.
Taxpayer Impact: The competitive nature of the award is expected to have resulted in a fair price, maximizing the value of taxpayer funds spent on essential communication services.
Public Impact
Ensures reliable communication infrastructure for Department of Defense operations. Supports national security by providing critical network services. The long-term nature of the contract provides stability for service provision. Potential for technological advancements within the contracted services over the contract period.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in due to long-term contract.
- Reliance on a single vendor for critical infrastructure.
Positive Signals
- Competitive award process.
- Firm fixed-price contract for cost control.
- Long-term service provision for stability.
Sector Analysis
The contract falls under the Wired Telecommunications Carriers sector, a critical component of IT infrastructure. Spending in this sector for government agencies is substantial, supporting everything from basic connectivity to advanced network solutions.
Small Business Impact
The contract was awarded to a large business (Verizon Business Network Services LLC) and there is no indication of small business participation in this specific award. Opportunities for small businesses may exist further down the supply chain or in other related contracts.
Oversight & Accountability
The award was made under a Delivery Order, suggesting it is part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework. Oversight would typically involve monitoring performance, adherence to terms, and financial management by the Defense Information Systems Agency.
Related Government Programs
- Wired Telecommunications Carriers
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Potential for technological obsolescence over contract life.
- Reliance on a single vendor for critical infrastructure.
- Lack of explicit small business participation noted.
- Contract duration may not align with rapid technological shifts.
Tags
wired-telecommunications-carriers, department-of-defense, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $27.5 million to VERIZON BUSINESS NETWORK SERVICES LLC. VZBZ000363EBM
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 Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $27.5 million.
What is the period of performance?
Start: 2011-03-01. End: 2016-03-27.
What specific telecommunications services are included in this contract, and how do they align with current and future DoD technological requirements?
The contract specifies wired telecommunications carrier services, which broadly encompass the provision and maintenance of physical network infrastructure like fiber optics and copper lines. While the data doesn't detail specific services, these are fundamental for secure and reliable data transmission. Alignment with future needs would depend on the contract's flexibility for upgrades and integration of newer technologies, which should be assessed through contract modifications or future solicitations.
Given the 5-year duration, what are the potential risks associated with technological obsolescence or the emergence of superior, more cost-effective solutions?
A 5-year term carries a moderate risk of technological obsolescence, especially in the rapidly evolving telecom sector. While the firm fixed price provides current cost certainty, it might limit the adoption of newer, potentially more efficient technologies if not managed proactively. The government should monitor market advancements and consider options for early termination or modification if significantly better alternatives emerge.
How effectively did the 'full and open competition' process ensure the government received the best possible value compared to other contracting methods?
Full and open competition is generally considered the most effective method for ensuring best value, as it maximizes the pool of potential bidders and fosters price competition. The fact that this method was chosen suggests the agency believed it would yield the most advantageous outcome. Evaluating the number of bids received and the final negotiated price against market benchmarks would provide a clearer picture of its success in this instance.
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: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Verizon Communications Inc (UEI: 107212169)
Address: 22001 LOUDOUN COUNTY PKWY, ASHBURN, VA, 20147
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $27,499,315
Exercised Options: $27,499,315
Current Obligation: $27,499,315
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC101909D2000
IDV Type: IDC
Timeline
Start Date: 2011-03-01
Current End Date: 2016-03-27
Potential End Date: 2016-03-27 00:00:00
Last Modified: 2019-05-02
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