Verizon awarded $4.5M contract for wired telecommunications, highlighting a competitive landscape for essential communication services

Contract Overview

Contract Amount: $4,538,662 ($4.5M)

Contractor: Verizon Business Network Services LLC

Awarding Agency: Commodity Futures Trading Commission

Start Date: 2020-10-27

End Date: 2026-09-30

Contract Duration: 2,164 days

Daily Burn Rate: $2.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMUNICATION SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20581

State: District of Columbia Government Spending

Plain-Language Summary

Commodity Futures Trading Commission obligated $4.5 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: COMMUNICATION SERVICES Key points: 1. The contract value represents a significant investment in maintaining robust communication infrastructure. 2. Full and open competition suggests a healthy market with multiple potential providers. 3. The fixed-price contract type offers cost certainty for the agency. 4. The duration of the contract indicates a long-term need for these services. 5. The geographic focus on Washington D.C. aligns with the agency's operational base.

Value Assessment

Rating: good

The contract value of $4.5 million over its period appears reasonable for comprehensive wired telecommunications services in a major metropolitan area. Benchmarking against similar contracts for large federal agencies in Washington D.C. would provide a more precise value-for-money assessment. However, the fixed-price nature of the contract helps mitigate cost overruns, suggesting good financial planning.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. The presence of a single award does not necessarily imply limited competition, as the process itself was open. The competitive bidding process is expected to drive favorable pricing and service terms for the Commodity Futures Trading Commission.

Taxpayer Impact: Taxpayers benefit from the competitive process, which typically leads to more cost-effective solutions and ensures that the government secures services at market-competitive rates.

Public Impact

The Commodity Futures Trading Commission (CFTC) benefits directly through reliable and secure communication services. Essential services include wired telecommunications, supporting daily operations and data transmission. The geographic impact is concentrated in Washington D.C., where the CFTC is headquartered. The contract supports the telecommunications workforce, including technicians and support staff employed by the contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded through full and open competition, suggesting a robust bidding process.
Fixed-price contract type provides cost predictability.
Long contract duration indicates a stable and ongoing need for services.

Sector Analysis

The wired telecommunications sector is a mature industry providing essential infrastructure for businesses and government. This contract falls under the broader telecommunications services market, which is characterized by significant infrastructure investment and technological evolution. Comparable spending benchmarks for federal agencies in the D.C. area for similar services can range widely based on bandwidth, security requirements, and service level agreements, but a $4.5 million award over several years is within a typical range for a mid-sized agency's core communication needs.

Small Business Impact

There is no indication that this contract was specifically set aside for small businesses, nor is there information on subcontracting plans. Given the nature of large-scale telecommunications infrastructure, it is possible that a prime contractor like Verizon may utilize specialized subcontractors, but the extent to which small businesses would be involved is not detailed in the provided data.

Oversight & Accountability

The Commodity Futures Trading Commission, as the contracting agency, is responsible for oversight. The contract's fixed-price nature simplifies some aspects of financial oversight. Transparency is generally maintained through federal procurement databases. Specific accountability measures would be detailed in the contract's statement of work and performance standards, with potential oversight from the agency's Inspector General if performance issues arise.

Related Government Programs

Federal Telecommunications Services
Network Infrastructure Contracts
Government Communications

Risk Flags

Potential vendor lock-in due to single-award contract.
Reliance on a single provider for critical infrastructure.
Need for ongoing performance monitoring to ensure service quality.

Frequently Asked Questions

What is this federal contract paying for?

Commodity Futures Trading Commission awarded $4.5 million to VERIZON BUSINESS NETWORK SERVICES LLC. COMMUNICATION SERVICES

Who is the contractor on this award?

The obligated recipient is VERIZON BUSINESS NETWORK SERVICES LLC.

Which agency awarded this contract?

Awarding agency: Commodity Futures Trading Commission (Commodity Futures Trading Commission).

What is the total obligated amount?

The obligated amount is $4.5 million.

What is the period of performance?

Start: 2020-10-27. End: 2026-09-30.

What is the historical spending pattern for wired telecommunications services by the Commodity Futures Trading Commission?

Analyzing historical spending for wired telecommunications by the CFTC is crucial for understanding trends and justifying current expenditures. Without specific historical data, we can infer that the agency has likely had ongoing needs for such services. The current $4.5 million award over approximately six years suggests an average annual spend of around $750,000. This figure should be compared against previous contract values, the number of contracts awarded, and the specific services provided in prior periods to identify any significant increases or decreases in spending, which could be driven by changes in service scope, technology adoption, or market pricing.

How does the pricing of this Verizon contract compare to similar telecommunications contracts awarded to other vendors or agencies?

Benchmarking the pricing of this $4.5 million contract against similar telecommunications services procured by other federal agencies or even by the CFTC itself in the past is essential for assessing value for money. Factors such as bandwidth, service level agreements (SLAs), geographic coverage, and security features significantly influence pricing. If comparable contracts awarded through full and open competition show lower per-unit costs for similar service levels, it might indicate that this contract's pricing is not optimal. Conversely, if the services are more comprehensive or meet higher security standards, the price may be justified. A detailed analysis would require access to the specific service details and pricing structures of comparable contracts.

What are the specific performance metrics and service level agreements (SLAs) associated with this contract?

The specific performance metrics and SLAs are critical for evaluating the contractor's performance and ensuring the agency receives the contracted value. These metrics typically include uptime guarantees, response times for outages, installation timelines, and customer support availability. For a wired telecommunications contract, key SLAs might focus on network availability (e.g., 99.99% uptime), latency, and data transfer speeds. The contract's duration of over five years suggests that these SLAs are designed to ensure consistent, high-quality service delivery throughout the period. Failure to meet these SLAs would typically trigger penalties or remedies outlined in the contract.

What is Verizon Business Network Services LLC's track record with federal government contracts, particularly for telecommunications services?

Verizon Business Network Services LLC has a substantial track record of serving federal government clients with telecommunications and network solutions. As a major telecommunications provider, they are frequently awarded contracts across various agencies. Their experience typically includes providing a wide range of services, from basic connectivity to complex network integration and cybersecurity solutions. Evaluating their past performance on similar contracts, including adherence to schedules, quality of service, and responsiveness to issues, is important. Federal procurement data often includes past performance ratings, which can provide insights into their reliability and effectiveness as a government contractor.

What are the potential risks associated with relying on a single vendor for critical wired telecommunications infrastructure for an extended period?

Relying on a single vendor like Verizon for critical wired telecommunications infrastructure for over five years presents several potential risks. Vendor lock-in can limit future flexibility and potentially lead to price increases upon contract renewal if competition is not re-established. Dependence on a single provider also concentrates risk; any service disruptions, security breaches, or financial instability on the part of the vendor could have significant operational impacts on the CFTC. Furthermore, technological advancements might occur that are not fully leveraged if the contract doesn't allow for easy integration of new solutions. Mitigating these risks often involves robust contract management, clear performance expectations, and contingency planning.

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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 9523ZY20Q0008

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: $25,153,249

Exercised Options: $6,136,903

Current Obligation: $4,538,662

Actual Outlays: $3,036,668

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