DoD's $441M contract for wired telecommunications services awarded to Northrop Grumman Information Technology Inc

Contract Overview

Contract Amount: $441,297,260 ($441.3M)

Contractor: Northrop Grumman Information Technology Inc

Awarding Agency: Department of Defense

Start Date: 2007-03-05

End Date: 2012-09-30

Contract Duration: 2,036 days

Daily Burn Rate: $216.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SERVICES--DKO CONCEPT OF OPERATIONS

Place of Performance

Location: FORT BELVOIR, FAIRFAX County, VIRGINIA, 22060

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $441.3 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: SERVICES--DKO CONCEPT OF OPERATIONS Key points: 1. The contract value of over $441 million represents a significant investment in telecommunications infrastructure. 2. Awarded under full and open competition, suggesting a robust market for these services. 3. The duration of the contract (over 5 years) indicates a long-term need for these telecommunications capabilities. 4. The contract type (firm fixed price) aims to provide cost certainty for the government. 5. Northrop Grumman's extensive experience in defense contracting positions them as a capable provider. 6. The contract's focus on wired telecommunications aligns with essential communication needs for military operations.

Value Assessment

Rating: good

Benchmarking the value of this contract requires detailed analysis of telecommunications service costs during the 2007-2012 period. Given the scale and duration, the $441 million figure appears to be within a reasonable range for comprehensive wired telecommunications infrastructure and services for a major defense agency. The firm fixed-price structure suggests an effort to control costs, though the ultimate value-for-money depends on the quality and reliability of services delivered over the contract's life.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple vendors were likely invited to bid. The presence of a competitive bidding process generally leads to better price discovery and potentially more favorable terms for the government. The fact that it was competed openly suggests that the market for these services is sufficiently developed to support multiple capable providers.

Taxpayer Impact: Taxpayers benefit from full and open competition through potentially lower prices and a wider selection of qualified vendors, ensuring that the government secures services at competitive market rates.

Public Impact

The Department of the Army benefits from enhanced and reliable wired telecommunications services, crucial for command and control, intelligence, and operational readiness. This contract supports the delivery of essential communication infrastructure, enabling seamless data transfer and voice communication across various military installations. The geographic impact is likely widespread, covering numerous Army facilities and operational areas requiring robust wired networks. The contract supports a significant number of jobs within the telecommunications and IT sectors, both directly with the prime contractor and indirectly through subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if specific proprietary technologies are implemented.
Risk of cost overruns if scope creep occurs despite firm fixed-price structure.
Dependence on contractor performance for critical communication uptime.

Positive Signals

Awarded through full and open competition, indicating market availability and competitive pricing.
Firm fixed-price contract type provides cost predictability for the government.
Long contract duration suggests a stable, long-term requirement met by a single award.
Northrop Grumman's established presence and experience in defense IT.

Sector Analysis

This contract falls within the telecommunications services sector, specifically focusing on wired infrastructure. The market for such services is characterized by large, established providers and significant infrastructure investment. The $441 million award is substantial, reflecting the critical nature of reliable telecommunications for a major government agency like the Department of Defense. Comparable spending benchmarks would involve analyzing other large-scale government or enterprise contracts for network infrastructure and managed telecommunications services.

Small Business Impact

The contract details do not indicate any specific small business set-asides. However, as a large prime contract awarded through full and open competition, there is potential for significant subcontracting opportunities for small businesses within the telecommunications and IT support ecosystem. The prime contractor's subcontracting plan would be crucial in determining the extent of small business participation.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Army. Accountability measures are embedded in the firm fixed-price contract terms, with penalties or remedies for non-performance. Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics may be proprietary.

Related Government Programs

Defense Information Systems Agency (DISA) telecommunications contracts
General Services Administration (GSA) Federal Telecommunications Services (FTS) contracts
Department of Defense Enterprise IT contracts
Wired Network Infrastructure Services

Risk Flags

Contract Duration
Contract Value
Competition Type

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $441.3 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. SERVICES--DKO CONCEPT OF OPERATIONS

Who is the contractor on this award?

The obligated recipient is NORTHROP GRUMMAN INFORMATION TECHNOLOGY 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 $441.3 million.

What is the period of performance?

Start: 2007-03-05. End: 2012-09-30.

What was the specific scope of services provided under this contract?

This contract, valued at approximately $441 million, was for the 'DKO CONCEPT OF OPERATIONS' services, primarily related to wired telecommunications. While the specific details of the 'DKO Concept of Operations' are not fully elaborated in the provided data, it generally implies the provision, maintenance, and management of wired telecommunications infrastructure and services. This would likely encompass network design, installation, operation, and support for voice and data communications, ensuring reliable connectivity for Department of the Army operations. The contract's duration of over five years suggests a comprehensive, long-term requirement for these essential communication capabilities.

How does the contract value compare to similar telecommunications contracts awarded by the DoD during that period?

Comparing the $441 million value requires context of the specific telecommunications services procured and the prevailing market rates between 2007 and 2012. Large-scale wired telecommunications contracts for major government agencies often run into hundreds of millions of dollars due to the extensive infrastructure, equipment, and ongoing support required. For instance, similar multi-year contracts for enterprise-wide network modernization or managed telecommunications services for other branches of the DoD or federal agencies could also be in this range. Without specific benchmarks for 'DKO Concept of Operations' services, it's challenging to provide a precise comparison, but the award size is consistent with significant, long-term telecommunications investments by large federal entities.

What were the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not explicitly detail the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for a firm fixed-price contract of this magnitude concerning wired telecommunications for the Department of the Army, typical SLAs would likely focus on network uptime, latency, bandwidth availability, mean time to repair (MTTR) for outages, and security compliance. Performance would be monitored by the contracting officer's representative (COR) to ensure adherence to the contract's technical requirements and operational objectives. Failure to meet critical SLAs could result in penalties or contract remedies, even under a fixed-price structure.

What is Northrop Grumman Information Technology Inc.'s track record with similar DoD contracts?

Northrop Grumman Information Technology Inc. (now part of Northrop Grumman Corporation) has a long and extensive history of providing IT and telecommunications services to the Department of Defense and other federal agencies. They have been a major contractor for complex systems integration, network operations, cybersecurity, and communication solutions. Their track record includes numerous large-scale contracts across various military branches, demonstrating significant experience in managing complex projects, meeting stringent security requirements, and delivering critical infrastructure. This specific contract aligns with their core competencies in defense IT and communications.

Were there any significant challenges or disputes during the performance of this contract?

The provided summary data does not contain information regarding specific challenges or disputes encountered during the performance of this contract. Contract performance issues, disputes, or modifications are typically documented in more detailed contract management records, agency procurement databases, or legal filings if they escalate. Without access to such records, it is not possible to ascertain if any significant challenges arose during the contract's execution from 2007 to 2012.

How did the 'full and open competition' process impact the final pricing and vendor selection?

The 'full and open competition' award strategy implies that the Department of the Army solicited proposals from all responsible sources capable of meeting the stated requirements. This process typically involves a detailed Request for Proposal (RFP) outlining technical, performance, and cost expectations. By allowing any qualified vendor to compete, the government aimed to foster a competitive environment, driving down prices through multiple bids and encouraging innovative solutions. The selection would have been based on a combination of factors, likely including technical merit, past performance, and price, with the goal of achieving the best overall value for the taxpayer.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Northrop Grumman Corporation (UEI: 967356127)

Address: 7575 COLSHIRE DRIVE, MCLEAN, VA, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $460,627,561

Exercised Options: $441,655,304

Current Obligation: $441,297,260

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA877104D0004

IDV Type: IDC

Timeline