DoD's $53.4M Verizon Contract for Wired Telecom Services: A 3.8-Year Delivery Order Under Full and Open Competition
Contract Overview
Contract Amount: $53,384,083 ($53.4M)
Contractor: Verizon Business Network Services LLC
Awarding Agency: Department of Defense
Start Date: 2017-05-22
End Date: 2021-02-28
Contract Duration: 1,378 days
Daily Burn Rate: $38.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IGF::OT::IGF GNVZ000001EBM
Plain-Language Summary
Department of Defense obligated $53.4 million to VERIZON BUSINESS NETWORK SERVICES LLC for work described as: IGF::OT::IGF GNVZ000001EBM Key points: 1. Significant contract value of $53.4 million awarded to Verizon Business Network Services LLC. 2. Procurement utilized full and open competition, suggesting a competitive bidding process. 3. Contract duration of 1378 days (approx. 3.8 years) indicates a medium-term service requirement. 4. The North American Industry Classification System (NAICS) code 517110 points to wired telecommunications infrastructure.
Value Assessment
Rating: good
The contract value of $53.4 million for wired telecommunications services appears reasonable given the 3.8-year duration and the provider's established market presence. Benchmarking against similar large-scale government telecom contracts would provide a more precise assessment.
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 method is expected to drive competitive pricing and ensure the government receives fair market value.
Taxpayer Impact: The use of full and open competition suggests that taxpayers benefited from a potentially lower price than would have been achieved through sole-source or limited competition.
Public Impact
Ensures critical wired telecommunications infrastructure for the Department of Defense. Supports national security and operational readiness through reliable communication networks. Provides a stable revenue stream for Verizon Business Network Services LLC. Potential for service disruptions if contract performance is not maintained.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in if follow-on contracts are not competitively bid.
- Reliance on a single vendor for critical infrastructure.
- Cybersecurity risks associated with telecommunications networks.
Positive Signals
- Awarded under full and open competition.
- Long-term contract provides stability for service delivery.
- Established provider with a track record in the industry.
Sector Analysis
This contract falls within the IT and Telecommunications sector, specifically wired telecommunications carriers. Spending in this area is crucial for government operations, supporting everything from internal communications to mission-critical systems. Benchmarks for similar contracts vary widely based on scope and duration.
Small Business Impact
The data does not indicate any specific set-asides for small businesses. The award to a large corporation like Verizon suggests that small businesses were likely not primary contractors on this specific delivery order, though they may be subcontractors.
Oversight & Accountability
The contract was awarded by the Defense Information Systems Agency (DISA), a component of the Department of Defense, implying oversight from within the agency. Further oversight would typically involve performance reviews and audits to ensure compliance and value.
Related Government Programs
- Wired Telecommunications Carriers
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Potential for vendor lock-in.
- Cybersecurity vulnerabilities.
- Reliance on a single provider for critical infrastructure.
- Lack of small business participation noted.
Tags
wired-telecommunications-carriers, department-of-defense, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $53.4 million to VERIZON BUSINESS NETWORK SERVICES LLC. IGF::OT::IGF GNVZ000001EBM
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 $53.4 million.
What is the period of performance?
Start: 2017-05-22. End: 2021-02-28.
What specific telecommunications services are included in this $53.4 million contract, and how do they align with DISA's current and future mission requirements?
The contract covers wired telecommunications services under NAICS code 517110. While the specific services aren't detailed, this typically includes the provision and maintenance of network infrastructure like fiber optic lines, Ethernet, and related support. For DISA, these services are fundamental for secure and reliable data transmission supporting military operations, intelligence sharing, and administrative functions, ensuring connectivity across various command centers and deployed units.
Given the 3.8-year duration and $53.4M value, what is the estimated per-unit cost, and how does it compare to industry benchmarks for similar government telecommunications services?
The average annual cost is approximately $14 million ($53.4M / 3.8 years). The per-unit cost is difficult to ascertain without knowing the number of circuits, bandwidth, or locations served. However, this annual figure appears within a reasonable range for large-scale enterprise telecommunications services provided to a major federal agency, though a detailed benchmark analysis against specific service level agreements would be needed for a definitive assessment.
What measures are in place to ensure the cybersecurity of the wired telecommunications network provided by Verizon, and what are the potential risks if these measures are breached?
Government contracts, especially with the Department of Defense, typically mandate strict cybersecurity protocols, compliance with NIST standards, and regular security audits. Verizon, as a major provider, has its own robust security measures. A breach could compromise sensitive military communications, classified data, and operational command and control systems, leading to significant national security risks and potential mission failure.
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
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, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $53,384,083
Exercised Options: $53,384,083
Current Obligation: $53,384,083
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC101316D0008
IDV Type: IDC
Timeline
Start Date: 2017-05-22
Current End Date: 2021-02-28
Potential End Date: 2021-02-28 00:00:00
Last Modified: 2021-01-28
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