DoD's $12.7M purchase of telecommunications equipment from Northrop Grumman Information Technology Inc. awarded under full and open competition

Contract Overview

Contract Amount: $12,713,263 ($12.7M)

Contractor: Northrop Grumman Information Technology Inc

Awarding Agency: Department of Defense

Start Date: 2006-10-18

End Date: 2010-04-17

Contract Duration: 1,277 days

Daily Burn Rate: $10.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PURCHASE MATERIAL & EQUIPMENT

Place of Performance

Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31098

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $12.7 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC for work described as: PURCHASE MATERIAL & EQUIPMENT Key points: 1. The contract value of $12.7 million for telecommunications equipment represents a significant investment in network infrastructure. 2. Awarded to a large, established defense contractor, this contract suggests a focus on reliable, high-capacity solutions. 3. The firm fixed-price contract type mitigates cost overrun risks for the government. 4. The duration of over three years indicates a substantial, ongoing need for these materials and equipment. 5. The contract's classification as 'GA' (General Services Administration) suggests it may leverage existing GSA schedules for efficiency. 6. The absence of small business set-aside flags indicates this was not specifically targeted for smaller enterprises.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific details on the 'material & equipment' purchased. However, $12.7 million for telecommunications infrastructure over three years is a substantial sum. Given the award to a large contractor like Northrop Grumman, the pricing is likely competitive within the enterprise-level solutions market. Further analysis would require understanding the specific components and their market prices at the time of award.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit bids. This approach generally fosters a competitive environment, potentially leading to better pricing and innovation. The presence of 4 bids suggests a reasonable level of interest, though more bidders could have potentially driven prices lower.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it maximizes the pool of potential offerors, increasing the likelihood of receiving competitive pricing and innovative solutions, thereby optimizing the use of public funds.

Public Impact

The Department of the Air Force benefits from upgraded or maintained telecommunications capabilities, crucial for operational readiness and communication. This contract supports the delivery of essential wired telecommunications infrastructure, likely impacting military communication networks. The geographic impact is likely focused on military installations where these telecommunications services are deployed. The contract supports jobs within Northrop Grumman Information Technology Inc. and its supply chain, particularly in the telecommunications equipment sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the 'material & equipment' purchased makes it difficult to assess if the best value was obtained.
The contract's age (awarded in 2006) means current market conditions and technological advancements may not be reflected.
Reliance on a single large contractor for a significant portion of telecommunications equipment could pose supply chain risks if not managed carefully.

Positive Signals

Awarded through full and open competition, suggesting a competitive bidding process.
Firm fixed-price contract type helps control costs and provides budget certainty.
The contract duration of over three years indicates a sustained need and commitment to the procured services/equipment.

Sector Analysis

This contract falls within the telecommunications sector, specifically wired telecommunications carriers (NAICS 517110). This industry is characterized by significant infrastructure investment, technological evolution, and a mix of large established players and specialized service providers. The market size for government telecommunications contracts is substantial, driven by the need for secure and reliable communication networks across various agencies. This contract likely represents a component of the Department of Defense's broader strategy to modernize or maintain its communication infrastructure.

Small Business Impact

The data indicates this contract was not awarded as a small business set-aside (sb: false). Furthermore, the 'ss' (small business set-aside) field is false, and the 'sb' (small business) field is also false. This suggests that small businesses were not specifically targeted for this procurement. While Northrop Grumman Information Technology Inc. is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors, depending on the specific requirements and subcontracting plans, which are not detailed here.

Oversight & Accountability

The contract was awarded by the Department of the Air Force, a component of the Department of Defense. Oversight would typically be managed by contracting officers and program managers within the Air Force. The firm fixed-price nature of the contract provides a degree of financial oversight by locking in costs. Transparency is generally facilitated through contract award databases like FPDS, where this information is available. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Communications Systems
Network Infrastructure Modernization
Telecommunications Services Procurement
Information Technology Equipment Purchases

Risk Flags

Contract awarded in 2006, potentially outdated technology.
Lack of specific equipment details hinders value assessment.
Potential for vendor lock-in with a large prime contractor.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.7 million to NORTHROP GRUMMAN INFORMATION TECHNOLOGY INC. PURCHASE MATERIAL & EQUIPMENT

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 Air Force).

What is the total obligated amount?

The obligated amount is $12.7 million.

What is the period of performance?

Start: 2006-10-18. End: 2010-04-17.

What specific types of telecommunications material and equipment were purchased under this contract?

The provided data identifies the contract under NAICS code 517110 (Wired Telecommunications Carriers) and the description 'PURCHASE MATERIAL & EQUIPMENT'. However, it does not specify the exact nature of the 'material & equipment'. This could range from fiber optic cables, routers, switches, modems, to other network hardware. Without more granular detail, it's impossible to ascertain the precise technological components procured. Understanding the specific equipment is crucial for assessing its relevance to current technological standards and its long-term utility.

How does the per-unit cost of the equipment compare to market rates at the time of award?

The provided data does not include per-unit cost information, making a direct comparison to market rates impossible. The total award amount is $12,713,262.76. To perform a per-unit cost analysis, we would need to know the quantity of each specific item purchased. Benchmarking would involve researching the average selling prices of similar telecommunications hardware from vendors like Cisco, Juniper, or others during the 2006-2010 contract period. The 'GA' contract type might indicate use of GSA schedules, which often have pre-negotiated pricing, but without the specific items, a definitive comparison cannot be made.

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

Northrop Grumman Information Technology Inc. (now part of Northrop Grumman Corporation) has a long history of providing IT and telecommunications solutions to the Department of Defense and other government agencies. While this specific contract involved 'material & equipment' for wired telecommunications, the company has extensive experience in areas like network engineering, cybersecurity, and system integration. Their track record generally indicates a capacity to handle large, complex procurements. However, a detailed review of past performance specific to the exact type of equipment procured here would require accessing more detailed contract history and performance evaluations.

What was the strategic importance of this $12.7 million investment in telecommunications equipment for the Air Force?

This $12.7 million investment was likely strategic for the Air Force's operational readiness and command and control capabilities. Reliable and robust wired telecommunications are fundamental to military operations, enabling secure voice, data, and video transmission across bases and potentially to deployed units. The purchase of 'material & equipment' suggests an effort to upgrade, expand, or maintain critical network infrastructure. Given the award date (2006), this could have been part of initiatives to modernize networks to support evolving mission requirements or enhance cybersecurity posture in anticipation of future threats.

How has spending on wired telecommunications carriers (NAICS 517110) by the Department of Defense evolved since this contract was awarded?

Since this contract was awarded in 2006, federal spending on wired telecommunications carriers by the Department of Defense has likely seen significant evolution. Factors such as technological advancements (e.g., increased reliance on fiber optics, software-defined networking), cybersecurity imperatives, and shifts in communication strategies (e.g., cloud adoption, mobile integration) have influenced procurement patterns. While specific year-over-year DoD spending figures for NAICS 517110 would require detailed analysis of federal procurement data, it's reasonable to assume a trend towards more sophisticated, higher-bandwidth, and secure solutions, potentially with a greater emphasis on integrated communication systems rather than just raw equipment.

What are the potential risks associated with relying on a single large contractor like Northrop Grumman for this type of equipment?

Relying on a single large contractor like Northrop Grumman for a significant portion of telecommunications equipment can introduce several risks. These include potential vendor lock-in, where switching providers becomes difficult and costly. There's also a risk of supply chain disruptions if the contractor faces production issues or financial instability. Furthermore, a lack of direct competition for follow-on needs could lead to less favorable pricing in the future. While Northrop Grumman is a reputable firm, these general risks associated with single-source reliance are relevant considerations for long-term infrastructure investments.

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: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Titan II Inc. (UEI: 016435559)

Address: 7575 COLSHIRE DRIVE, MCLEAN, VA, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $12,713,263

Exercised Options: $12,713,263

Current Obligation: $12,713,263

Contract Characteristics

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA877104D0004

IDV Type: IDC

Timeline