State Dept. Spends $263M on Foreign Telephone Systems via Full and Open Competition

Contract Overview

Contract Amount: $263,101,937 ($263.1M)

Contractor: AT&T Technical Services Company, Inc

Awarding Agency: Department of State

Start Date: 2014-06-16

End Date: 2021-03-31

Contract Duration: 2,480 days

Daily Burn Rate: $106.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: VANGUARD 2.2.5 - JANUS III - PROCUREMENT AND INSTALLATION OF NEW TELEPHONE SYSTEMS IN FOREIGN POSTS INCLUDING ALL EQUIPMENT,SUPPORTING SERVICES (SITE SURVEYS, TRAINING, INSTALLATION, CONFIGUATION, REQUIRED REPORTS, WARRANTY AND NON-WARRANTY, PARTS REPLACEMENT AND REPAIR, SOFTWARE LICENSES AND MAINTENANCE, AND SYSTEM SUPPORT) AND KEY PERSONNEL.

Place of Performance

Location: SPRINGFIELD, FAIRFAX County, VIRGINIA, 22153

State: Virginia Government Spending

Plain-Language Summary

Department of State obligated $263.1 million to AT&T TECHNICAL SERVICES COMPANY, INC for work described as: VANGUARD 2.2.5 - JANUS III - PROCUREMENT AND INSTALLATION OF NEW TELEPHONE SYSTEMS IN FOREIGN POSTS INCLUDING ALL EQUIPMENT,SUPPORTING SERVICES (SITE SURVEYS, TRAINING, INSTALLATION, CONFIGUATION, REQUIRED REPORTS, WARRANTY AND NON-WARRANTY, PARTS REPLACEMENT AND REPAIR, SOFTWARE… Key points: 1. Significant investment in global telecommunications infrastructure for diplomatic missions. 2. AT&T secured the contract, indicating strong incumbent capabilities or competitive bidding. 3. Long contract duration (2480 days) suggests a complex, multi-year deployment and support. 4. The $263M expenditure represents a substantial portion of the Wired Telecommunications Carriers sector spending for the period.

Value Assessment

Rating: good

The total contract value of $263M for a comprehensive telephone system procurement and installation appears reasonable given the scope, duration, and inclusion of extensive support services. Benchmarking against similar large-scale government telecommunications projects would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a robust price discovery process. This method typically leads to more competitive pricing as multiple vendors are encouraged to bid.

Taxpayer Impact: Taxpayer funds were utilized through a competitive process, aiming for value for money in essential government communication infrastructure.

Public Impact

Ensures reliable and secure communication for U.S. diplomats and personnel stationed abroad. Supports critical foreign policy operations and information exchange. Modernization of communication systems can enhance efficiency and operational capabilities. Potential for job creation within the telecommunications sector and supporting industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration may lead to technology obsolescence if not managed proactively.
Reliance on a single vendor for extensive support could pose risks if performance falters.

Positive Signals

Full and open competition likely secured competitive pricing.
Comprehensive scope covers all aspects of system lifecycle, reducing vendor management complexity.
Award to a major telecommunications provider suggests a high likelihood of successful deployment.

Sector Analysis

This contract falls within the Wired Telecommunications Carriers sector, specifically supporting government agencies' need for robust global communication networks. Spending benchmarks for similar large-scale government IT and telecommunications procurements would be relevant for comparison.

Small Business Impact

While the prime contractor is AT&T, the contract details do not specify the extent of small business participation. Further analysis would be needed to determine if small businesses were leveraged for subcontracting opportunities.

Oversight & Accountability

The Department of State managed this procurement, likely involving program managers and contracting officers to ensure adherence to terms and conditions. Oversight would focus on delivery schedules, performance, and financial accountability throughout the contract's lifecycle.

Related Government Programs

Wired Telecommunications Carriers
Department of State Contracting
Department of State Programs

Risk Flags

Long contract duration increases risk of technology obsolescence.
Potential for vendor lock-in due to comprehensive support requirements.
Lack of detailed cost breakdown makes granular price assessment difficult.
Need for ongoing monitoring of vendor performance and service quality.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $263.1 million to AT&T TECHNICAL SERVICES COMPANY, INC. VANGUARD 2.2.5 - JANUS III - PROCUREMENT AND INSTALLATION OF NEW TELEPHONE SYSTEMS IN FOREIGN POSTS INCLUDING ALL EQUIPMENT,SUPPORTING SERVICES (SITE SURVEYS, TRAINING, INSTALLATION, CONFIGUATION, REQUIRED REPORTS, WARRANTY AND NON-WARRANTY, PARTS REPLACEMENT AND REPAIR, SOFTWARE LICENSES AND MAINTENANCE, AND SYSTEM SUPPORT) AND KEY PERSONNEL.

Who is the contractor on this award?

The obligated recipient is AT&T TECHNICAL SERVICES COMPANY, INC.

Which agency awarded this contract?

Awarding agency: Department of State (Department of State).

What is the total obligated amount?

The obligated amount is $263.1 million.

What is the period of performance?

Start: 2014-06-16. End: 2021-03-31.

What was the specific pricing structure for the telephone systems and installation services, and how did it compare to market rates at the time of award?

The contract utilized a Firm Fixed Price (FFP) structure, which shifts cost risk to the contractor. While the total award was $263M, specific unit pricing for individual components like phones, installation labor, and maintenance is not detailed in the provided data. A thorough market analysis would be required to compare these FFP elements against prevailing industry rates to assess cost-effectiveness.

What are the primary risks associated with a long-term (2480-day) contract for telecommunications systems, particularly concerning technological advancements and vendor performance?

The primary risks include technological obsolescence, as communication technology evolves rapidly. If the system is not designed for easy upgrades, it could become outdated before the contract ends. Vendor performance risk is also significant; a long-term reliance on AT&T for support means any degradation in service quality or responsiveness could severely impact diplomatic communications. Proactive contract management and clear performance metrics are crucial to mitigate these risks.

How effectively does this procurement support the Department of State's mission-critical communication needs in diverse and potentially challenging foreign environments?

This procurement is designed to directly address mission-critical needs by providing a comprehensive, modern telephone system with end-to-end support. The inclusion of site surveys, installation, configuration, and ongoing maintenance aims to ensure reliability in various foreign posts. The long duration suggests a commitment to sustained operational capability, which is vital for diplomatic functions. Success hinges on the system's robustness, security features, and the vendor's ability to provide timely support globally.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: SAQMMA14R0046

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2355 DULLES CORNER BLVD # 100, HERNDON, VA, 20171

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $271,260,492

Exercised Options: $263,231,245

Current Obligation: $263,101,937

Actual Outlays: $27,253,584

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q12NSD0004

IDV Type: IDC

Timeline