State Department awards AT&T $172M for domestic telecom services, highlighting wired carrier market

Contract Overview

Contract Amount: $172,070,001 ($172.1M)

Contractor: AT&T Enterprises, LLC

Awarding Agency: Department of State

Start Date: 2020-08-12

End Date: 2026-08-11

Contract Duration: 2,190 days

Daily Burn Rate: $78.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: AWARD OF TASK ORDER ONE FOR DOMESTIC TELECOMMUNICATIONS FOR THE DOS.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20006

State: District of Columbia Government Spending

Plain-Language Summary

Department of State obligated $172.1 million to AT&T ENTERPRISES, LLC for work described as: AWARD OF TASK ORDER ONE FOR DOMESTIC TELECOMMUNICATIONS FOR THE DOS. Key points: 1. Contract value of $172 million over six years suggests significant investment in core telecommunications infrastructure. 2. Award to AT&T, a major player, indicates reliance on established providers for critical services. 3. The 'Delivery Order' type suggests this is part of a larger, pre-existing framework agreement. 4. A 6-year duration points to long-term strategic planning for the department's communication needs. 5. The contract's focus on wired telecommunications carriers positions it within a mature but essential technology sector.

Value Assessment

Rating: good

The award of $172 million for domestic telecommunications services over six years appears to be within a reasonable range for large-scale government contracts of this nature. Benchmarking against similar contracts for telecommunications infrastructure and services for federal agencies would provide a more precise value-for-money assessment. However, given the duration and scope, the per-year cost is substantial, necessitating careful review of service levels and performance metrics to ensure optimal resource utilization.

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 had the opportunity to bid. The presence of three bidders (implied by 'no': 3) suggests a competitive environment, which typically leads to better pricing and service offerings for the government. The specific details of the bidding process and the evaluation criteria would further illuminate the effectiveness of this competition in securing the best value.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a market where providers strive to offer the most competitive prices and innovative solutions to win government contracts.

Public Impact

The Department of State benefits from enhanced and reliable domestic telecommunications services. Federal employees and operations within the U.S. will utilize the wired telecommunications infrastructure. The primary geographic impact is within the District of Columbia, where the contract is registered. The contract supports jobs within the telecommunications sector, particularly for AT&T and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if service evolution is not actively managed.
Reliance on a single provider for critical infrastructure could pose risks during outages or security incidents.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Long-term contract provides stability for essential communication services.
AT&T's established infrastructure and experience likely ensure reliable service delivery.

Sector Analysis

The contract falls within the Wired Telecommunications Carriers industry, a sector characterized by established infrastructure and ongoing technological evolution. This sector is crucial for government operations, providing the backbone for communication networks. Spending in this area is typically substantial due to the critical nature of telecommunications. Comparable spending benchmarks would involve analyzing other large federal contracts for telecommunications services, which often run into hundreds of millions of dollars over several years.

Small Business Impact

The data indicates this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary award went to a large corporation, AT&T. Further analysis would be needed to determine if AT&T has a robust small business subcontracting plan in place to ensure opportunities for smaller enterprises within its supply chain.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officers and program managers within the Department of State. Accountability measures would be embedded in the contract's performance standards and service level agreements. Transparency is facilitated through contract databases like FPDS, which record award details. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

General Services Administration (GSA) Federal Supply Schedule Contracts
Department of Defense Telecommunications Services
Other Agency Specific Telecommunications Contracts

Risk Flags

Potential for service disruption impacting critical government functions.
Cybersecurity vulnerabilities inherent in large-scale telecommunications networks.
Long-term reliance on a single vendor may limit future flexibility and cost savings.

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $172.1 million to AT&T ENTERPRISES, LLC. AWARD OF TASK ORDER ONE FOR DOMESTIC TELECOMMUNICATIONS FOR THE DOS.

Who is the contractor on this award?

The obligated recipient is AT&T ENTERPRISES, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $172.1 million.

What is the period of performance?

Start: 2020-08-12. End: 2026-08-11.

What is the historical spending pattern for domestic telecommunications services by the Department of State?

Analyzing historical spending for domestic telecommunications by the Department of State is crucial for understanding trends and justifying current investment levels. While specific historical data for this exact contract type is not provided, federal agencies typically spend significant amounts on telecommunications infrastructure and services. This spending often fluctuates based on technological upgrades, security requirements, and the overall size and operational needs of the agency. For instance, agencies might increase spending during periods of network modernization or when expanding their reach. Comparing the $172 million award over six years ($28.67 million annually) to previous expenditures would reveal whether this represents an increase, decrease, or stable investment in their domestic telecom capabilities. A detailed review of past contracts, including their scope, duration, and value, would provide essential context for assessing the current award's financial prudence and strategic alignment.

How does the pricing structure of this AT&T contract compare to market rates for similar services?

Assessing the pricing structure against market rates is key to determining value for money. This contract, awarded under full and open competition, suggests that AT&T's proposed pricing was deemed competitive among the bidders. However, 'market rates' for large-scale federal telecommunications can be complex due to negotiated discounts, specific service level agreements (SLAs), and the sheer volume of services procured. To benchmark effectively, one would compare the per-unit costs for specific services (e.g., bandwidth, voice lines, data circuits) against rates offered by other major telecommunications providers to government agencies or large commercial enterprises. Factors like contract duration, included support, and geographic coverage also influence pricing. Without detailed service breakdowns and specific market data, a definitive comparison is challenging, but the competitive award process provides a baseline indication of reasonableness.

What are the primary risks associated with relying on AT&T for critical domestic telecommunications?

The primary risks associated with relying on AT&T for critical domestic telecommunications include potential service disruptions, cybersecurity vulnerabilities, and vendor lock-in. Service disruptions could arise from network outages, natural disasters, or infrastructure failures, impacting the Department of State's ability to operate. Cybersecurity risks are inherent in any telecommunications network, and a single point of failure could be a target for malicious actors. Vendor lock-in is another concern; as the contract progresses, transitioning to a different provider might become technically complex and costly, potentially reducing future negotiating leverage. Mitigating these risks involves robust service level agreements with penalties, stringent security protocols, regular performance audits, and contingency planning for service continuity.

What performance metrics are likely being used to evaluate AT&T's service delivery under this contract?

Performance metrics for a contract of this nature typically focus on reliability, availability, speed, and customer support. Key metrics likely include network uptime percentages (e.g., 99.99% availability), latency and jitter for data transmission, bandwidth provisioning times, and response times for technical support and issue resolution. The Department of State would have established specific Service Level Agreements (SLAs) within the contract that define these metrics and outline penalties for non-compliance. Regular performance reviews, potentially including monthly or quarterly reports from AT&T and independent testing, would be conducted to ensure adherence to these standards. The success of the contract hinges on meeting or exceeding these defined performance benchmarks.

How does this contract align with the Department of State's broader IT modernization and security goals?

This contract for domestic telecommunications services is fundamental to the Department of State's IT modernization and security goals. Reliable and high-speed wired telecommunications form the backbone of modern digital infrastructure, enabling secure communication, data transfer, and access to cloud-based services. By investing in AT&T's services, the Department is likely ensuring that its internal networks are robust enough to support advanced applications, video conferencing, and secure data exchange necessary for diplomatic operations. Furthermore, modern telecommunications infrastructure often incorporates enhanced security features, which are critical for protecting sensitive government information. The six-year duration suggests a commitment to maintaining a current and secure communication platform, aligning with long-term strategic objectives for digital transformation and enhanced cybersecurity posture.

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: 3

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tyto Athene, LLC

Address: 3033 CHAIN BRIDGE RD, OAKTON, VA, 22124

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

Financial Breakdown

Contract Ceiling: $1,165,866,333

Exercised Options: $451,115,442

Current Obligation: $172,070,001

Actual Outlays: $40,209,802

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q17NSD3000

IDV Type: IDC

Timeline