State Department awards $108.6M for internet services, with 1 awardee and a 14-day duration

Contract Overview

Contract Amount: $108,583 ($108.6K)

Contractor: Miscellaneous Foreign Awardees

Awarding Agency: Department of State

Start Date: 2024-01-17

End Date: 2024-01-31

Contract Duration: 14 days

Daily Burn Rate: $7.8K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: INTERNET SERVICES

Plain-Language Summary

Department of State obligated $108,582.7 to MISCELLANEOUS FOREIGN AWARDEES for work described as: INTERNET SERVICES Key points: 1. The contract's short duration suggests a tactical or immediate need for services. 2. Limited competition is indicated by the single awardee, potentially impacting price. 3. The service category 'Wired Telecommunications Carriers' points to essential network infrastructure. 4. Fixed-price contract type aims to control costs for the government. 5. The awardee's foreign status may influence operational considerations and oversight.

Value Assessment

Rating: fair

The contract value of $108.6 million for a 14-day period is exceptionally high on a per-day basis. While the specific services are not detailed, this suggests either extremely high-demand, critical infrastructure, or potentially a placeholder for a larger, longer-term arrangement. Benchmarking is difficult without more context on the nature of the 'internet services' and the specific geographic or technical requirements. The fixed-price nature is positive for cost control, but the overall value proposition is unclear due to the short term and high aggregate cost.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under 'SAP' (Simplified Acquisition Procedures), which typically implies smaller dollar values or specific circumstances allowing for less formal competition. With only one awardee, the level of competition is very low. This raises questions about whether a broader solicitation could have yielded better pricing or more options for the Department of State. The limited competition may have resulted in a higher price than if multiple vendors had vied for the contract.

Taxpayer Impact: Taxpayers may not have received the best possible price due to the limited competitive environment. The lack of robust competition could mean that the government paid a premium for these essential internet services.

Public Impact

The Department of State benefits directly through the provision of critical internet services. These services are essential for diplomatic communications, operations, and data transfer. The geographic impact is likely global, supporting U.S. embassies and personnel worldwide. Workforce implications are minimal for this specific contract, focusing on service delivery rather than direct employment generation.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High cost per day raises concerns about efficiency and potential overpayment.
Limited competition suggests potential for inflated pricing and reduced value for taxpayer funds.
The 'MISCELLANEOUS FOREIGN AWARDEES' designation requires careful vetting and oversight due to potential geopolitical or security risks.

Positive Signals

Firm Fixed Price contract type provides cost certainty.
The award addresses a clear need for internet services, crucial for government operations.
Simplified Acquisition Procedures may indicate an urgent or specialized requirement.

Sector Analysis

This contract falls within the Telecommunications sector, specifically wired telecommunications carriers. This sector is vital for modern infrastructure, providing the backbone for data transmission and communication. The market is characterized by significant capital investment and regulatory oversight. Comparable spending benchmarks for internet services can vary widely based on bandwidth, reliability, and geographic scope. Given the high value for a short period, this contract may represent a specialized, high-capacity, or geographically unique service offering.

Small Business Impact

The data indicates this contract was not set aside for small businesses (sb: false). There is no information provided regarding subcontracting plans. Given the nature of the awardee ('MISCELLANEOUS FOREIGN AWARDEES') and the potential scale of the services, it is unlikely that small businesses would be significantly involved as prime contractors or major subcontractors unless specifically included in a subcontracting plan.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of State's contracting and financial management offices. Given the foreign awardee, additional scrutiny from the Bureau of Diplomatic Security and potentially the Office of the Inspector General may be warranted to ensure compliance, security, and proper service delivery. Transparency is limited by the nature of the simplified acquisition and foreign awardee designation.

Related Government Programs

General Services Administration (GSA) Schedules for telecommunications
Department of Defense (DoD) telecommunications contracts
Federal Communications Commission (FCC) regulatory oversight

Risk Flags

High cost per day
Limited competition
Foreign awardee
Unclear service specifics

Frequently Asked Questions

What is this federal contract paying for?

Department of State awarded $108,582.7 to MISCELLANEOUS FOREIGN AWARDEES. INTERNET SERVICES

Who is the contractor on this award?

The obligated recipient is MISCELLANEOUS FOREIGN AWARDEES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $108,582.7.

What is the period of performance?

Start: 2024-01-17. End: 2024-01-31.

What specific type of 'internet services' are being procured, and what is the expected bandwidth and reliability?

The provided data classifies the service under NAICS code 517111 (Wired Telecommunications Carriers) and describes the contract type as 'INTERNET SERVICES'. However, specific details regarding bandwidth, latency, reliability Service Level Agreements (SLAs), and the exact nature of the service (e.g., dedicated fiber, broadband access, network backbone) are not available in the summary data. This information is crucial for understanding the necessity of the high cost and the operational criticality of the service. Without these specifics, it's difficult to benchmark the value effectively or assess performance risks beyond the general category.

What is the justification for awarding this contract to a 'MISCELLANEOUS FOREIGN AWARDEES' under Simplified Acquisition Procedures?

Simplified Acquisition Procedures (SAP) are typically used for purchases below the simplified acquisition threshold (currently $250,000), or for specific circumstances like commercial items or urgent needs. Awarding $108.6 million under SAP, especially to a foreign entity, is highly unusual and suggests either a significant error in the data provided or a very specific, possibly urgent, requirement that bypassed standard competitive bidding processes. Foreign awardees often require additional vetting for security and compliance. The justification would likely stem from unique capabilities, geographic necessity, or potentially a national security imperative that necessitated rapid procurement from a specific foreign source.

How does the $108.6 million cost for a 14-day contract compare to typical spending for similar internet services?

The cost of $108.6 million for just 14 days equates to approximately $7.76 million per day. This is an extraordinarily high daily rate for internet services. Typical government contracts for robust internet connectivity, even for large organizations or critical infrastructure, are usually priced on a monthly or annual basis and do not reach such daily figures unless they involve highly specialized, temporary, or emergency deployment scenarios (e.g., satellite bandwidth for disaster relief in remote areas, or temporary high-capacity links for major international events). This rate suggests the service is either exceptionally high-bandwidth, mission-critical, or involves significant logistical/deployment costs not immediately apparent.

What are the potential risks associated with contracting with 'MISCELLANEOUS FOREIGN AWARDEES' for critical internet services?

Contracting with foreign entities for critical infrastructure like internet services introduces several potential risks. These include cybersecurity vulnerabilities, as the network infrastructure could be subject to foreign government surveillance or interference. Geopolitical risks are also a concern, as the relationship between the U.S. and the awardee's home country could impact service continuity or data access. Legal and regulatory compliance can be more complex, involving differing laws and jurisdictions. Furthermore, ensuring accountability and recourse in case of performance issues or breaches can be more challenging with foreign entities compared to domestic ones. The 'MISCELLANEOUS' designation adds a layer of ambiguity, potentially obscuring the specific entity and its background.

What oversight mechanisms are in place to ensure the performance and security of these internet services provided by a foreign entity?

Oversight would typically involve the contracting officer's representative (COR) at the Department of State, responsible for monitoring performance and ensuring adherence to contract terms. Given the foreign awardee and critical nature of internet services, enhanced security oversight from the Bureau of Diplomatic Security is probable. This might include technical assessments, security audits, and potentially on-site inspections if feasible. The Office of the Inspector General (OIG) for the Department of State may also conduct audits or investigations into the contract's execution, particularly concerning value and security compliance. However, the effectiveness of oversight can be constrained by the foreign jurisdiction and the limited competition.

Industry Classification

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

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 F ST NW, WASHINGTON, DC, 20405

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $108,583

Exercised Options: $108,583

Current Obligation: $108,583

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline