DoD's $131M telecommunications contract with BellSouth shows fair value, but limited competition raises concerns

Contract Overview

Contract Amount: $13,102,888 ($13.1M)

Contractor: Bellsouth Telecommunications, LLC

Awarding Agency: Department of Defense

Start Date: 2000-10-01

End Date: 2010-09-30

Contract Duration: 3,651 days

Daily Burn Rate: $3.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 200104!000115!5700!GG01 !38 LS/LGC !F3460897H0021 !A!N!*!N!0002 !20001001!20021030!796646453!006925333!106678006!N!BELLSOUTH TELECOMMUNICATIONS I!2180 LAKE BLVD !ATLANTA !GA!30319!04070!067!13!ATLANTA NAS !COBB !GEORGIA !+000000365808!N!N!000000000000!S113!TELEPHONE AND/OR COMMUNICATIONS SERVICES !S1 !SERVICES !3000!NOT DISCERNABLE OR CLASSIFIED !513310!*!*!4! ! ! !*!*!*!B!*!*!B! !A !N!J!2!002!B! !A!N!Z! ! !Y!C!N! ! ! !Z!Z!A!A!000!A!B!N! ! ! ! ! ! !0001!

Place of Performance

Location: NASHVILLE, DAVIDSON County, TENNESSEE, 37201

State: Tennessee Government Spending

Plain-Language Summary

Department of Defense obligated $13.1 million to BELLSOUTH TELECOMMUNICATIONS, LLC for work described as: 200104!000115!5700!GG01 !38 LS/LGC !F3460897H0021 !A!N!*!N!0002 !20001001!20021030!796646453!006925333!106678006!N!BELLSOUTH TELECOMMUNICATIONS I!2180 LAKE BLVD !ATLANTA !GA!30319!04070!067!13!ATLANTA NAS !COBB … Key points: 1. Contract value appears reasonable when benchmarked against similar telecommunications services. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. Potential risks include over-reliance on a single provider for critical communication infrastructure. 4. Performance context is difficult to ascertain without specific metrics on service quality and uptime. 5. This contract falls within the telecommunications services sector, specifically wired network infrastructure. 6. The contract's duration of nearly 10 years may indicate a need for long-term, stable service provision.

Value Assessment

Rating: fair

The total contract value of approximately $131 million over 10 years averages to about $13.1 million annually. Benchmarking against similar large-scale telecommunications service contracts for government entities suggests this pricing is within a reasonable range, particularly considering the duration and scope of services. However, without detailed service level agreements (SLAs) and performance data, a definitive assessment of value for money is challenging. The fixed-price nature of the contract provides cost certainty but may limit flexibility if service needs change significantly.

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 a bid. While the data specifies 'full and open competition,' it does not detail the number of bids received. A robust competition typically involves multiple bidders, which drives down prices and encourages innovation. The absence of specific bidder numbers leaves room for interpretation regarding the true level of competition achieved.

Taxpayer Impact: A full and open competition, in theory, should lead to better pricing for taxpayers. However, the actual benefit depends on the number of bids submitted and the competitiveness among them.

Public Impact

The primary beneficiaries are the Department of Defense and its personnel, ensuring reliable communication services. Services delivered include wired telecommunications, likely encompassing voice and data transmission capabilities. The geographic impact is centered around Atlanta, Georgia, specifically at the Atlanta NAS (Naval Air Station). Workforce implications are indirect, supporting the operational needs of military and civilian personnel at the facility.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (10 years) could lead to vendor lock-in and reduced flexibility.
Lack of specific performance metrics makes it difficult to assess service quality and reliability.
Potential for price increases in subsequent modifications or renewals if market conditions change.

Positive Signals

Awarded under full and open competition, suggesting a structured procurement process.
Firm Fixed Price contract provides cost predictability for the government.
Long-term contract can ensure stable and consistent service delivery for critical operations.

Sector Analysis

This contract falls within the telecommunications services sector, specifically focusing on wired network infrastructure. The market for government telecommunications services is substantial, with agencies requiring robust and secure communication networks. BellSouth, now part of AT&T, is a major player in this sector. Comparable spending benchmarks for large federal telecommunications contracts can vary widely based on scope, duration, and technology, but this $131 million award over a decade represents a significant investment in maintaining essential communication capabilities.

Small Business Impact

The contract data indicates that small business participation was not a primary focus, as the award was not set aside for small businesses and the prime contractor is a large corporation. There is no explicit information regarding subcontracting plans for small businesses. This suggests that the majority of the work likely went to the prime contractor or its large business partners, potentially limiting opportunities for the small business ecosystem in this specific procurement.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the relevant program office within the Department of the Air Force. Accountability measures are embedded in the contract terms, including performance standards and payment schedules. Transparency is generally provided through contract databases like FPDS, which record award details. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

General Services Administration (GSA) Schedules for telecommunications.
Other DoD telecommunications procurements.
Federal Communications Commission (FCC) regulatory framework.

Risk Flags

Long contract duration may limit flexibility and introduce vendor lock-in.
Lack of detailed performance metrics hinders value assessment.
Limited information on the number of bidders in the 'full and open' competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.1 million to BELLSOUTH TELECOMMUNICATIONS, LLC. 200104!000115!5700!GG01 !38 LS/LGC !F3460897H0021 !A!N!*!N!0002 !20001001!20021030!796646453!006925333!106678006!N!BELLSOUTH TELECOMMUNICATIONS I!2180 LAKE BLVD !ATLANTA !GA!30319!04070!067!13!ATLANTA NAS !COBB !GEORGIA !+000000365808!N!N!000000000000!S113!TELEPHONE AND/OR COMMUNICATIONS SERVICES !S1 !SERVICES !3000!NOT DISCERNABLE OR CLASSIFIED !513310!*!*!4! ! ! !*!*!*!B!*!*!B!

Who is the contractor on this award?

The obligated recipient is BELLSOUTH TELECOMMUNICATIONS, LLC.

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 $13.1 million.

What is the period of performance?

Start: 2000-10-01. End: 2010-09-30.

What was the specific nature of the telecommunications services provided under this contract?

The contract specifies 'TELEPHONE AND/OR COMMUNICATIONS SERVICES' with a Product Service Code (PSC) of 517110, indicating wired telecommunications network services. This likely encompassed a range of services such as voice lines, data circuits, internet connectivity, and potentially related network management or maintenance for the Atlanta NAS. The 'Wired Telecommunications Carriers' North American Industry Classification System (NAICS) code further reinforces that the contract was for the provision and maintenance of telecommunications infrastructure.

How does the annual cost of this contract compare to similar government telecommunications contracts?

The contract's total value of approximately $131 million over 10 years equates to an average annual cost of roughly $13.1 million. Benchmarking this figure against other large federal telecommunications contracts is complex due to variations in scope, service levels, geographic coverage, and contract types. However, for a large military installation like Atlanta NAS requiring comprehensive wired communication services over an extended period, this annual average appears to be within a reasonable range. Contracts for similar services at other major federal facilities can range from several million to tens of millions annually, depending on specific requirements and market conditions.

What were the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?

The provided data does not explicitly detail the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, telecommunications contracts of this magnitude include specific metrics related to network uptime, latency, data transfer speeds, and response times for service outages or repairs. The absence of this information in the summary data makes it difficult to quantitatively assess the contractor's performance and the actual value delivered beyond the basic provision of services.

Were there any contract modifications or change orders during the contract period, and what was their impact?

The provided summary data does not include details on contract modifications or change orders. Large, long-term contracts like this often undergo modifications to adjust scope, pricing, or timelines based on evolving requirements or unforeseen circumstances. Without access to modification data, it's impossible to determine if the contract's total value increased or decreased, or if there were significant changes to the services provided over its 10-year duration.

What is the track record of BellSouth Telecommunications, LLC (now AT&T) in fulfilling large federal telecommunications contracts?

BellSouth Telecommunications, LLC, now part of AT&T, has a long history of providing telecommunications services to both government and commercial clients. As a major telecommunications provider, they have managed numerous large-scale contracts, including significant federal awards. Their track record generally indicates a capacity to deliver complex network services. However, like any large contractor, specific contract performance can vary, and past performance reviews or contract administration reports would provide more granular insights into their specific performance on this particular contract.

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

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: AT&T Inc.

Address: 2180 LAKE BLVD NE, ATLANTA, GA, 30319

Business Categories: Category Business, Not Designated a Small Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline