IBM awarded $12.6M for Millimeter-Wave Autonomic Radios (MARS) R&D by the Air Force

Contract Overview

Contract Amount: $12,646,389 ($12.6M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Defense

Start Date: 2009-03-23

End Date: 2015-12-30

Contract Duration: 2,473 days

Daily Burn Rate: $5.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: COST NO FEE

Sector: R&D

Official Description: MILLIMETER-WAVE AUTONOMIC RADIOS (MARS)

Place of Performance

Location: YORKTOWN HEIGHTS, WESTCHESTER County, NEW YORK, 10598

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $12.6 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: MILLIMETER-WAVE AUTONOMIC RADIOS (MARS) Key points: 1. Contract focused on advanced radio technology research and development. 2. Full and open competition suggests a potentially competitive bidding process. 3. Contract duration of over 2000 days indicates a long-term R&D effort. 4. The R&D nature of the contract implies inherent technical risks. 5. IBM's extensive experience in technology solutions positions them well for this work. 6. Spending is categorized under Research and Development in Physical, Engineering, and Life Sciences. 7. No specific small business set-aside was indicated for this contract.

Value Assessment

Rating: fair

The contract value of $12.6 million for a 2473-day research and development effort appears reasonable given the specialized nature of millimeter-wave technology. Benchmarking R&D contracts is challenging due to unique technical requirements and intellectual property development. However, the cost-plus-no-fee (CPNF) contract type suggests that the government is primarily paying for IBM's direct costs and labor, with profit being a smaller component, which can be advantageous in R&D settings where outcomes are uncertain. Without specific performance metrics or deliverables, a definitive value-for-money assessment is difficult.

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. The presence of 3 bids suggests a moderate level of competition for this specialized R&D requirement. While not a large number of bidders, it implies that the Air Force sought out and received proposals from multiple interested parties, which is a positive sign for price discovery and ensuring a reasonable offer.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to more cost-effective solutions and prevent price gouging.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Air Force, which gains access to advanced radio communication technology. The contract supports the development of Millimeter-Wave Autonomic Radios (MARS), potentially enhancing military communication capabilities. The geographic impact is primarily within New York, where IBM is headquartered, suggesting potential for local economic activity and employment. Workforce implications include specialized R&D roles for engineers and scientists within IBM.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Uncertainty of R&D outcomes can lead to budget overruns if not managed carefully.
The long duration of the contract (2473 days) requires sustained oversight to ensure progress and prevent scope creep.
Reliance on a single large contractor for critical R&D may limit future flexibility or innovation from other sources.

Positive Signals

Awarded through full and open competition, indicating a structured procurement process.
IBM is a well-established technology provider with a strong track record in complex R&D projects.
The contract focuses on a critical area of defense technology (advanced radio communications).

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on advanced physical sciences and engineering related to communication technologies. The market for millimeter-wave technology is a niche but growing area within the broader telecommunications and defense electronics industries. Spending in this area is driven by the need for higher bandwidth, faster speeds, and more secure communication systems, particularly for military applications where spectrum congestion and interference are significant concerns. Comparable spending benchmarks are difficult to establish due to the highly specialized and often classified nature of defense R&D.

Small Business Impact

This contract did not include a small business set-aside, as indicated by the 'sb' field being false. IBM, the awardee, is a large corporation. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, unless IBM voluntarily engages small businesses as subcontractors for specialized components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Department of the Air Force. Accountability measures would be tied to the research milestones and deliverables outlined in the contract. Transparency is generally limited for defense R&D contracts due to their specialized nature and potential security implications. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Advanced Communications Research
Millimeter-Wave Technology Development
Department of Defense Research and Development Programs
Air Force Science and Technology Initiatives

Risk Flags

Long contract duration requires sustained oversight.
R&D projects carry inherent technical and cost uncertainty.
Potential for limited small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $12.6 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. MILLIMETER-WAVE AUTONOMIC RADIOS (MARS)

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

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 $12.6 million.

What is the period of performance?

Start: 2009-03-23. End: 2015-12-30.

What is the specific technical objective of the Millimeter-Wave Autonomic Radios (MARS) program?

The specific technical objective of the Millimeter-Wave Autonomic Radios (MARS) program, as indicated by the contract's focus on R&D in physical sciences and engineering, is likely to develop advanced radio communication systems operating in the millimeter-wave frequency bands. These systems are expected to offer significantly higher data rates and bandwidth compared to traditional radio frequencies. The 'autonomic' aspect suggests a focus on self-configuring, self-healing, and self-optimizing network capabilities, potentially reducing the need for manual intervention and enhancing operational efficiency and resilience in complex electromagnetic environments. This could involve research into novel antenna designs, signal processing algorithms, power management techniques, and secure communication protocols tailored for the unique characteristics of millimeter-wave propagation.

How does the $12.6 million contract value compare to other R&D contracts for similar technologies?

Benchmarking the $12.6 million contract value for Millimeter-Wave Autonomic Radios (MARS) against similar R&D contracts is challenging due to the specialized nature of millimeter-wave technology and the proprietary aspects of defense R&D. However, R&D contracts can vary widely in cost depending on the scope, duration, and technological maturity. Contracts for fundamental research might be smaller, while those involving prototype development and testing of complex systems, like advanced radios, can easily reach multi-million dollar figures. The duration of this contract (2473 days, approximately 6.7 years) suggests a comprehensive research and development effort. Without access to specific details on deliverables, technical milestones, and the competitive landscape for comparable R&D efforts, a precise comparison is difficult. The cost-plus-no-fee (CPNF) structure implies that the government is covering IBM's costs plus a fixed fee, which is common for R&D where the final cost is uncertain.

What are the primary risks associated with this R&D contract for the Department of Defense?

The primary risks associated with this R&D contract for the Department of Defense (DoD) revolve around the inherent uncertainties of technological development. Firstly, there is a significant technical risk: millimeter-wave technology faces challenges with signal propagation (e.g., susceptibility to atmospheric conditions and obstructions) and requires novel solutions for effective deployment. The 'autonomic' aspect adds complexity, requiring sophisticated software and AI integration. Secondly, there is a cost risk; R&D projects can exceed initial budget estimates if unforeseen technical hurdles arise or if the scope needs to be adjusted. The CPNF contract type, while managing profit, still means the government bears the direct costs. Thirdly, there is a schedule risk; achieving breakthrough R&D objectives within the planned timeframe is not guaranteed, potentially delaying the fielding of advanced capabilities. Finally, there's an obsolescence risk; the pace of technological change means that by the time the MARS system is fully developed, newer, more advanced technologies might emerge.

What is IBM's track record in defense R&D and advanced communication systems?

IBM has a long and extensive track record in defense research and development, as well as in pioneering advanced communication systems. The company has historically engaged in numerous contracts with various branches of the U.S. military and intelligence agencies, contributing to areas such as secure communications, advanced computing, artificial intelligence, and sensor technology. IBM's research divisions have been at the forefront of technological innovation for decades, often collaborating with government entities on cutting-edge projects. Their expertise in areas relevant to millimeter-wave technology, such as advanced materials, semiconductor development, signal processing, and network architecture, positions them as a capable contractor for this type of specialized R&D. While specific details of past MARS-related projects may be classified or proprietary, IBM's overall profile suggests a strong capability to undertake complex defense R&D initiatives.

How does the 'full and open competition' aspect influence the potential value for taxpayers?

The 'full and open competition' award strategy for this $12.6 million R&D contract is generally beneficial for taxpayers. It ensures that a wide range of potential offerors, including large corporations like IBM and potentially smaller, specialized firms, have the opportunity to compete. This broad competition typically drives down prices as contractors vie for the award by offering their best technical solutions at competitive rates. It also encourages innovation, as companies strive to differentiate their proposals based on technical merit and cost-effectiveness. Furthermore, it provides assurance that the selected contractor, IBM in this case, was chosen through a rigorous evaluation process, suggesting that the proposed solution and cost are deemed reasonable relative to the requirements and the market. This process helps prevent sole-source awards, which can sometimes lead to higher costs due to a lack of competitive pressure.

What are the implications of the 'Cost No Fee' (CPNF) contract type for this R&D effort?

The 'Cost No Fee' (CPNF) contract type for this R&D effort has significant implications for both the contractor (IBM) and the government (Department of the Air Force). In a CPNF contract, the government agrees to pay the contractor its actual allowable costs incurred in performing the work, but the contractor does not receive any additional profit or fee beyond the reimbursement of costs. This structure is often used for R&D contracts where the final outcome is highly uncertain, and the primary goal is to fund the research itself rather than a specific, guaranteed deliverable. For the government, it means the cost is primarily driven by the resources expended (labor, materials, overhead) rather than a negotiated profit margin, which can be advantageous when the scope is exploratory. For IBM, it means the incentive is focused on executing the research effectively and managing costs efficiently to ensure the project's completion within the allocated budget, rather than maximizing profit. This can foster a more collaborative approach between the contractor and the government in navigating research challenges.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: BASIC RESEARCH

Offers Received: 3

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

Address: 1101 KITCHAWAN RD, YORKTOWN HEIGHTS, NY, 17

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

Financial Breakdown

Contract Ceiling: $28,893,370

Exercised Options: $12,646,389

Current Obligation: $12,646,389

Contract Characteristics

Cost or Pricing Data: NO

Timeline