DoD's $58.7M contract for 144 MHz KU Bandwidth awarded to ARTEL LLC shows strong competition and value

Contract Overview

Contract Amount: $58,753,055 ($58.8M)

Contractor: Artel LLC

Awarding Agency: Department of Defense

Start Date: 2011-09-25

End Date: 2016-09-24

Contract Duration: 1,826 days

Daily Burn Rate: $32.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: 144 MHZ KU BANDWIDTH

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20171

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $58.8 million to ARTEL LLC for work described as: 144 MHZ KU BANDWIDTH Key points: 1. Contract awarded via full and open competition, suggesting a competitive pricing environment. 2. Firm Fixed Price contract type provides cost certainty for the government. 3. Long duration of 1826 days indicates a sustained need for the service. 4. The contract was awarded as a Delivery Order, suggesting it's part of a larger IDIQ. 5. The contractor, ARTEL LLC, has a track record with the Department of Defense. 6. Virginia is the primary state for contract performance, indicating a geographic concentration.

Value Assessment

Rating: good

The contract's value of $58.7 million over approximately five years for 144 MHz KU Bandwidth appears reasonable given the nature of telecommunications services. Benchmarking against similar large-scale bandwidth procurements would provide a more precise value assessment. The firm fixed-price structure helps mitigate cost overruns, contributing to good value.

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. This typically leads to a more robust price discovery process and potentially lower prices due to multiple bidders vying for the contract. The specific number of bidders is not provided, but the competition type suggests a healthy market.

Taxpayer Impact: A full and open competition generally benefits taxpayers by fostering a competitive environment that drives down costs and encourages innovation from multiple vendors.

Public Impact

The Department of Defense is the primary beneficiary, receiving critical bandwidth services. This contract supports essential communication and data transfer capabilities for military operations. Performance is concentrated in Virginia, potentially impacting the local economy through ARTEL LLC's operations. The services delivered are vital for maintaining secure and reliable command and control systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific bidder count limits full assessment of competitive intensity.
Potential for vendor lock-in if this is a sole-source follow-on without re-competition.
Long contract duration could lead to price inflexibility if market rates change significantly.

Positive Signals

Awarded under full and open competition, indicating a competitive process.
Firm Fixed Price contract type offers cost predictability.
The contractor has existing experience with the Department of Defense.
The sustained need suggests the service is critical and well-utilized.

Sector Analysis

This contract falls within the telecommunications and IT services sector, specifically focusing on bandwidth provision. The market for satellite and terrestrial bandwidth is substantial, driven by government and commercial demand for high-capacity data transmission. This contract represents a significant, long-term commitment to securing essential communication infrastructure for defense purposes.

Small Business Impact

The provided data does not indicate any specific small business set-aside or subcontracting requirements for this contract. As a large-value contract awarded under full and open competition, it's possible that larger prime contractors were the primary bidders. Further analysis would be needed to determine if small businesses are involved in the supply chain or as subcontractors.

Oversight & Accountability

As a Delivery Order under a larger contract vehicle, oversight would likely be managed by the Defense Information Systems Agency (DISA) and the Department of Defense. The firm fixed-price nature provides a degree of financial oversight. Transparency is generally good for publicly awarded contracts, but specific performance metrics and oversight reports would require deeper investigation.

Related Government Programs

Defense Information Systems Agency (DISA) Contracts
Department of Defense Telecommunications Services
KU Bandwidth Procurement
Information Technology Services Contracts

Risk Flags

Potential for vendor performance issues
Risk of technological obsolescence
Dependence on satellite infrastructure availability
Contract duration may exceed optimal technology lifecycle

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $58.8 million to ARTEL LLC. 144 MHZ KU BANDWIDTH

Who is the contractor on this award?

The obligated recipient is ARTEL LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Information Systems Agency).

What is the total obligated amount?

The obligated amount is $58.8 million.

What is the period of performance?

Start: 2011-09-25. End: 2016-09-24.

What is ARTEL LLC's track record with the Department of Defense, particularly regarding similar bandwidth or telecommunications contracts?

ARTEL LLC has a history of contracting with the Department of Defense, including previous awards for telecommunications and bandwidth services. Analyzing their past performance on similar contracts would reveal their reliability, technical capability, and adherence to delivery schedules and quality standards. Specific details on past contract values, durations, and performance reviews would offer a clearer picture of their suitability for this $58.7 million award. A review of contract databases and performance assessment reporting systems (like CPARS) would be necessary for a comprehensive understanding of their DoD track record.

How does the awarded price of $58.7 million for 144 MHz KU Bandwidth compare to market rates or similar government procurements?

A precise comparison of the $58.7 million award for 144 MHz KU Bandwidth requires detailed market research and benchmarking against contemporary contracts for similar services. Factors such as contract duration (1826 days), service level agreements, geographic coverage, and specific technical requirements significantly influence pricing. If this contract was awarded through full and open competition, it suggests the price was deemed competitive at the time of award. However, without access to detailed pricing structures and comparable contract data, it's challenging to definitively state if it represents excellent or fair value. Industry reports on bandwidth costs and analysis of other DoD telecommunications procurements would be essential for a robust benchmark.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract, and how is performance monitored?

The provided data does not specify the Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. Typically, for bandwidth services, KPIs would include metrics such as uptime, latency, throughput, and jitter. SLAs define the guaranteed performance levels and remedies for non-compliance. Monitoring would likely involve regular reporting from ARTEL LLC, potentially supplemented by government-side network monitoring tools. The Defense Information Systems Agency (DISA) would be responsible for overseeing adherence to these terms, ensuring the critical communication needs of the DoD are met reliably and effectively.

What is the strategic importance of this 144 MHz KU Bandwidth procurement for the Department of Defense's operational capabilities?

This procurement of 144 MHz KU Bandwidth is strategically vital for the Department of Defense, likely supporting secure and reliable command, control, communications, computers, and intelligence (C4I) functions. KU Band satellite communications are often used for global reach, providing connectivity in areas where terrestrial infrastructure may be unavailable or compromised. This bandwidth ensures the transmission of critical data, voice, and video, enabling real-time situational awareness, operational coordination, and mission execution across various theaters of operation. Its sustained provision over nearly five years underscores its role in maintaining persistent communication capabilities essential for national security.

Are there any potential risks associated with relying on ARTEL LLC for this critical bandwidth service over an 1826-day period?

Potential risks associated with relying on ARTEL LLC for this critical bandwidth service include vendor performance issues, such as service disruptions or failure to meet SLAs, which could impact DoD operations. Technological obsolescence is another risk; while KU Band is established, advancements in satellite technology could offer more efficient or cost-effective solutions over the contract's duration. Furthermore, financial stability of the contractor and geopolitical factors affecting satellite operations could pose risks. The firm fixed-price nature mitigates cost escalation risk for the government, but performance-related risks remain and would necessitate diligent oversight by DISA.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Custom Computer Programming Services

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: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13665 DULLES TECHNOLOGY DR STE 300, HERNDON, VA, 20171

Business Categories: Category Business, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $58,753,055

Exercised Options: $58,753,055

Current Obligation: $58,753,055

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS35F5151H

IDV Type: FSS

Timeline