DoD's $30.3M KU-BAND SPACE SEGMENT contract to ARTEL LLC shows fair value with 3 bidders

Contract Overview

Contract Amount: $30,290,755 ($30.3M)

Contractor: Artel LLC

Awarding Agency: Department of Defense

Start Date: 2013-02-16

End Date: 2017-08-15

Contract Duration: 1,641 days

Daily Burn Rate: $18.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: KU-BAND SPACE SEGMENT

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20191

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $30.3 million to ARTEL LLC for work described as: KU-BAND SPACE SEGMENT Key points: 1. Contract awarded via full and open competition, indicating a competitive bidding process. 2. The contract duration of 1641 days suggests a significant, long-term need for services. 3. The firm-fixed-price contract type helps manage cost certainty for the government. 4. The award to ARTEL LLC, a single contractor, highlights potential concentration risk. 5. The NAICS code 541511 points to custom computer programming services, a key IT function. 6. The contract was awarded as a delivery order under a larger contract vehicle.

Value Assessment

Rating: good

The total contract value of $30.3 million over approximately 4.5 years averages to about $6.7 million annually. Benchmarking this against similar KU-BAND SPACE SEGMENT contracts is challenging without more specific service details. However, the presence of three bidders suggests a degree of market interest and potential for competitive pricing. The firm-fixed-price nature of the award provides cost predictability, which is a positive indicator of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under a full and open competition, meaning all responsible sources were permitted to submit bids. With three bidders participating, the competition level appears moderate. This suggests that while there was interest, the market might not be saturated with providers for this specific service, potentially influencing price discovery.

Taxpayer Impact: A competitive process with multiple bidders generally leads to better pricing for taxpayers by encouraging providers to offer their best terms. The moderate competition here suggests a reasonable balance between attracting qualified vendors and achieving cost savings.

Public Impact

The Department of Defense benefits from secure and reliable KU-BAND SPACE SEGMENT services. This contract supports critical communication infrastructure for military operations. The services likely impact personnel across various defense installations requiring satellite connectivity. The contract contributes to the IT services sector workforce, particularly in specialized programming.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential over-reliance on a single contractor (ARTEL LLC) for critical space segment services.
Limited insight into the specific performance metrics and quality of services delivered.
The duration of the contract could lead to vendor lock-in if not managed carefully.

Positive Signals

Awarded through full and open competition, ensuring a broad range of potential providers.
Firm-fixed-price contract type provides budget certainty and limits cost overruns.
The contract supports essential defense communication infrastructure, indicating strategic importance.

Sector Analysis

The KU-BAND SPACE SEGMENT falls within the broader telecommunications and IT services sector, specifically focusing on satellite communications. This market is characterized by high barriers to entry due to technological complexity and infrastructure requirements. Spending in this area is critical for government agencies, particularly defense, for secure and global connectivity. Comparable spending benchmarks would depend on the specific bandwidth, data rates, and service level agreements required.

Small Business Impact

There is no indication that this contract included small business set-asides, nor is there information on subcontracting plans. The award to ARTEL LLC, a single entity, does not provide immediate insight into opportunities for small businesses within this specific contract's execution. Further analysis would be needed to determine if small businesses are involved in the supply chain or subcontracting.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Information Systems Agency (DISA) and the Department of Defense's contracting oversight mechanisms. Accountability is managed through contract terms, performance reviews, and payment schedules. Transparency is facilitated by contract award databases, though detailed performance data may be less accessible. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Satellite Communications
Information Technology Services
Telecommunications Infrastructure
Network Services
Space-Based Communications

Risk Flags

Moderate Competition
Single Awardee Concentration
Long Contract Duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.3 million to ARTEL LLC. KU-BAND SPACE SEGMENT

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 $30.3 million.

What is the period of performance?

Start: 2013-02-16. End: 2017-08-15.

What is ARTEL LLC's track record with similar government contracts, particularly in satellite communications?

ARTEL LLC has a history of performing telecommunications and IT services for the U.S. government. Their contract portfolio includes various services related to network infrastructure, satellite communications, and IT support for defense agencies. Analyzing their past performance on similar contracts, including any reported issues or commendations, would provide further context on their reliability and capability in delivering KU-BAND SPACE SEGMENT services. Specific details on past contract values, durations, and client agencies would be necessary for a comprehensive assessment of their track record.

How does the per-unit cost or service rate of this contract compare to market benchmarks for KU-BAND SPACE SEGMENT services?

Determining the precise per-unit cost benchmark for this KU-BAND SPACE SEGMENT contract is difficult without granular data on the specific services rendered (e.g., bandwidth per MHz-pop, data throughput, service level agreements). The total award of $30.3 million over 1641 days suggests an average annual spend of approximately $6.7 million. To benchmark effectively, one would need to compare this average spend against industry rates for similar satellite bandwidth and associated services, considering factors like geographic coverage, latency requirements, and redundancy. The moderate competition (3 bidders) suggests pricing might be competitive but not necessarily at the lowest possible market rate.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential service disruptions, contractor performance issues, and technological obsolescence in satellite communications. Given the firm-fixed-price nature, cost overruns are less likely unless scope changes significantly. Mitigation strategies likely involve robust performance monitoring by DISA, clear service level agreements (SLAs), and contingency planning for service continuity. The reliance on a single awardee also presents a concentration risk, which could be mitigated through strong contract management and potentially exploring alternative providers for future requirements.

How effective has this contract been in meeting the Department of Defense's communication needs?

Assessing the effectiveness requires detailed performance data, which is not publicly available. However, the contract's duration (over 4.5 years) and its award through a competitive process suggest it has been meeting essential communication needs. The continued reliance on such contracts indicates a sustained requirement for KU-BAND SPACE SEGMENT services. Effectiveness would be measured against uptime, data integrity, security compliance, and responsiveness to evolving military operational demands. Post-award reviews and user feedback would provide the most accurate measure of effectiveness.

What are the historical spending patterns for KU-BAND SPACE SEGMENT services by the Department of Defense or DISA?

Historical spending on KU-BAND SPACE SEGMENT services by the DoD and DISA has been substantial, reflecting the critical role of satellite communications in modern military operations. This specific contract represents a portion of that broader spending. Analyzing past contracts for similar services would reveal trends in contract values, durations, and the number of competitors over time. Such analysis could indicate whether spending has increased or decreased, and if the market has become more or less concentrated.

What is the geographic scope of the KU-BAND SPACE SEGMENT services provided under this contract?

While the specific geographic coverage is not detailed in the provided data, KU-BAND SPACE SEGMENT services are inherently designed for broad reach, often global or regional, depending on the satellite constellation utilized. For the Department of Defense, these services are typically required to support operations across various theaters, including remote or austere environments where terrestrial infrastructure may be limited or non-existent. The contract likely supports DoD assets and personnel worldwide, ensuring command and control, intelligence, surveillance, and reconnaissance (ISR) capabilities.

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: 3

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: $30,290,755

Exercised Options: $30,290,755

Current Obligation: $30,290,755

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F5151H

IDV Type: FSS

Timeline