DoD's $26M satellite communications contract awarded to MEDIA BROADCAST GMBH shows fair value with 2 bidders

Contract Overview

Contract Amount: $26,091,074 ($26.1M)

Contractor: Media Broadcast Gmbh

Awarding Agency: Department of Defense

Start Date: 2014-09-24

End Date: 2023-03-23

Contract Duration: 3,102 days

Daily Burn Rate: $8.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::OT::IGF SATELLITE END-TO-END SERVICE FOR AFN-EUROPE

Place of Performance

Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $26.1 million to MEDIA BROADCAST GMBH for work described as: IGF::OT::IGF SATELLITE END-TO-END SERVICE FOR AFN-EUROPE Key points: 1. The contract demonstrates a reasonable value for satellite telecommunications services, aligning with market expectations. 2. Competition was robust, with two bidders vying for the contract, suggesting a healthy market for these services. 3. The fixed-price nature of the contract mitigates cost overrun risks for the government. 4. Performance is tied to a definitive contract, indicating a clear scope of work and deliverables. 5. This contract positions the Defense Information Systems Agency within the broader defense sector's need for secure communication. 6. The duration of the contract suggests a long-term need for these critical satellite services.

Value Assessment

Rating: good

The contract's total value of approximately $26 million over its period of performance appears reasonable when benchmarked against similar satellite telecommunications contracts. The firm-fixed-price structure provides cost certainty. While specific per-unit cost data is not available, the competitive nature of the award suggests that the pricing achieved was likely competitive.

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 two bidders suggests a moderate level of competition for this specific requirement. While more bidders could potentially drive prices lower, two bidders still provide a basis for price discovery and comparison.

Taxpayer Impact: The full and open competition, even with two bidders, ensures that taxpayer funds are used efficiently by leveraging market forces to obtain a fair price for essential satellite services.

Public Impact

The Department of Defense benefits from reliable satellite telecommunications for its European operations. Secure and continuous communication services are delivered to support military readiness and command and control. The geographic impact is focused on supporting U.S. military forces and operations in Europe. The contract supports specialized roles within the telecommunications industry, potentially involving skilled technicians and engineers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if follow-on contracts are not competitively procured.
Reliance on a single contractor for critical communication infrastructure could pose a risk if performance degrades.
Geopolitical factors in Europe could impact service delivery or require adaptive communication strategies.

Positive Signals

The firm-fixed-price contract type provides cost predictability.
Award under full and open competition suggests a competitive market for these services.
The long contract duration indicates a stable and ongoing requirement, allowing for efficient resource planning.
The contractor has a defined period to establish and maintain service delivery.

Sector Analysis

This contract falls within the satellite telecommunications sector, a critical component of the broader IT and defense industries. The market for satellite services is characterized by high barriers to entry due to technological complexity and infrastructure investment. Spending in this area is driven by government and commercial demand for global connectivity, data transmission, and broadcasting. Comparable spending benchmarks would involve analyzing other large-scale government contracts for satellite bandwidth, ground station services, and end-to-end communication solutions.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the specialized nature of satellite telecommunications, it is common for prime contracts to be awarded to large, established companies. However, the prime contractor, MEDIA BROADCAST GMBH, may engage small businesses for subcontracting opportunities related to specific components, installation, or support services, contributing to the broader small business ecosystem.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Information Systems Agency (DISA) and potentially the relevant Inspector General's office within the Department of Defense. Contract performance would be monitored against the terms and conditions of the definitive contract, including service level agreements and delivery schedules. Transparency is facilitated through contract databases and reporting requirements, though specific operational details may remain classified.

Related Government Programs

Defense Information Systems Agency (DISA) Contracts
Satellite Communications Services
European Command (EUCOM) Support
DoD IT Infrastructure
Secure Communications Networks

Risk Flags

Long contract duration may lead to technological obsolescence.
Potential for price increases if market rates decrease significantly over the contract term.
Reliance on a single provider for critical infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.1 million to MEDIA BROADCAST GMBH. IGF::OT::IGF SATELLITE END-TO-END SERVICE FOR AFN-EUROPE

Who is the contractor on this award?

The obligated recipient is MEDIA BROADCAST GMBH.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $26.1 million.

What is the period of performance?

Start: 2014-09-24. End: 2023-03-23.

What is the historical spending pattern for satellite telecommunications services by the Department of Defense in Europe?

Historical spending on satellite telecommunications by the DoD in Europe has been substantial and consistent, reflecting the enduring need for robust communication infrastructure to support military operations, intelligence gathering, and diplomatic engagements. While specific figures fluctuate year-to-year based on evolving threats, technological advancements, and strategic priorities, the overall trend indicates a significant and ongoing investment. This spending encompasses a range of services, including dedicated bandwidth, secure data transmission, voice communications, and mobile satellite solutions. Contracts are often long-term to ensure continuity and leverage economies of scale. The data for this specific contract, valued at approximately $26 million over its term, fits within this broader pattern of sustained investment in ensuring reliable connectivity for U.S. forces and assets operating within the European theater.

How does the pricing of this contract compare to similar satellite telecommunications contracts awarded by other federal agencies?

Benchmarking the pricing of this $26 million satellite telecommunications contract requires access to detailed cost breakdowns and service level agreements, which are not publicly available. However, given that it was awarded under full and open competition with two bidders, the pricing is presumed to be competitive within the market. Generally, federal agencies procure satellite services through various contract vehicles, including indefinite-delivery/indefinite-quantity (IDIQ) contracts and direct awards. Pricing can vary significantly based on factors such as bandwidth requirements, geographic coverage, service level agreements (SLAs), encryption levels, and contract duration. Contracts with longer terms and higher service guarantees typically command higher prices. Without direct comparative data on similar service scopes and durations from other agencies, a precise comparison is challenging, but the competitive award suggests a fair market price was achieved for the specified services.

What are the key performance indicators (KPIs) associated with this satellite telecommunications contract?

Key Performance Indicators (KPIs) for satellite telecommunications contracts typically focus on ensuring the reliability, availability, and performance of the communication links. For this contract, specific KPIs would likely include metrics such as: 1. **Availability:** The percentage of time the satellite link is operational and accessible (e.g., 99.9% uptime). 2. **Latency:** The delay in data transmission, crucial for real-time applications (e.g., measured in milliseconds). 3. **Throughput/Bandwidth:** The data transfer rate achieved, ensuring sufficient capacity for the intended use (e.g., Mbps). 4. **Jitter:** Variation in the delay of data packets, important for voice and video quality. 5. **Packet Loss:** The percentage of data packets that fail to reach their destination. 6. **Service Restoration Time:** The time taken to restore service in case of an outage. These KPIs are critical for ensuring that the Department of Defense receives the quality of service necessary for its operations in Europe. The firm-fixed-price nature of the contract implies that the contractor is incentivized to meet these performance standards to avoid penalties or ensure future contract awards.

What is the track record of MEDIA BROADCAST GMBH in providing similar satellite telecommunications services to the U.S. government?

Assessing the track record of MEDIA BROADCAST GMBH requires a review of their past performance on U.S. government contracts. While this specific contract is a significant award, information regarding their prior experience, past performance evaluations, and history with the Department of Defense or other federal agencies is crucial for a comprehensive understanding. Publicly available data may indicate previous awards, contract types, and durations. A thorough analysis would involve examining performance metrics from previous contracts, any documented issues or successes, and their overall reputation within the defense contracting community. Without specific details on their prior engagements, it is difficult to definitively assess their established track record for delivering complex satellite telecommunications solutions to the U.S. government, particularly in demanding operational environments like Europe.

What are the potential risks associated with the long duration (over 8 years) of this contract?

The long duration of this contract, spanning over 8 years (from September 2014 to March 2023), presents several potential risks. Firstly, technological obsolescence is a significant concern; satellite technology evolves rapidly, and a contract locked into older specifications might not leverage the most efficient or secure advancements. Secondly, market conditions and pricing can change substantially over such a long period. The firm-fixed-price nature mitigates immediate cost escalation, but it might prevent the government from benefiting from potential future price reductions if market rates decrease. Thirdly, contractor performance can degrade over time, or the contractor's financial stability could be impacted, posing a risk to service continuity. Finally, strategic requirements of the Department of Defense may shift, making the contracted services less relevant or requiring costly modifications. Robust oversight and contract management are essential to mitigate these long-term risks.

Industry Classification

NAICS: Information › Satellite Telecommunications › Satellite Telecommunications

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

Solicitation ID: HC102114R0002

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: JOSEPH-SCHUMPETER-ALLEE 17, BONN

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

Financial Breakdown

Contract Ceiling: $30,123,196

Exercised Options: $26,091,077

Current Obligation: $26,091,074

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline