DoD's $19.7M 10GB Commercial Lease Awarded to BT Federal Inc. for 5 Years

Contract Overview

Contract Amount: $19,668,879 ($19.7M)

Contractor: BT Federal Inc

Awarding Agency: Department of Defense

Start Date: 2021-01-31

End Date: 2026-03-31

Contract Duration: 1,885 days

Daily Burn Rate: $10.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: GNBT000042EBM - 10GB COMMERCIAL LEASE

Plain-Language Summary

Department of Defense obligated $19.7 million to BT FEDERAL INC for work described as: GNBT000042EBM - 10GB COMMERCIAL LEASE Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract duration of approximately 5 years (1885 days) indicates a long-term need. 3. The award type is a Delivery Order, implying it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. 4. The fixed-price nature of the contract helps mitigate cost overrun risks for the government. 5. The specific service is a 10GB commercial lease, crucial for telecommunications infrastructure. 6. The awarding agency, DISA, is responsible for providing IT and telecommunications support to the DoD. 7. The contract value of $19.7M over its term suggests a significant investment in network capacity.

Value Assessment

Rating: good

The contract value of $19.7 million over approximately five years for a 10GB commercial lease appears reasonable given the duration and service level. Benchmarking against similar large-scale telecommunications leases for government entities would provide a more precise value-for-money assessment. However, the competitive award process suggests that pricing was likely scrutinized against market rates. The fixed-price structure also contributes to predictable spending.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 6 bids suggests a healthy level of competition for this telecommunications service. A competitive process like this generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are likely being used efficiently, as multiple vendors vied to offer the best price and service. This competitive pressure helps prevent inflated pricing and encourages innovation.

Public Impact

The Department of Defense benefits from enhanced and reliable 10GB network connectivity. This lease supports critical telecommunications infrastructure essential for military operations and communication. The service likely impacts personnel within the Department of Defense who rely on robust network services. Geographic impact is likely concentrated around DoD facilities requiring this level of bandwidth. The contract supports the telecommunications sector by providing revenue to BT Federal Inc.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if this lease is a critical component of a larger network architecture.
Dependence on a single vendor for a significant portion of network capacity could pose a risk.
The long-term nature of the contract may limit flexibility to adopt newer, potentially more cost-effective technologies if they emerge rapidly.

Positive Signals

Awarded through full and open competition, indicating a robust selection process.
Fixed-price contract type helps control costs and provides budget certainty.
The contract is with an established vendor, BT Federal Inc., suggesting a degree of reliability.
The service is a critical telecommunications lease, supporting essential DoD functions.

Sector Analysis

This contract falls within the Wired Telecommunications Carriers industry, a sector vital for providing the backbone of digital communication. The market for large-scale commercial leases is competitive, with major telecommunications providers vying for government contracts. Spending in this sector is consistently high due to the ongoing need for robust and high-capacity network infrastructure across all federal agencies. This specific contract represents a significant investment in ensuring high-speed data transmission capabilities for defense operations.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned. Therefore, the direct impact on the small business ecosystem is likely minimal, although BT Federal Inc. may engage small businesses as part of its broader operations. Further analysis of subcontracting plans would be needed to fully assess the impact.

Oversight & Accountability

As a delivery order under a larger contract vehicle, oversight likely resides within the contracting activity at the Defense Information Systems Agency (DISA). The fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

DoD Telecommunications Services
Network Infrastructure Contracts
Commercial Lease Agreements
Wired Telecommunications Services

Risk Flags

Long-term contract duration may limit flexibility.
Dependence on a single vendor for critical infrastructure.
Potential for price increases upon renewal if competition is limited.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.7 million to BT FEDERAL INC. GNBT000042EBM - 10GB COMMERCIAL LEASE

Who is the contractor on this award?

The obligated recipient is BT FEDERAL INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $19.7 million.

What is the period of performance?

Start: 2021-01-31. End: 2026-03-31.

What is the historical spending pattern for similar 10GB commercial leases by the Department of Defense or DISA?

Analyzing historical spending for similar 10GB commercial leases by the Department of Defense (DoD) and its agencies like the Defense Information Systems Agency (DISA) is crucial for context. While specific historical data for identical leases isn't provided, general trends show significant and consistent federal investment in telecommunications infrastructure. Agencies frequently procure high-bandwidth leases to support data-intensive operations, cybersecurity, and global communication networks. The average cost per gigabit per month can fluctuate based on geographic location, contract duration, and competition. For instance, longer-term contracts often secure lower per-unit rates. DISA, in particular, manages vast networks, necessitating substantial spending on leased capacity. Without direct comparative data for this specific contract's period and location, it's challenging to pinpoint exact historical spending patterns, but the overall federal expenditure on such services is in the billions annually.

How does the per-unit cost of this 10GB lease compare to market rates for similar commercial services?

Determining the precise per-unit cost requires breaking down the total contract value ($19,668,879.40) over its duration (approximately 1885 days or 62 months). This yields a monthly cost of roughly $1,043,442. This monthly cost, when divided by 10 Gbps, gives a rate of approximately $104,344 per Gbps per month. Comparing this to market rates for commercial 10Gbps dedicated internet access or leased lines can be complex, as government contracts often have unique requirements and bulk purchasing power. However, general market rates for dedicated 10Gbps circuits can range significantly, from $10,000 to $50,000+ per month depending on the provider, location, service level agreements (SLAs), and contract length. Given this range, the government's rate appears to be at the higher end, suggesting potential for further negotiation or that specific DoD requirements justify the premium. The competitive bidding process should ideally align this cost with market value.

What are the specific performance metrics and Service Level Agreements (SLAs) associated with this 10GB lease?

The provided data does not detail the specific performance metrics or Service Level Agreements (SLAs) for this 10GB commercial lease. However, for a critical telecommunications service supporting the Department of Defense, it is highly probable that stringent SLAs are in place. These typically include guarantees for uptime (e.g., 99.99% availability), latency thresholds, packet loss limits, and rapid response times for service restoration in case of outages. Penalties for failing to meet these SLAs are common, often involving service credits or financial deductions from payments. The fixed-price nature of the contract suggests that the core service delivery is defined, but the quality and reliability are governed by these performance standards. A thorough review of the full contract documentation would be necessary to ascertain the exact SLAs and their implications.

What is BT Federal Inc.'s track record with similar large-scale telecommunications contracts for the federal government?

BT Federal Inc. is the U.S. public sector arm of BT Group, a major global telecommunications company. Their track record with large-scale federal telecommunications contracts is extensive. They have historically secured and managed significant contracts involving network services, managed security, and connectivity solutions for various U.S. government agencies, including defense and civilian departments. Their experience typically encompasses providing high-capacity data circuits, global network management, and secure communication channels. While this specific $19.7 million contract for a 10GB lease is a notable award, it aligns with the company's established capabilities and market position in serving government clients. Past performance data, often available through government contract databases, would provide more granular details on their success rates, contract values, and client satisfaction for similar projects.

What are the potential risks associated with a sole vendor providing such a critical network component?

While this contract was awarded under full and open competition, the fact that BT Federal Inc. is the sole provider for this specific 10GB lease introduces several potential risks. Firstly, there's a risk of vendor lock-in, where the government becomes heavily reliant on BT Federal's infrastructure and pricing structure, making it difficult and costly to switch providers, especially if the lease is deeply integrated into DoD networks. Secondly, if BT Federal experiences financial difficulties or strategic shifts, it could disrupt service delivery. Thirdly, without ongoing competition for this specific service, there's a reduced incentive for the vendor to offer significant price reductions or innovative upgrades beyond the contract's scope. Finally, a single point of failure, such as a major outage affecting BT Federal's network, could have a widespread impact on DoD operations reliant on this lease, underscoring the importance of robust SLAs and contingency planning.

Industry Classification

NAICS: Information › Wired and Wireless Telecommunications (except Satellite) › Wired Telecommunications Carriers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - NETWORK

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 6

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: BT Group PLC

Address: 11440 COMMERCE PARK DR, STE-100, RESTON, VA, 20191

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

Financial Breakdown

Contract Ceiling: $19,668,879

Exercised Options: $19,668,879

Current Obligation: $19,668,879

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC101316D0003

IDV Type: IDC

Timeline