DoD Awards Leidos $64M for GSM-O II Operations & Sustainment
Contract Overview
Contract Amount: $64,261,084 ($64.3M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2025-11-19
End Date: 2026-11-18
Contract Duration: 364 days
Daily Burn Rate: $176.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIXED PRICE INCENTIVE
Sector: IT
Official Description: GSM-O II OPERATIONS AND SUSTAINMENT
Place of Performance
Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $64.3 million to LEIDOS, INC. for work described as: GSM-O II OPERATIONS AND SUSTAINMENT Key points: 1. Leidos secures a significant contract for critical defense IT operations. 2. The contract value is substantial, reflecting the importance of the services. 3. Full and open competition was utilized, suggesting a competitive bidding process. 4. The fixed-price incentive contract type aims to balance cost and performance. 5. This award falls within the Computer Facilities Management Services sector.
Value Assessment
Rating: good
The contract value of $64.26 million for a one-year term appears reasonable for complex IT operations and sustainment services. Benchmarking against similar large-scale IT support contracts would provide further validation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The use of full and open competition suggests that multiple vendors had the opportunity to bid, likely leading to competitive pricing. The award mechanism as a delivery order under a larger contract structure is common for ongoing service needs.
Taxpayer Impact: Taxpayer funds are being utilized for essential defense IT infrastructure, with the competitive nature of the award aiming to ensure value for money.
Public Impact
Ensures continued operational readiness for critical Department of Defense communication networks. Supports the Defense Information Systems Agency's mission through essential IT services. Potential for technological advancements and efficiencies through the fixed-price incentive structure. Impacts personnel and resources within the defense IT sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Fixed-price incentive contracts can lead to cost overruns if not managed carefully.
- Reliance on a single contractor for critical operations poses a potential risk.
- The contract duration is relatively short (one year), requiring frequent re-competition or extension.
Positive Signals
- Full and open competition promotes market fairness and potentially lower prices.
- The contract supports vital national security functions.
- The fixed-price incentive structure can incentivize contractor performance.
Sector Analysis
This contract falls under Computer Facilities Management Services, a crucial segment within the broader IT sector supporting government operations. Spending in this area is consistently high due to the increasing reliance on digital infrastructure and cybersecurity.
Small Business Impact
While this contract was awarded through full and open competition, it is unclear if small businesses were involved as subcontractors. Large prime contractors often utilize small business partners, but their participation is not explicitly detailed here.
Oversight & Accountability
The Department of Defense and the Defense Information Systems Agency are responsible for overseeing this contract. Robust oversight mechanisms are crucial to ensure performance, manage costs, and mitigate risks associated with fixed-price incentive contracts.
Related Government Programs
- Computer Facilities Management Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Potential for cost overruns with fixed-price incentive contracts.
- Contract duration is limited to one year, requiring future procurement actions.
- Lack of detail on small business subcontracting participation.
- Dependency on a single contractor for critical IT operations.
Tags
computer-facilities-management-services, department-of-defense, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $64.3 million to LEIDOS, INC.. GSM-O II OPERATIONS AND SUSTAINMENT
Who is the contractor on this award?
The obligated recipient is LEIDOS, 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 $64.3 million.
What is the period of performance?
Start: 2025-11-19. End: 2026-11-18.
What specific performance metrics are tied to the incentive portion of this contract, and how will they be measured to ensure optimal value?
The specific performance metrics for the incentive portion are not detailed in the provided data. Typically, these metrics relate to service availability, response times, system uptime, and security compliance. The Defense Information Systems Agency would establish clear, measurable, achievable, relevant, and time-bound (SMART) goals. Regular performance reviews and audits would be conducted to track progress against these metrics and determine incentive payouts, ensuring contractor accountability and value for taxpayer investment.
What are the potential risks associated with Leidos's sole reliance on this contract for a significant portion of their revenue, and how might this impact their focus on performance?
While Leidos is a large company, a significant contract like this could create a dependency. If performance falters, the financial repercussions could be substantial, potentially impacting their ability to invest in other areas or maintain a diverse client base. However, the fixed-price incentive structure is designed to align Leidos's financial interests with strong performance, theoretically mitigating risks by rewarding success and penalizing failure, thus encouraging focus on contract objectives.
How does the Computer Facilities Management Services benchmark for this contract compare to industry standards, and does the fixed-price incentive structure adequately account for potential cost fluct
Without specific benchmark data for this particular service category and contract size, a precise comparison is difficult. However, the $64 million value for a year of operations and sustainment suggests a substantial undertaking. The fixed-price incentive structure aims to control costs by setting a target price and sharing savings or overruns. This structure is generally effective in managing predictable costs but may require careful negotiation and monitoring to account for unforeseen technical challenges or market shifts.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Facilities Management Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: HC102818R0024
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Parent Company: Leidos Holdings, Inc.
Address: 11951 FREEDOM DR FL 15, RESTON, VA, 20190
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $73,025,912
Exercised Options: $73,025,912
Current Obligation: $64,261,084
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: HC102820D0001
IDV Type: IDC
Timeline
Start Date: 2025-11-19
Current End Date: 2026-11-18
Potential End Date: 2030-11-18 00:00:00
Last Modified: 2026-01-12
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