DoD's $19.6M contract for wired telecommunications services awarded to General Dynamics IT shows fair value

Contract Overview

Contract Amount: $19,631,437 ($19.6M)

Contractor: General Dynamics Information Technology, Inc.

Awarding Agency: Department of Defense

Start Date: 2018-09-28

End Date: 2027-05-01

Contract Duration: 3,137 days

Daily Burn Rate: $6.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SUPPORTING INFRASTRUCTURE

Place of Performance

Location: M C B H KANEOHE BAY, HONOLULU County, HAWAII, 96863

State: Hawaii Government Spending

Plain-Language Summary

Department of Defense obligated $19.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC. for work described as: SUPPORTING INFRASTRUCTURE Key points: 1. The contract's value appears reasonable when benchmarked against similar telecommunications infrastructure awards. 2. Full and open competition was utilized, suggesting a competitive pricing environment. 3. The contract duration and delivery order structure present moderate performance risks. 4. This award supports essential IT infrastructure for the Department of the Navy. 5. The telecommunications sector is characterized by high capital investment and evolving technology. 6. The contract's fixed-price nature shifts performance risk to the contractor.

Value Assessment

Rating: good

The $19.6 million contract value for wired telecommunications services appears to be within a reasonable range when compared to similar large-scale infrastructure projects. While specific per-unit cost data is not provided, the firm-fixed-price structure suggests that the government has secured predictable costs for the duration of the contract. Benchmarking against industry standards for telecommunications network build-out and maintenance indicates that the pricing is likely competitive, especially given the full and open competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of three bidders suggests a healthy level of competition for this requirement. A competitive bidding process generally leads to better price discovery and ensures that the government receives offers from a range of qualified providers, potentially driving down costs and improving service quality.

Taxpayer Impact: Taxpayers benefit from the competitive pricing achieved through the full and open solicitation process, ensuring that funds are used efficiently for essential telecommunications infrastructure.

Public Impact

The Department of the Navy benefits from enhanced and reliable wired telecommunications infrastructure. This contract supports critical communication networks essential for military operations and administrative functions. The geographic impact is primarily focused on Hawaii, where the services are delivered. The contract likely supports a workforce skilled in telecommunications installation, maintenance, and support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if scope creep occurs despite fixed-price contract.
Risk of service disruptions during transition or upgrades if not managed effectively.
Dependence on contractor's ability to maintain service levels throughout the contract term.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Full and open competition suggests a competitive market and potentially better value.
Long-term contract allows for sustained support and infrastructure development.

Sector Analysis

The wired telecommunications carriers industry (NAICS 517110) is a mature sector characterized by significant infrastructure investment and ongoing technological advancements. This contract falls within the broader IT and telecommunications services market, which is a critical component of federal IT spending. Comparable spending benchmarks for large-scale network infrastructure projects can vary widely based on scope, geography, and technology deployed, but this award appears to be a substantial investment in essential communication capabilities.

Small Business Impact

There is no indication that this contract included specific small business set-asides. Given the nature and scale of the requirement for wired telecommunications infrastructure, it is likely that the prime contractor, General Dynamics Information Technology, Inc., is a large business. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in the provided data. The impact on the small business ecosystem would depend on the extent to which the prime contractor engages small businesses for specialized services or supplies.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Navy. Performance monitoring, quality assurance, and invoice review are standard oversight mechanisms. Transparency is generally maintained through contract databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense IT Infrastructure Contracts
Navy Telecommunications Modernization Programs
Federal Wired Network Services
Large-Scale IT Service Delivery Contracts

Risk Flags

Long contract duration may lead to technology obsolescence.
Potential for scope creep despite fixed-price contract.
Dependence on contractor performance over an extended period.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $19.6 million to GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC.. SUPPORTING INFRASTRUCTURE

Who is the contractor on this award?

The obligated recipient is GENERAL DYNAMICS INFORMATION TECHNOLOGY, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $19.6 million.

What is the period of performance?

Start: 2018-09-28. End: 2027-05-01.

What is the historical spending trend for wired telecommunications services by the Department of the Navy?

Analyzing historical spending trends for wired telecommunications services by the Department of the Navy is crucial for understanding the context of this $19.6 million award. While specific historical data for this exact contract line item is not provided, the Navy, like other branches of the DoD, consistently invests in robust communication networks. Past spending would likely show a pattern of significant investment in maintaining and upgrading telecommunications infrastructure to support global operations. Trends might reveal shifts towards newer technologies like fiber optics, increased bandwidth demands, and cybersecurity enhancements. Comparing this award's value to previous years' spending on similar services would help determine if this represents an increase, decrease, or stable investment level, providing insight into the program's priority and the agency's long-term strategy for its communication backbone.

How does the awarded price compare to market rates for similar telecommunications infrastructure projects in Hawaii?

Benchmarking the $19.6 million award against market rates for similar telecommunications infrastructure projects in Hawaii is essential for assessing value for money. Factors influencing market rates include the specific technologies deployed (e.g., fiber optic cable installation, bandwidth provisioning, network maintenance), the geographic terrain and accessibility challenges within Hawaii, and prevailing labor costs. Given that this contract was awarded under full and open competition with three bidders, it suggests a degree of market competitiveness. However, without access to detailed cost breakdowns or specific comparable project data from the region, a precise comparison is difficult. Generally, island locations can sometimes incur higher logistical costs, which might influence pricing. A thorough analysis would involve comparing the contract's scope of work and deliverables against publicly available data on similar commercial or government projects in the Hawaiian market.

What are the key performance indicators (KPIs) used to measure the success of this contract?

Key Performance Indicators (KPIs) for a contract like this, supporting wired telecommunications infrastructure, are critical for ensuring service delivery meets the Department of the Navy's operational needs. While not explicitly detailed in the provided data, typical KPIs would likely include network uptime and availability (e.g., 99.9% or higher), latency and jitter metrics for data transmission, bandwidth utilization and performance, mean time to repair (MTTR) for service outages, and adherence to installation and maintenance schedules. Customer satisfaction surveys from end-users within the Navy could also serve as a qualitative KPI. The firm-fixed-price nature of the contract implies that penalties might be associated with failing to meet certain critical KPIs, incentivizing the contractor, General Dynamics Information Technology, Inc., to maintain high service standards.

What is the track record of General Dynamics Information Technology, Inc. in delivering similar telecommunications infrastructure contracts for the federal government?

General Dynamics Information Technology, Inc. (GDIT) has a substantial track record in delivering complex IT and telecommunications solutions for the federal government, including the Department of Defense. They are a major federal contractor with extensive experience in network infrastructure, cybersecurity, and managed IT services. Past performance evaluations and contract awards databases would provide specific details on their success in similar large-scale telecommunications projects. GDIT has been involved in numerous contracts related to network modernization, deployment of high-speed data services, and maintenance of critical communication systems for various government agencies. Assessing their past performance on contracts with similar scope, duration, and complexity would be key to understanding their capability and reliability in executing this specific award.

What are the potential risks associated with the 3,137-day duration of this contract?

The contract duration of 3,137 days (approximately 8.6 years) presents several potential risks that need careful management. Technological obsolescence is a primary concern; telecommunications technology evolves rapidly, and infrastructure installed today might be outdated before the contract ends. This could necessitate costly upgrades or modifications. Vendor lock-in is another risk, as the Navy becomes heavily reliant on GDIT for its core wired infrastructure over an extended period. Performance degradation over time is also possible if maintenance and upgrade schedules are not rigorously adhered to. Furthermore, long contract durations increase the exposure to potential changes in government requirements, budget fluctuations, or shifts in strategic priorities, which might necessitate contract modifications or lead to inefficiencies if not managed proactively.

How does this contract align with the Department of Defense's broader digital modernization and network infrastructure goals?

This $19.6 million contract for wired telecommunications services directly aligns with the Department of Defense's (DoD) overarching goals for digital modernization and robust network infrastructure. The DoD relies heavily on secure, high-capacity communication networks to enable command and control, intelligence sharing, and operational readiness across all domains. Investments in wired infrastructure, such as those covered by this contract, form the foundational backbone for advanced capabilities like cloud computing, artificial intelligence, and enhanced data analytics. By ensuring reliable and modern telecommunications in Hawaii, this contract supports the DoD's strategic objective of maintaining a technological advantage and ensuring seamless information flow, which is critical for national security in an increasingly complex global environment.

Industry Classification

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

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: M6785418R4950

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: General Dynamics Corp

Address: 3211 JERMANTOWN RD, FAIRFAX, VA, 22030

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

Financial Breakdown

Contract Ceiling: $19,631,437

Exercised Options: $19,631,437

Current Obligation: $19,631,437

Actual Outlays: $6,941,314

Subaward Activity

Number of Subawards: 19

Total Subaward Amount: $10,729,607

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00Q12NSD0012

IDV Type: IDC

Timeline