Jim Wolf
WASHINGTON: The US National Security Agency said on Monday that it planned to
award by the end of next month a landmark contract valued at up to $5 billion
over 10 years to upgrade its non-spying computers and communications backbones.
"We expect to make a contract decision by July 31st," the secretive
Defense Department arm told Reuters in pinning down a timetable for the deal
precisely for the first time. More than 15 companies have formed three alliances
to compete for one of the biggest handoffs to outside contractors of sensitive
work previously reserved to US government employees.
The deal involves providing broadband computer services other than those used
for the agency's core mission of eavesdropping on foreign communications and
cracking foreign codes. Leading the three competing teams are, respectively,
AT&T Corp., Computer Sciences Corp. and privately owned OAO Corp. of
Greenbelt, Maryland.
Primary members of the AT&T team are IBM Corp., Lockheed Martin Corp.,
and employee-owned Science Applications International Corp. CSC's top partners
are Northrop Grumman Corp., General Dynamics Corp. and TRW Inc.
OAO's team includes Electronic Data Systems Corp., Raytheon Corp., Coleman
Research Corp., a unit of L-3 Communications Holdings Inc., Getronics NV
WorldCom Inc. and OAO Technology Solutions Inc. In written replies to questions,
the agency said that, assuming everything went as planned, it expected the
winning team to begin running its information technology infrastructure on or
about November 1, 90 days after the contract award.
Milestone for secretive agency
The contract is a milestone for the National Security Agency, which led research
and development of the world's most powerful computers to carry out its job of
communications interception and guarding classified US networks.
Electronic surveillance networks used by the Fort Meade, Maryland-based
agency to gather "signals" intelligence are not part of Project
Groundbreaker, as the outsourcing program is dubbed. Instead, the government
will hand over responsibility for modernizing the infrastructure that underpins
the agency, offering the winning team financial incentives based on yardsticks
for performance worked out in association with business technology advisory firm
Gartner Group Inc. of Stamford, Connecticut.
In so doing, it will put the winning team in charge of enough cabling to
connect the US East and West Coasts, storage capacity to warehouse the Library
of Congress and computing power equal to communications giants BellSouth and
Sprint combined, agency spokeswoman Lisaanne Davis said.
Specifics about the selection process have not been made public. But the
bid-evaluation process involves three main areas: personnel; technology and
management and price, Davis said. In addition, the agency is mandating that at
least 25 per cent of the project's dollars go to small business subcontractors.
Contract value to be determined
The contract's exact value will be determined at the time of the award, based on
the winner's proposal, the agency said. The winner will be well positioned for
what is expected to be a booming market in outsourcing of such sensitive and
secure services by both the US government and financial services companies,
including banks and insurance companies.
"Gee, if they can provide service to the National Security Agency, they
should be able to provide service to us," said OAO President Emmett Paige,
theorizing on the winner's likely marketing pull. Paige, assistant secretary of
defense for command, control, communications and intelligence from May 1993 to
May 1997, said such outsourcing deals represented the government's best hope for
keeping up with the rapid pace of technology improvement.
On Oct. 6, the Navy awarded EDS an innovative contract worth at least $6.9
billion to create an internal information network linking ships, bases and
service personnel worldwide. That program, to build a Navy-Marine Corps
Intranet, outlined the network's required performance measures without detailing
how the contractor must deliver them.
As the prime contractor, EDS can earn hundreds of millions of dollars extra
if it satisfies individual users, directs large parts of the project to small
businesses and delivers a high, and measurable, degree of network security. It
also may earn billions if all options are exercised.
(C) Reuters Limited 2001.