N/MCI backup contractor in question
- By George I. Seffers
- Oct 09, 2000
Although Navy officials said Friday that they would name a backup contractor
for the Navy/Marine Corps Intranet, they apparently have not yet done so.
Electronic Data Systems Corp. on Friday won the highly contested contract — a nearly $7 billion project designed to replace a hodgepodge of systems
with a seamless network owned and operated by the commercial sector.
The plan, according to the Navy, is to have one of the other three competitors
act as a backup in case EDS cannot fulfill program requirements.
But at least one competitor — General Dynamics Corp. — chose not to compete
for the fill-in position, and neither EDS nor Computer Sciences Corp. has
been notified about who the backup is.
IBM Corp., the fourth competitor for the program, could not be reached for comment.
A Navy spokeswoman said today that the Navy "maintained the plan and the backup proposals,
but as yet [has] not named the backup contractor."
Some industry sources speculated that the Navy might have decided against
the backup strategy, despite Friday's announcement, and others question
whether it would be a workable strategy.
"Unless Congress or the N/MCI program office has some very stringent rules
they will use to measure [whether EDS falters], and unless they have the
processes in place to take the measurements, and they have the strength
of conviction to change out the winner for another prime, I believe the
backup strategy is not likely to be executed anytime soon. Time will tell,"
said one industry source.
EDS had the lowest bid — $6.9 billion — for a contract that had been estimated
to be worth as much as $16 billion.
Military officials and analysts say N/MCI is the largest government IT contract
ever awarded. The intranet will be used for sending and accessing information
of all kinds, including ordering supplies, informing commanders of battlefield
conditions, and enabling sailors to access individual medical records.
"This is a pivotal moment in the Department of Defense. This is the most
revolutionary idea so far in re-engineering how we do business," said Arthur
Money, the Pentagon's chief information officer.
Rudy de Leon, deputy secretary of Defense, also praised the Navy program.
"The Navy/Marine Corps Intranet will revolutionize the way that we look
at the process of sharing information," de Leon said. "It gets the government
out of the business of owning and operating information technology systems
and instead transfers that function to a fee-for-service contract with private
industry. The potential for increased efficiency, standardization, interoperability
and better business processes is tremendous."
Navy and Pentagon officials acknowledged in a press briefing Friday that
the program still faces many more challenges. One analyst said the program
already has "had more twists and turns than a [John] Grisham novel."
Many of those plot twists centered on Congress, where some members faulted
the Navy for lack of accurate cost information. In recent weeks, lawmakers
forced the service to delay announcing the contract winner while seeking
answers to questions about how Navy depots might be affected.
However, Navy Secretary Richard Danzig reported that the service has ironed
out all issues with Congress.
Danzig said the Navy's current IT budget is about $1.6 billion and that
the service will pay for N/MCI by no longer allowing organizations within
the two services to build their own disparate networks.