The Navy released its long-awaited request for proposals (RFP) yesterday for the follow-on program to the Navy Marine Corps Intranet (NMCI) after months of delays meant to promote an effective industry competition for the largest information technology network in the U.S. government.
The two contracts for the Next Generation Enterprise Network (NGEN) could reach a value of $10 billion over the next five years. The Navy has asked companies to submit bids by July 18 and anticipates awarding the contracts in February, two months later than planned.
“The release of the RFP is a significant milestone and it reflects critical insight from industry as we compete the world’s largest enterprise network,” Capt. Shawn Hendricks, the program manager at Space and Naval Warfare Systems Command (SPAWAR), said in a statement.
Hewlett-Packard [HP] is currently prime contractor for NMCI and the incumbent has partnered with Northrop Grumman [NOC], IBM [IBM] and AT&T [T] to submit a bid for NGEN. Lockheed Martin [LMT] had been considering to prime bid but recently announced it would instead join the HP team.
“Having operated the Navy’s largest and most secure IT network for more than a decade, HP is the best-suited of any bidders to provide the most seamless, lowest risk, and most cost-effective delivery of NGEN services for the Department of the Navy’s current and future IT needs,” said Bill Toti, HP’s vice president for Navy and Marine Corps programs.
HP hopes to fend off a challenge by Harris Corp. [HRS] and Computer Sciences Corp. [CSC], which have teamed along with General Dynamics [GD] and Verizon Communications [VZ].
“We’re confident we’ve had the right NGEN team from the start–one optimally designed to support the Navy and Marine Corps warfighter,” said Heather Williams, a spokeswoman for CSC. “With improving the customer experience at a fair and reasonable cost point as our objective, we strategically sought teammates with world class records of experience supporting ashore and afloat forces … .” She noted that Harris is currently contracted on NMCI.
The final RFP had been expected in December, but the Navy put off the release. Citing the magnitude of the program, Navy officials have said they wanted to ensure they received plenty of feedback from industry to get the requirements right and to create a fair and effective competition. The service had since issued additional draft RFPs.
“The comments from our ongoing dialogue with industry were carefully reviewed and reflected in the government’s position in the NGEN RFP,” Hendricks said.
SPAWAR spokesman Steven Davis said even though awarding the contracts has been pushed back to February, he does not anticipate it will have a significant impact on the plan to begin fielding NGEN by April 2014.
NGEN is intended to provide secure, net-centric data and services to the Navy and Marine Corps personnel. NMCI serves more than 700,000 users, consists of 384,000 workstations and laptop computers and represents about 70 percent of all Navy information technology operations. NMCI began in 2000 to consolidate the Navy’s and Marine Corps networks. HP inherited the contract when it acquired Electronic Data Systems in 2008.
SPAWAR is competing two separate contracts under the program, one for enterprise services and the other for transport services, but it’s possible one bidding team can win both.
The Navy earlier revised the requirements to lower the threshold companies have to meet to attract more bidders. It was originally planned that bidders demonstrate experience at operating a network with a minimum of 100,000 user stations, but that was dropped to 40,000.
The RFP stuck with plans to use the “lowest-price technically-acceptable (LPTA)” acquisition model, which automatically awards the contracts to the team that meets the minimum requirements and offers the lowest price.
HP last October criticized the use of that model, saying it leaves little flexibility to account for the need to insert new technology into the NGEN over time, counter emerging or unforeseen cyber threats, and adapt to changing environments, which could lead to added costs in future years (Defense Daily, Oct. 6, 2011). HP said it believes the award should instead be guided by the “best value” source selection option, which allows a trade-off between cost and technical capability.
Hendricks has previously rejected the criticism, saying the Navy already has a firm hand on the requirements and does not need additional capabilities that are not clearly defined or priced (Defense Daily, Oct. 31). He said he expects HP to have an advantage over its rivals in the competition given its experience on NMCI.