Pentagon Names 9 Winners of $6.9 Billion NETCENTS-2 Defense Contract

The Department of Defense announced 11 new defense contracts on Tuesday. That may not sound like much, but thanks to two multibillion-dollar contracts among them, the total value of contracts awarded on the day could surpass $14.18 billion.

The biggest winner of the day was the Bechtel Group. The privately held construction and engineering firm won a "modification" adding $7.1 billion to the value of its contract to perform naval nuclear propulsion work at the Bettis & Knolls Atomic Power Laboratories.

Nearly as lucrative as that contract was a second worth up to $6.9 billion, whose participants are as follows:

  • Federal Network Systems, a Verizon (NYSE: VZ  ) subsidiary
  • Harris'  (NYSE: HRS  ) IT division
  • PCMall, now known as PCM  (NASDAQ: PCMI  )  
  • Insight Enterprises (NASDAQ: NSIT  )
  • Four privately held firms: FCN, Force 3, Presidio Networked Solutions, and Sterling Computers
  • Dell Federal Systems (now also private)

These nine companies have all been awarded places in the firm-fixed-price, multiple-award, indefinite-delivery/indefinite-quantity (IDIQ) Network Centric Solutions-2 (NETCENTS-2) Netcentric Products program. As previously reported, NETCENTS-2 is a U.S. Air Force program. Its purpose is to fund purchases of off-the-shelf commercial products such as networking equipment, servers/storage, multimedia, and software for the U.S. Air Force's Internet Protocol Network.

Companies named as participants in the program are given the right to bid on task orders to fulfill under NETCENTS-2. Prior to today's announcement, 16 other companies had won places under the "umbrella" contract. Thus, today's announcement increases the number of companies vying for a piece of the contract to 25.

The contract's potential size remains $6.9 billion. Its duration still stretches to six years potentially, consisting of an initial three-year base period, to be followed by a potential three one-year-long contract extensions.


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