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Navy Ups Value of HP Network Bridge Contract by $1.2 Billion

sheelamohanachandran2010/Shutterstock.com

The Department of the Navy said it will increase the ceiling value of its Naval Marine Corps Internet bridge contract with HP Enterprise Services from $4.9 billion to $6.1 billion, with an option to extend it from April 2014 to September 2014.

Navy spokesman Ed Austin said the service boosted the value of the NMCI Continuity of Services Contract and added the extension option to ensure that it can complete transition to its $5 billion Next Generation Enterprise Network -- or NGEN -- contract.

The Navy originally planned to award NGEN by the end of 2012, but last month delayed the award until May to “ensure a complete and thorough review of offerors’ bids,” Austin said. For the NGEN bid, HP partnered with AT&T, IBM, Lockheed Martin Corp. and Northrop Grumman; Computer Sciences Corp. partnered with Harris, Dell, General Dynamics and Verizon.

HP Enterprise Services won the $10 billion NMCI contract, which serves 750,000 Navy and Marine users, in 2000. The Navy ramped up its NGEN project and awarded the company its first bridge contract, valued at $3.4 billion, in July 2010, followed by another extension valued at $1.5 billion, for a total value of $4.9 billion, in October 2012.

The Navy estimates that the NMCI Continuity of Services Contract will exceed that $4.9 billion ceiling this September, though the contract runs through April 2014, Austin said.

The increase in the ceiling value of the NMCI bridge contract does not mean the service intends to extend it but rather is a “prudent step” that will allow the Navy to “to manage potential changes associated with the NGEN acquisition and transition,” Austin said. “Any interruption in network services during the acquisition and transition to NGEN is not acceptable."

(Image via sheelamohanachandran2010/Shutterstock.com)

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