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NAICS NewsletterMarch 5, 2009

NAICS 517110

Wired Telecommunications Carriers

Government Contract and Procurement Analysis Report

Report Summary

This report, offered by epipeline, contains a brief analysis of the Federal government's procurement practices with regards to purchasing the services of Wired Telecommunications Carriers.


You will find information on the top federal government agencies that purchase these services, as well as their procurement strategy (i.e. full and open competition, set-asides and more). Finally, there is a review of the top companies that are awarded federal government contracts for Wire Telecommunications services.


To get a more comprehensive analysis and learn more about how epipeline can help you identify current and future bid opportunities, register for a live Demo.

This report takes an in-depth look at the 'Wired Telecommunications Carriers' industry, NAICS 517110. To understand the future, one must study the past. epipeline's Contract History Plus* provides you with a broad context and several perspectives that enables you to develop the best positioning and strategy for your company to more effectively compete for government contracts. The following graph illustrates one such perspective: the top Government departments/agencies buying these services over the last four fiscal years

Top 10 Federal Agencies by % of Total Market FY04 - Q2FY08 for NAICS 517110

WHAT IS NAICS 517110?

NAICS 517110 is used when establishments engaged in (1) operating and maintaining switching and transmission facilities to provide point-to-point communications via landlines, microwave, or a combination of landlines and satellite linkups or (2) furnishing telegraph and other non-vocal communications using their own facilities.

The size standard associated with NAICS 517110 is 1,500 employees, which means that a company, including the employees of its domestic and foreign affiliates, would be considered a "small business" if their average number of employees does not exceed 1,500 for each of the pay periods for the preceding completed 12 calendar months. If a company has not been in business for 12 months, the average number of employees is used for each of the pay periods during which it has been in business.

Total reported spending under NAICS 517110 for the period of Fiscal Year 2004 (FY04) through the second quarter (Q2) of Fiscal Year 2008 (FY08 aka Q2FY08) was over $5.42 Billion. With two quarters reported, FY08 reported spending of $171 Million for services under NAICS 517110. The chart below illustrates the reported** spending by year for FY04 through Q2FY08.

Reported Contact Spending FY04 - Q1FY08 for NAICS 517110 Source: epipeline's Contract History Plus*
** Note: it is possible that some Defense spending for the more recent fiscal years (FY05 to present) is not as widely reported as earlier years. These numbers will likely increase as more departments and agencies report their contract spending.

WHO ISSUES THE CONTRACTS?

The Defense Information Systems Agency (DISA) is the largest buyer of services under NAICS 517110, commanding over 32% of the market share for the last four fiscal years (FY04 through Q2FY08), with over $1.75 Billion in contract spending. The United States Air Force and the United States Army also topped the billion dollar mark, with $1.36 Billion and $1.14 Billion, respectively. The Washington Headquarters Services (WHS - part of DoD) was a distant fourth, with only 5.73% of the market share.

Top 10 Federal Agencies by % of Total Market FY04 - Q2FY08 for NAICS 517110 Source: epipeline's Contract History Plus*

WHO WINS THE CONTRACTS?

According to the Central Contractor Registry (CCR), there are 3,515 companies registered under NAICS 517110 (source: active registrants, www.ccr.gov as of 02/11/2009). Of this number, 2,426 qualify as small businesses, which includes the following breakout by socioeconomic categories (some companies may qualify under more than one category):

  • 254 SBA Certified 8(a) contractors;
  • 97 SBA Certified HUBZone contractors; and
  • 272 Service Disabled Veteran Owned Small Businesses (SDVOSB).

NOTE, the CCR website states, "As of the July 30, 2008 release (4.08.2), CCR-registered vendors may elect not to display their registration in the CCR/FedReg Public Search." This could mean that there are more active contractors registered with the CCR then the resulting totals above represent.

The two charts below identify the top 10 Companies, by market share, for the period of FY04 through Q2FY08. The first chart represents the top 10 companies that were awarded their contracts under ANY type of competition, whether it was full and open, small business set-aside, sole-sourced, etc. This list primarily consists of large businesses. The second chart, however, lists the top 10 companies that won their contracts under RESTRICTED competition. Specifically, epipeline limited this to those contracts awarded under the acquisition strategies listed below. The contract dollars represented on this second chart may not include all contract dollars for the individual contractor.

  • 8(a) Competed
  • 8(a) Small Disadvantaged (SDB) set-aside
  • 8(a) sole-source
  • SDB set-aside
  • SDB, 8(a) with HUBZone
  • Combination HUBZone and 8(a)
  • HUBZone set-aside
  • HUBZone sole-source
  • Service Disabled Veteran-Owned Small Business (SDVOSB) set-aside
  • SDVOSB sole-source
  • Emerging Small Business set-aside
  • Very Small Business set-aside
  • Reserved for Small Businesses ($2501 to $100,000)
  • Total Small Business set-aside

GeoVizcom Inc. holds the top spot on the unrestricted competition list with over $602 Million in contract dollars for FY04-Q2FY08 and over 11.3% of the market share. The second company on the list, SI International Engineering Inc., had over 5.3% of the market share with $282 Million in reported contract spending. Telos Corporation, Electronic Data Systems (EDS), Netco Government Services, Inc., and Chenega Technology Services Corporation all held contracts with reported spending over $200 Million. The remaining firms in the top ten, along with three other companies had reported spending topping $100 Million.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 517110 Contractors by % of Total Market for FY04 - Q2FY08 - All Acquisition Strategies Source: epipeline's Contract History Plus*

The top three firms on the previous chart, also find themselves on the following chart, which represents spending under NAICS 517110 for contracts using restricted competition, as outlined above. Chenega Technology Service Corporation (listed in the sixth spot on the chart above) had the highest reported spending with over $232 Million, or 23.2% of the market share for contracts with a restricted acquisition strategy. Indyne Inc. (seventh on the above list) was next, with $193 Million in reported contract spending. The third firm on the restricted chart, SI International Engineering Inc. actually holds the top spot for reported spending under all acquisition strategies. Since the following chart only represents contracts under restricted spending, SI International may hold more and/or higher valued-contracts, which were awarded using full and open competition and/or did not report their acquisition strategy. The remaining firms listed in the top ten, along with seven other companies all held contracts with reported spending above $10 Million for the FY04 through Q2FY08 period.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 517110 Contractors by % of Total Market for FY04 - Q2FY08 - RESTRICTED Competition

HOW ARE THESE CONTRACTS PROCURED?

Seventy percent of contract spending reported for the FY04 through Q2FY08 timeframe under NAICS 517110 used full and open (unrestricted) competition. This equated to over $3.82 Billion. Small Business set-aside contracts represented the second largest segment, with over $665 Million in contract spending for this period. Almost 6% of the market share did not include a designated acquisition strategy, which could include contracts awarded using full and open competition, small business set-aside, or any manner of restriction. Contracts competitively awarded to 8(a) firms and those sole sourced to 8(a) firms combined, reported over $333 Million in contract spending, with sole source contracts taking the lion's share. Contracts set-aside for HUBZone or SDVOSB companies represented a significantly smaller market share, with combined sole source and competitive contracts for these acquisition strategies totaling just over $4 Million for the FY04 - Q2FY08 period.

Acquisition Breakout under NAICS 517110 - FY04 through Q2FY08 Source: epipeline's Contract History Plus*

WHERE ARE THESE CONTRACTS PERFORMED?

These contracts are being performed across the continental United States and abroad. The 50 states plus Washington, DC have reported spending of $5.0 Billion and contracts for locations outside the United States total over $329 Million.

The contracts with a reported place of performance located within Commonwealth of Virginia reported the highest level of spending under this NAICS, with over $2.57 Billion - or 47.4% of the market share. Colorado was a distant second, with a market share of 7.7%, which equated to $419 Million. All of the remaining states (including Washington, DC) in the top ten reported spending over $100 Million, with another 18 states over $10 Million in reported contract spending.

Contract Place of Performance under NAICS 517110 (FY04-Q2FY08)

Source: epipeline's Contract History Plus*

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