Massive price difference aside, other factors swing DHS modernization award to AT&T

The $400 million-plus differences in price stand out, but other matters drove the Homeland Security Department to pick AT&T over its rivals to lead a modernization effort.

It is hard not to focus on the price difference when looking at Verizon's protest of a Homeland Security Department task order that went to AT&T, but there is more to the story than just the dollars involved.

There was a whopping $442.9 million difference between Verizon’s bid to modernize DHS' telecommunications networks and that of AT&T. That gap grows to $469.2 million when comparing the bids of Lumen Technologies (formerly CenturyLink) and AT&T.

AT&T’s winning bid was priced at $306.2 million and Lumen (bidding as Qwest) submitted a $279.9 million offer. Verizon came in at $749.1 million.

Verizon used the price difference to argue it was not bidding on an even playing field with its competitors.

Verizon also argued DHS failed to hold meaningful discussions regarding its price on the task order that was competed under the Enterprise Infrastructure Solutions contract vehicle.

AT&T scored slightly better technical evaluation as well, which Verizon contends was “unreasonable and unequal.”

In a separate protest, Lumen argued the evaluation was unreasonable and that “proper discussions” were not conducted.

But Verizon’s and Lumen’s arguments came up short as the Government Accountability Office rejected both protests.

Arguing Over Price

Verizon did not argue that AT&T’s price were unrealistically low. They also didn’t argue that they couldn’t do the work for the price bid or that the low prices represented a risk, according to the GAO report.

Verizon instead called them “irreconcilable and erratic” and that AT&T priced something very different than Verizon, which gave AT&T an unfair advantage.

But DHS countered that all the bidders used the same price workbooks and the same requirements. “The submitted prices were based on each offeror’s independent business judgments regarding the discounts they elected to offer from their EIS contract pricing,” GAO wrote.

Verizon argued that the differences in the prices show that the bidders did not have a common understanding of the requirements. But GAO said “the protester does not identify any specific parts of the (request for proposals) which it asserts are vague, or ambiguous, or that otherwise prevented offerors from competing on a common basis."

Challenging the Evaluation

Lumen’s transition plan was dinged by DHS because it was a “like for like” plan and didn’t include modernization aspects. That decreased DHS’ confidence in the Lumen approach because it delayed modernization efforts, according to GAO's report on that protest.

The company tried to argue it had the same modernization efforts during the transition as AT&T. But DHS also apparently was swayed by the company’s statement that it would provide the department with “the same services it has today,” GAO said in quoting from DHS’s response to the protest.

Lumen fell short because its proposal wasn’t clear about its modernization efforts. The bid inconsistent because it had “differing statements in different places regarding its modernization schedule," GAO said.

Regarding Verizon, DHS said the company put too much emphasis on managed network services in its proposal despite the agency's intent to order them in limited circumstances. Verizon did propose deployment of software defined wide area network, but GAO said details of the deployment were unclear.

AT&T’s proposal received strengths including for key personnel, transition schedule and modernization efforts.

Unequal Discussions

Verizon argued that DHS failed to raise both elements of the company's bid that decreased the agency’s confidence. Without raising those issues, Verizon said DHS’ discussions were not meaningful,

DHS did raise concerns about Verizon’s prices being high, then the company lowered its price to $749.1 million. But then Verizon complained that DHS should have disclosed the magnitude of difference between its price and those of AT&T and Lumen.

GAO disagreed and said DHS did nothing to mislead Verizon about its proposed price.

Lumen also argued the discussions didn’t give it a chance to address areas where DHS had less confidence in the company. If it had, Lumen could have addressed those issues. But Lumen could not show GAO that it was prejudiced by the discussions or lack thereof.

Best Value Determination

Verizon’s argument fell short on this point, in part because the shortcomings it found in the evaluation were not relied on by the source selection authority.

The authority instead leaned on the strengths it found in AT&T’s proposal. Verizon didn’t challenge those strengths.

Given the huge price difference, GAO said that even if Verizon had the same technical scores as AT&T, a best value determination still would favor AT&T because Verizon never attacked the quality of AT&T’s proposal.

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.