Report: Spending on IT contracts surges in 2004

The federal government awarded $155 billion in IT prime contracts in fiscal 2004, a 60 percent increase over IT-related spending in 2003, according to Reston, Va., market research firm Input Inc.

Input released its end-of-the-year analysis on federal IT spending yesterday, titled "FY2004: Where Did the Money Go?" The analysis, which reviews more than 1,100 IT-related program awards spanning 15 primary IT product and service categories, shows that five federal agencies ? the Defense and Homeland Security departments, the Army, Navy and Air Force ? accounted for $118 billion of the total $155 billion in federal contracts.

The Navy awarded $36.8 billion in IT prime contracts in 2004, compared with $34.3 billion from the Army, $18.3 billion at Defense, $16.5 billion by the Air Force and $12.2 billion at Homeland Security.

The prime contracts fell under three main service areas: research and development, professional services and network and telecom services.

Two major military network/telecom contracts account for most of the $19.2 billion in awards issued in 2004. Those two are the Air Force's $9 billion Network Centric Solutions program and the Army's $7 billion Warfighter Information Network-Tactical System.

The professional services area, which includes such categories as project management, software development, training, and modeling and simulation, more than doubled from $49 billion in 2003 to $108.3 billion in fiscal 2004.

Research and development accounted for $10.4 billion in federal prime contracts, up from $5.5 billion last year.

Homeland Security entered Input's top five in fiscal 2004, driven by the $10 billion U.S. Visitor and Immigration Status Indication Technology system award.