I worked on the NMCI project at NOB for awhile when it was in its infancy. SlimHazy and I were just talking two weeks ago about how badly he hates having to use it at his work. Looks like he's in for a few more years.
wireservice.wired.com/wired/story.asp?section=Breaking&storyId=1178824PLANO, Texas (AP) -- The Navy said Friday it has extended by three years a multi-billion-dollar contract under which Electronic Data Systems Corp. is building a communications network for the Navy and Marine Corps.
The extension, through September 2010, will add an estimated $3.1 billion to the contract, which was previously worth about $8.8 billion in revenue.
The Navy also agreed to pay EDS $100 million to settle the company's complaints against the service, while EDS agreed to a 15 percent discount on work stations. Other terms of the contract, including the buyback value of equipment being used by the Navy, were also changed.
EDS officials have been negotiating for a contract extension for several months. Work on the contract was more complicated than EDS first believed, and the contract was a cash drain on the company for several years.
Delores M. Etter, assistant Navy secretary for research and development, said it was best for the Navy to exercise the option early. The contract, known as NMCI, wasn't due to expire for 18 months.
"NMCI has become a vital part of our day-to-day naval operations, and I felt it critically important that we not lose connectivity for our users, particularly at a critical time in the global war on terrorism," she said.
EDS Chairman and Chief Executive Michael Jordan called the extension a significant achievement for his company.
The network covers 290,000 work stations at more than 1,000 sites. EDS said the network stopped 20 million unauthorized access attempts and eliminated 70,000 computer viruses last year.
The Navy contract, EDS' largest government deal, was seen as a coup when it was awarded in 2000 at an original value of $6.9 billion in revenue. However, EDS soon found that revenue was outstripped by costs, as the company struggled to transform the Navy's aging computer programs into a faster and more secure network. Along the way, Congress also imposed tougher testing requirements on the system.
Before the announcement, shares of Plano-based EDS rose 8 cents, to close at $27.56 Friday on the New York Stock Exchange.