Navy to finish moving IT network to NGEN contract by September

Following a long series of delays, the Navy says it intends to fully migrate its massive enterprise IT network onto a new contract structure known as NGEN by the end of September.

The Navy originally had hoped to transition its one million user Navy-Marine Corps Intranet (NMCI) to the Next Generation Enterprise Network (NGEN) contract by this month. But retaking control over what had been the largest outsourced government IT program in history turned out to be a more complicated task than the service hoped.

The Navy delayed its initial request for proposals by several months, as was the final award of the NGEN contract. Then, late last year, all work had to stop for another four months until a protest of the $3.5 billion award was resolved.

Now, the Navy and its prime contractor, HP, are racing to move NMCI to NGEN’s government-owned, contractor-supported model by the end of this fiscal year. That will mean shaving about three months off of the contract’s original transition schedule.

Capt. Michael Abreu, the NGEN program manager, said he thinks that’s achievable.


“There are two key enablers to that: One is that the incumbent won the competition, and we had built the RFP based on a non-incumbent winning,” he said. “So when we were able to talk to HP once the protest was lifted, we immediately started asking them what they could to do accelerate the transition internally. They did that. The other piece was an awful lot of hard work and planning since we started in November. We’ve had to work constantly as a team to plan how we’re going to execute this transition on an earlier timeline.”

10th Fleet has high level control

The Marine Corps finished its transition from the contractor-owned-and-operated model last summer. It now owns and operates its network itself after having purchased its portion of the network assets from HP in one lump sum.

The Navy’s successor to the original NMCI contract will be different. The service is buying back network infrastructure and intellectual property from HP via an ongoing payment plan, and the 10th Fleet — the Navy’s cyber command — will have high-level control over how the network is run. But HP still will handle most of the daily touch-labor required to keep things running.

While the prime vendor hasn’t changed, Abreu said the Navy now estimates the NGEN arrangement will save the service about $1 billion over the next five years, so it is anxious to avoid any further delays.

“The price reduction we got was a result of the completion we just went through,” he said. “The price differential is about $20 million a month, so that’s my incentive to move our network from our old contract to the new contract as quickly as I can. I want to do that efficiently though, and without introducing risk to the fleet.”

The Navy doesn’t want its users to get the idea that their IT experience will change, for better or worse, once the NGEN transition is finished — at least not right away. NMCI still will be NMCI, just under a different management structure that will, it hopes, be transparent to users.

But that doesn’t mean the transition will be a simple affair behind the scenes. Abreu said the Navy is taking several significant steps to make the change, two of which it completed last week when it crossed the finish line on significant bureaucratic mileposts, passing both its critical design review and contractor-readiness review.

“One of those reviews was on internal government readiness since we’ve increased our internal command and control responsibilities, but we also needed to make sure the contractor was ready to start the actual transition,” he said. “The transition essentially is going to happen in two major phases. The first one started back in November, which was planning, and the second one is actual execution, which we’ll start in May. We’ve identified no major issues, and we’re ready and poised to start on May 1 to start the actual transition work.”

Fundamental rules changes

Officials say the transition also includes a huge amount of workforce development for the Navy’s own IT staff as they prepare to take greater control of the network, including taking over responsibility for many functions the Navy didn’t have to worry about while the entire operation was the hands of an outside vendor.

Bill Toti, HP’s vice president for its Navy and Marine Corps business, said the change is not simply a matter of making sure the Navy’s own people have solid, fundamental IT skills. Rather, he said, they need to know how to run something at the scale of NMCI, which is the biggest internal IT network on the planet.

“When you scale something up to this size, things don’t work out of the box,” he said. “We have to teach Microsoft about how their Exchange servers work when you have a million users. We have to teach Cisco about how their routers and switches work when you connect as many devices as we have. It isn’t merely a matter of trying to bring people into the government engineering space that have done this kind of thing before, because nobody has done this before. That means the Navy needs to develop skills on the government side that they didn’t even have before they outsourced the network. And that requires time.”

Toti said transitioning the ownership of the network’s IT assets from private hands to government ownership changes and complicates a lot of the fundamental rules that have governed how NMCI has been running for the past dozen years.

“It requires things like asset management to be done in accordance with law and DoD standards,” he said. “I can turn a purchase order around for a subcontract in a couple days, but the government can’t because of federal acquisition regulations. So processes have to change. If you tried to operate this by the same rules the company did when you’re operating under rules the company was not constrained by, it wouldn’t work. Things have to change. It requires a new coordinate set.”

The Navy long has been proud of the fact that it was the first military service to create a fully-integrated enterprise network.

The Pentagon now has an intense interest in setting up enterprise IT architectures that will serve the entire Defense Department. One tenet of the Joint Information Environment (JIE) is that all the military services are supposed to share certain enterprise services, such as data centers, email systems and transport services, all of which the Navy has just spent billions of dollars to buy on its own.

Abreu insisted there’s no tension between NGEN and JIE, and he thinks the Navy is ahead of the other services in moving toward a joint IT architecture. But he said moving the enterprise services the Navy now provides on its own up to the DoD-level would not be a trivial matter.

“Think of the network as a ship. To modify any type of ship takes a lot of engineering rigor to make sure that you’re touching the right thing in the right place and that it’s interoperable and you’re not disrupting the overall operating model,” he said. “We have to do the same thing. For whatever we do on the network, whether that’s switching email services or switching hardware, we have to be very careful to make sure the business case makes sense and that we do it with engineering discipline so that we don’t introduce risk to the network and the user experience itself.”

Business case analysis underway

In the early stages of JIE, DoD chief information officer Teri Takai already has told each military service to come up with a plan to move their email services to the Defense Information Systems Agency’s centralized system.

The Army already has done so, and the Air Force has migrated some of its accounts to the system.

The Navy and Marine Corps say they are working on a business case analysis to determine whether that makes sense for them. But HP’s Toti said the answer is fairly clear, given what the Navy has already invested.

“The Navy just went through years of procuring the network, and they own it now,” he said. “If they’re going to be told they can’t use what they just bought, there’s a cost associated with that. It would be like paying off a car loan, and then somebody tells you, ‘you can’t drive the car. You have to drive this leased car and you have to lease it from us.’ Can you do that? Absolutely. But what’s the point? As the Navy’s prime IT contractor, I can tell you it’s going to be much cheaper to use the infrastructure that they own rather than procuring the infrastructure in other ways.”

Nonetheless, Abreu and Toti said the NGEN contract allows the Navy the flexibility to contract for email or any three dozen other network services in an a-la-carte fashion, something it didn’t have under the longstanding legacy NMCI contract, in which HP sold the Navy virtually all of its shore-based network services in one opaque bundle.

HP still will operate the Navy’s entire network infrastructure in the early stages of NGEN. The service has always said that it wants to be to recompete pieces of the network chunk-by-chunk if it believes it can get a better price for a given service from a different vendor. But Abreu said he can’t yet predict when those smaller-scale competitions will begin.

“I have an ability now that I didn’t have before, so we have some learning to do in terms of how and why we would do that,” he said. “There is work to be done there for sure going forward.”


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