SEC's EDGAR II RFP finds few interested bidders

The deadline for proposals to support and upgrade the Securities and Exchange Commission computer system that provides intimate financial details on public companies came and went last month without many vendors submitting bids.

Very few companies which included incumbent BDM Federal Inc. bid on the recompete of the Electronic Data Gathering Analysis and Retrieval (EDGAR) system called EDGAR II. When awarded this spring EDGAR II is expected to be worth less than the $80 million EDGAR.

Many vendors wondered how wise and profitable it would be to chase EDGAR II because of BDM's success in developing the system. Since it was launched in the late 1980s EDGAR has proven itself a welcome source of free on-line information for investors journalists financial analysts and Wall Street money managers.

The system allows free access via the Internet to securities filings submitted electronically by publicly traded companies. The filings at least a couple of days old include items such as financial reports and reports on the sale of securities by corporate insiders. EDGAR also offers a real-time fee-based service for investors and analysts.

Indeed as public companies see record stock activity EDGAR has become so important to investors that last month the SEC had to reconfigure the system's on-line database to handle an unusually high volume of electronic filings by individuals corporations pension funds or other institutional investors that own a stake of 5 percent or more in a publicly traded company.

"In a case like EDGAR - where the incumbent is doing a good job the customer thinks very highly of them the [bid and proposal] costs are high given the response requirements [there is a] lack of real discriminators against the incumbent and an objective probability of win is less than encouraging - we would recommend our client spend the money to strengthen their sales force on vehicles already in house " said Joe Cooper president of The Federal Capture Group an information technology procurement consulting firm in Reston Va.

But the past does not matter so much SEC officials insist.

"What we've been pleased with and what we do from here on out are two different issues " said Michael E. Bartell chief information officer for the SEC. "No one has an inside track." He added that "innovative and creative" ideas are foremost in the minds of SEC officials.

Bartell explained that the SEC is interested in innovative ideas for updating and possibly privatizing EDGAR. Privatization could mean anything from outsourcing EDGAR functions to full ownership of the system Bartell said.

"We have intentionally not tried to define [privatization] " he said. "We want to see what privatization can be."

But Cooper said he would be surprised if there are even two challengers to BDM. "And if there are two they are likely to be one team that has been working it for a while and made an informed bid decision and a second team of renegades that were unsuccessful in landing a spot on the BDM team " he said.