NMCI costs coming in low

The Navy's cost per seat under its Navy Marine Corps Intranet contract is nearly half of the projected cost, a senior Navy official said.

The average cost of a typical, mainstream PC under the NMCI contract, less amortized costs, is about $2,000 per seat each year, said Steven Ehrler, executive director of the Navy's Information Technology Program Executive Office. The Navy's early cost projections were about $4,000 per seat each year, he said.

NMCI is the Navy's $6.9 billion initiative to outsource its shore-based information technology infrastructure for sailors and Marines.

NMCI is the largest test of a seat management contract, Ehrler said at the e-government and e-procurement conference in Washington, D.C., Jan. 30. But when it is fully deployed, it will provide the Navy and the Marine Corps with a secure network and help the government deal with the perplexing issue of refreshing the technology that personnel use.

In fact, the NMCI Information Strike Force, the group of companies led by EDS that are spearheading NMCI, has already upgraded the basic PC for the Navy, Ehrler said. Earlier, EDS was installing PCs running at about 800 MHz, he said. Today, EDS is rolling out 1.3 GHz machines.

There also had been concerns that NMCI would put Navy personnel out of jobs. But the impact in that regard has been minimal, Ehrler said. In fiscal 2001, NMCI affected 231 positions. Of those displaced workers, 45 took posts with EDS, Ehrler said. The others decided to take other jobs elsewhere in the Navy, he said.

Those who took jobs at EDS received a three-year job guarantee, a 15 percent salary increase and a 3 percent salary bonus, Ehrler said.

As for the much-watched testing at Naval Air Facility in Washington, D.C., — NMCI's first site — Ehrler said, "testing is turning out fairly well," but he offered no further details.