Navy preps NMCI contingency plan

The Navy is honing its contingency plans should EDS be unable to carry out the service's initiative to create a single enterprisewide network across its shore-based facilities.

Both Navy and EDS officials suggested that there is no reason to believe that the information technology services giant would not be able to complete the $6.9 billion Navy Marine Corps Intranet contract. Yet Navy officials acknowledged that EDS' recent problems have tested service leaders' sea legs.

EDS has been under intense scrutiny from Wall Street investors, and several analysts have suggested that the company faces a cash crunch. That cash flow problem is, in part, because of the delays in rolling out NMCI.

"We'd rather see the IT sector more healthy," said Rear Adm. Charles Munns, NMCI's director.

The upheaval in the IT sector — including several blows to EDS — has heightened the Navy's concern. When fully implemented, EDS will own and operate a critical IT infrastructure — a single shore-based network of more than 400,000 seats at some 300 sites for the Navy and Marine Corps.

EDS officials angrily refuted any suggestion that the company was troubled. "Our financial foundation is strong," said John Clendening, a spokesman in EDS' corporate office in Plano, Texas. "We have all the resources we need to serve our existing clients and pursue new business. This is a business that generates ample cash flow from operations."

EDS officials suggested that, in any case, it would be foolish if the Navy did not have contingency plans for such mission-critical functions.

Munns emphasized that, given the state of the economy among high-tech companies, he is pleased that the Navy is working with a big company that can weather the storm.

Furthermore, even in worst-case scenarios, it is unlikely that services would be disrupted. The recent bankruptcy of WorldCom Inc. has not impacted NMCI operations, he noted. WorldCom backs up the Defense Information Systems Agency for NMCI's wide-area network.

Despite those assurances, NMCI officials have re-examined their contingency plans in the event that EDS has problems.

"We have worked on alternatives if they should be required," said Navy Vice Adm. Richard Mayo, commander of the new Naval Network Warfare Command. The command will be responsible for the NMCI network once it is fully rolled out.

Although Navy officials did not provide details of those plans, the top priority is keeping the network operational, Munns said. And the Navy has some experience running a network, because it operates the shore-based network IT-21.

Meanwhile, the rollout of seats continues. The Defense Operational Test and Evaluation division completed its assessment of NMCI, which will largely provide the data for the project's next significant milestone.

The tests were completed Oct. 4, Munns said. It will take about a month to assess those results. The review focuses on how NMCI works now that more than 30,000 seats are riding on the EDS network.