Homeland Security ready to start ordering technology
CAMBRIDGE, Mass.-The Homeland Security Department is finally "open for business" for companies offering innovative protective systems, an industry executive said Tuesday.
Thousands of vendors have given up hope of landing federal security contracts after two years of waiting for the department to hire staff, announce programs or standards, and increase budgets, Edmond Woollen, vice president of Raytheon of Waltham, Mass., told a conference for Massachusetts companies weighing federal sales. But the window of opportunity is finally here.
Woollen said he believes Homeland Security has the quickest response of any government buyer. But he cautioned companies to be prudent and think long term in pursuit of both independent sales and collaborating with larger "system engineers" or integrators such as Lockheed Martin, Raytheon or IBM.
The department is seeking "evolutionary and revolutionary" technologies that show quantitative improvements in safety, not just change, said Charles McQueary, Homeland Security's undersecretary for science and technology.
Of the department's projected $37.6 billion budget for fiscal 2004, $900 million is earmarked for science and technology, including $198 million to prevent biological attacks, McQueary said. About 400 bidders appeared last week at the first meeting for vendors of systems for detecting chemical and biological weapons, he added.
An estimated 85 percent to 90 percent of the $900 million will be devoted to near-term solutions instead of long-term research, McQueary said, describing a two-year schedule in which suppliers move quickly from prototype to installation. Longer-range research still will be done by other defense-oriented labs or companies, but may be funded by Defense Department grants or other agencies, he said.
"We need to do things, and it's my view that if we were to have a science and technology division that was looking five or six years out, in that time we'd become irrelevant to the department," he said. "I'm looking for companies, university labs and others that have solutions today-things that are relevant to make an impact on overall homeland security."
McQueary cited the upcoming Oct. 15 release of standards for a $60 million program to protect commercial aircraft from ground attacks. He said it is more complex to equip passenger planes and meet other federal standards from the Federal Aviation Administration, for example, than supplying a contract under military specifications.
With technical standards emerging and budgets growing to fund anti-terrorism, cybersecurity and transportation infrastructure projects, companies are aggressively pursuing business in Washington.
Such contracts often are low-profit-margin sales that can take several years to materialize, said Arthur Coviello, chief executive of Bedford, Mass.-based RSA Security, which provides digital certificates and other encryption tools. But he estimates that 10 percent to 15 percent of RSA's sales are to government.
"Once you're on a contract," he said, "the repeat business and the lower costs of selling makes it a worthwhile endeavor."