As the Defense Department scrutinizes ways to cut costs, it is now putting pressure on contractors to buy their design specifications and other intellectual property.
By owning contractor data and intellectual property, the Defense Department believes it can drive down future contracting prices by opening up projects to more bidders.
Yet industry groups aren’t as excited. Many are seeking to protect contractors’ rights to maintain ownership of property they developed at their own expense, as well as identifying the limitations of owning data packages.
"The government’s becoming much more aggressive in terms of getting" technical data packages, or the set of information that would allow someone else to build the same system, said Richard Sylvester, vice president for acquisition policy at the Aerospace Industries Association. "The government is saying, ‘Well, in the long run, we want to be able to compete that.’ "
In a somewhat recent instance, Oshkosh, a military vehicle building company, beat out incumbent BAE Systems for a vehicle building company that the Army held technical data for. Now, Oshkosh says the Army wants to buy design rights for its heavy tactical vehicles and the Marine Corps wants to purchase rights for a medium tactical vehicle. If this occurs, it could hurt Oshkosh’s businesses.
"Competition for these and other DOD programs we currently have could result in future contracts being awarded to another manufacturer or the contracts being awarded to us at a lower price and operating margins than the current contracts," the company said.
In another instance, the Navy awarded contracts to Lockheed Martin and Austal USA to each build up to 10 littoral combat ships. Both contracts stated that the Navy would own the associated technical data packages that would allow “the government a wide range of viable alternatives for effective future competition," according to the Navy’s announcement.
The Professional Services Council is concerned the government is prioritizing ownership of the data over innovation, since data packages can only be used to recreate the same system.
