After a period of growth that peaked in fiscal 2010, budgets for the National Intelligence Program and Military Intelligence Programs have contracted in recent years. Falling from a total of $80.1 B in fiscal 2010, budget level reached an estimated $66.0 B in fiscal 2015.
Deltek’s Federal Intelligence Community IT Market, 2015–2020 report projects contractor addressable intelligence IT spending to contract from $9.8 billion in FY 2015 to $9.5 billion in FY 2020, reflecting a -0.4% Compound Annual Growth Rate (CAGR).
Similar to other federal government entities, intelligence organizations are looking to drive greater efficiency and effectiveness through technology by streamlining infrastructure, updating operational models, and reducing duplicative spending. Realities of declining budgets have challenged agencies to meet ongoing mission requirements while implementing new technology solutions. Shifting toward a shared, joint IT infrastructure and architecture is anticipated to improve data sharing, increase security, and achieve economies of scale; yet, progress varies across intelligence agencies. The transition to an “as a Service” environment promises to deliver cost savings, more rapid access to information, and greater ease in sharing in data and applications within the intelligence community. Nonetheless, entrenched attitudes and the sensitive nature of much of the data continue to be hurdles for cloud adoption. While overall spending for IT spending is expected to remain flat over the forecast period, demands related to cybersecurity, cloud, big data analytics, and infrastructure modernization will encourage growth opportunities.
Deltek’s analysis of the intelligence community technology market includes capturing available spending from intelligence organizations that report obligations. Indeed, while some prime contracts funded by military intelligence units are reported in the Federal Procurement Database – Next Generation (FPDS-NG), many of the agencies do not report spending data. Due to the sensitive and classified nature of much of the military intelligence activities, Deltek was unable to confirm what portion of the total spend on technology prime contracting was identified for agencies that do report to FPDS-NG. Of the obligations that are reported, it remains unclear whether these contracts are funded through the Military Intelligence Program. Analysis of the reported spending data sheds some light on spending habits, however, and offers insights into trends across the technology segments as well as the competitive landscape.
For a strategic 5-year view of the market and a more in depth analysis of factors shaping intelligence community procurement of IT goods and services visit GovWin.com.