The U.S. Army plans to spend up to $200 million on iRobot products over the next five years, iRobot announced Tuesday.
The contract iRobot previously had with the U.S. Army Program Executive Office for Simulation, Training, and Instrumentation expired in May 2008 and was limited to the purchase of PackBots.
The new contract gives the U.S. Army the freedom to purchase parts, training, and maintenance services from iRobot, as well as any robots from the company's industrial or consumer lines over the next five years, according to iRobot.
However, the $200 million five-year contract that was awarded is a "ceiling priced Indefinite-Delivery/Indefinite-Quantity (IDIQ) contract," iRobot said in a statement.
That means the U.S. Army may or may not spend the full $200 million in products promised.
IDIQ contracts are common between vendors and U.S. government agencies because they are flexible and unrestricted.
According to Federal Acquisition Regulation on IDIQ contracts, the U.S. government does not have to spend the full dollar amount to fulfill its contractual obligations with the vendor. It also allows the government to use the money designated for that vendor on any products and services as needed over a designated period of time, rather than restrict it to purchasing a specific list and quantity of items.
While vendors are not guaranteed that the full contract amount will be realized, it does give them the opportunity to offeras they become available. Whether or not this type of flexibility is advantageous to vendors is up for debate.
It's clear why the U.S. Army would want the option to purchase parts and maintenance from iRobot. About 1,700 PackBots have now been sold to the U.S. military, according to iRobot's latest figures. The Department of Defense has ordered that the older models be kept in use in some capacity if possible. A few weeks ago, the U.S. Army announced it had found a way to.
iRobot also announced in June that it won a contract with the Defense Advanced Research Projects Agency (DARPA) and the U.S. Army Research Office to develop a "ChemBot." The new type of robot will beand be able to squeeze into tight spaces.