The primary purpose of Other Transactions is to attract non-traditional performers: innovative technology and research companies that usually avoid Federal Government contracts. Flexibility and creative terms, not speed or simplicity, should drive the decision to use OTs.
The U.S. technology economy has drastically changed since the mid twentieth century. The Federal Government is no longer the dominant investor in cutting-edge research and development. Private industry investment now dwarfs federal R&D spending, and commercial technology advances rapidly. Therefore, the science and technology challenges of the twenty-first century require the Federal Government to connect and collaborate with the best and brightest in private industry.
OTs are designed to meet this challenge by avoiding many of the hurdles that scare away private industry: burdensome regulations, complicated accounting rules, and extractive intellectual property terms. By their nature, OTs invite creative partnerships and collaboration between private industry and Government that is not otherwise possible with traditional Government contracting.