Now, as Congress considers spending millions more on the guns, this exclusive arrangement is being criticized as a bad deal for American forces and taxpayers, according to interviews and research conducted by The Associated Press.
"What we have is a fat contractor in Colt who's gotten very rich off our wars in Iraq and Afghanistan," says Sen. Tom Coburn, R-Okla.
The M4, which can shoot hundreds of bullets a minute, is a shorter and lighter version of the company's M16 rifle first used during the Vietnam War. At about $1,500 apiece, the M4 is overpriced, according to Mr. Coburn. It jams too often in sandy environments such as Iraq, he adds, and requires more maintenance than more durable carbines.
"And if you tend to have the problem at the wrong time, you're putting your life on the line," says Mr. Coburn, who began examining the M4's performance last year after receiving soldiers' complaints. "The fact is, the American GI today doesn't have the best weapon. And they ought to."
U.S. military officials disagree. They call the M4 an excellent carbine. When the time comes to replace the M4, they want a combat rifle that is leaps and bounds beyond what's available.
"There's not a weapon out there that's significantly better than the M4," says Col. Robert Radcliffe, the director of combat developments at the Army Infantry Center in Fort Benning, Ga. "To replace it with something that has essentially the same capabilities as we have today doesn't make good sense."
Colt's exclusive production agreement ends in June 2009. At that point, the Army, in its role as the military's principal buyer of firearms, might have other gunmakers compete along with Colt for continued M4 production. Or, it might begin looking for a totally new weapon.
William Keys, Colt's chief executive officer, says the M4 gets impressive reviews from the battlefield. And he worries that bashing the carbine will undermine the confidence the troops have in it.
"The guy killing the enemy with this gun loves it," says Mr. Keys, a former Marine Corps general who was awarded the Navy Cross for battlefield valor in Vietnam. "I'm not going to stand here and disparage the senator, but I think he's wrong."
In 2006, a nonprofit research group surveyed 2,600 soldiers who had served in Iraq and Afghanistan and found 89 percent were satisfied with the M4. While Colt and the Army have trumpeted that finding, detractors say the survey also revealed that 19 percent of the soldiers had their weapon jam during a firefight.
The relationship between the Army and Colt has been frosty at times. Concerned over the steadily rising cost of the M4, the Army forced Colt to lower its prices two years ago by threatening to buy rifles from another supplier. Prior to the warning, Colt "had not demonstrated any incentive to consider a price reduction," then-Maj. Gen. Jeffrey Sorenson, an Army acquisition official, wrote in a November 2006 report.
Mr. Coburn is the M4's harshest and most vocal critic, but his concern is shared by others, who point to the "SCAR," made by Belgian armorer FN Herstal, and the HK416, produced by Germany's Heckler & Koch, as possible contenders. Both weapons cost about the same as the M4, their manufacturers say.
The SCAR is being purchased by U.S. special operations forces, who have their own acquisition budget and the latitude to buy gear the other military branches can't. Or won't.
"All I know is, we're not having the competition, and the technology that is out there is not in the hands of our troops," says Jack Keane, a former Army general who pushed unsuccessfully for an M4 replacement before retiring four years ago.