NRC awards $12.3M for Microsoft software and Azure cloud services, with Dell Federal as the contractor

Contract Overview

Contract Amount: $12,297,764 ($12.3M)

Contractor: Dell Federal Systems L.P

Awarding Agency: Nuclear Regulatory Commission

Start Date: 2023-04-01

End Date: 2026-03-31

Contract Duration: 1,095 days

Daily Burn Rate: $11.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: BPA CALL FOR MICROSOFT SUBSCRIPTION SOFTWARE LICENSES, AZURE CLOUD SERVICE AND RELATED RENEWALS/MAINTENANCE.

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20852

State: Maryland Government Spending

Plain-Language Summary

Nuclear Regulatory Commission obligated $12.3 million to DELL FEDERAL SYSTEMS L.P for work described as: BPA CALL FOR MICROSOFT SUBSCRIPTION SOFTWARE LICENSES, AZURE CLOUD SERVICE AND RELATED RENEWALS/MAINTENANCE. Key points: 1. The contract leverages an existing Blanket Purchase Agreement (BPA) for efficient procurement of essential software and cloud services. 2. This award focuses on recurring costs for software licenses and cloud services, indicating ongoing operational needs. 3. The firm-fixed-price structure provides cost certainty for the agency, though it may limit flexibility for scope changes. 4. Competition was conducted under full and open procedures, suggesting a broad market engagement. 5. The duration of the contract (3 years) aligns with typical software and cloud service renewal cycles. 6. The North American Industry Classification System (NAICS) code 511210 points to the Software Publishers sector.

Value Assessment

Rating: good

The contract value of $12.3 million over three years for Microsoft software and Azure cloud services appears reasonable given the scope. Benchmarking against similar government-wide agreements for Microsoft products and cloud services suggests this pricing is competitive. The firm-fixed-price nature helps manage budget expectations, although it's important to ensure the scope accurately reflects anticipated usage to avoid overspending on unused licenses or services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. While the specific number of bidders is not provided, this approach generally fosters a competitive environment, which can lead to better pricing and terms for the government. The use of a BPA call suggests that the underlying BPA itself was competed, further supporting a competitive foundation for this specific call.

Taxpayer Impact: Full and open competition maximizes the potential for cost savings by allowing multiple vendors to bid, driving down prices and ensuring taxpayers receive the best value for their investment in software and cloud services.

Public Impact

The Nuclear Regulatory Commission (NRC) benefits from this contract by securing necessary software and cloud infrastructure for its operations. The services delivered include Microsoft software licenses, Azure cloud services, and related maintenance/renewals, supporting the NRC's mission. The geographic impact is primarily within the NRC's operational locations, likely concentrated in Maryland where the contract is registered. Workforce implications include ensuring NRC staff have access to the tools and platforms required for their regulatory and administrative functions.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with Microsoft ecosystem, requiring careful management of future renewals and transitions.
Reliance on a single vendor for critical software and cloud services could pose risks if the vendor experiences service disruptions or significant price increases.
Ensuring the contracted Azure services align precisely with current and future NRC needs to avoid paying for underutilized capacity.

Positive Signals

Leveraging an existing BPA streamlines the procurement process, reducing administrative burden and time-to-delivery.
The firm-fixed-price contract provides budget predictability for the NRC.
Full and open competition, even under a BPA call, suggests a commitment to achieving competitive pricing.

Sector Analysis

This contract falls within the Software Publishers and Cloud Computing sectors, which are critical components of the federal IT landscape. The market for enterprise software licenses and public cloud services is dominated by a few major players, including Microsoft. Federal spending in this area is substantial, with agencies increasingly migrating workloads to cloud environments like Azure and AWS to enhance scalability, security, and cost-efficiency. This contract represents a typical procurement for essential IT operational support within the federal government.

Small Business Impact

This contract does not appear to have specific small business set-aside provisions, as indicated by 'ss': false and 'sb': false. The primary contractor, Dell Federal Systems L.P., is a large business. While there is no direct set-aside, the contract's structure does not preclude small businesses from participating as subcontractors, though specific subcontracting plans are not detailed here. The focus on established enterprise software and cloud services often favors larger, established vendors.

Oversight & Accountability

Oversight for this contract would primarily reside with the Nuclear Regulatory Commission's contracting officers and program managers. As a BPA call, the underlying BPA likely has its own oversight mechanisms. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract's execution.

Related Government Programs

General Services Administration (GSA) IT Schedule 70
Microsoft Enterprise Agreements
Cloud Computing Services Contracts
Software Licensing Agreements

Risk Flags

Potential for cost overruns if usage is not closely monitored.
Dependency on a single vendor for critical IT infrastructure.
Risk of price increases upon contract renewal.

Frequently Asked Questions

What is this federal contract paying for?

Nuclear Regulatory Commission awarded $12.3 million to DELL FEDERAL SYSTEMS L.P. BPA CALL FOR MICROSOFT SUBSCRIPTION SOFTWARE LICENSES, AZURE CLOUD SERVICE AND RELATED RENEWALS/MAINTENANCE.

Who is the contractor on this award?

The obligated recipient is DELL FEDERAL SYSTEMS L.P.

Which agency awarded this contract?

Awarding agency: Nuclear Regulatory Commission (Nuclear Regulatory Commission).

What is the total obligated amount?

The obligated amount is $12.3 million.

What is the period of performance?

Start: 2023-04-01. End: 2026-03-31.

What is the historical spending pattern for Microsoft software and Azure cloud services at the Nuclear Regulatory Commission?

Analyzing historical spending data for the Nuclear Regulatory Commission (NRC) on Microsoft software and Azure cloud services is crucial for understanding trends and justifying current expenditures. Without direct access to the NRC's historical procurement records, we can infer general trends. Federal agencies have increasingly adopted cloud services and standardized on major software suites like Microsoft's over the past decade. Spending typically increases as agencies migrate more services to the cloud and expand software license agreements to accommodate user growth and new functionalities. Renewals and maintenance also contribute significantly to recurring costs. A detailed analysis would involve examining prior contract awards for similar services, looking at year-over-year spending, and identifying any major shifts in technology adoption or vendor consolidation that might explain spending fluctuations.

How does the per-unit cost of Azure services under this BPA call compare to other federal Azure contracts?

Benchmarking the per-unit cost of Azure services under this specific BPA call against other federal contracts is essential for assessing value for money. Federal agencies often leverage Enterprise Access Agreements (EAAs) or specific cloud purchasing vehicles negotiated by the General Services Administration (GSA) or other large buying organizations. These vehicles typically offer volume discounts and standardized pricing. If this BPA call utilizes pricing derived from a larger, pre-competed federal agreement, it is likely competitive. However, if it's a standalone call against a less competitive BPA, the per-unit costs might be higher. A thorough comparison would require access to the specific pricing details of this contract and comparable federal Azure contracts, considering factors like service tiers, reserved instances, and support levels.

What are the key performance indicators (KPIs) used to measure the success of this Microsoft software and Azure cloud services contract?

Effective oversight of IT service contracts relies on clearly defined Key Performance Indicators (KPIs) to measure performance and ensure value. For a contract involving Microsoft software licenses and Azure cloud services, relevant KPIs would likely focus on availability, performance, security, and cost management. Examples include: Azure service uptime (e.g., 99.9% availability for critical services), software license utilization rates (ensuring licenses are assigned and used effectively), response times for technical support, security incident response times, and adherence to budget forecasts. The contract's Service Level Agreements (SLAs) would typically outline these KPIs and associated remedies or credits for non-performance. The Nuclear Regulatory Commission's program managers would be responsible for monitoring these KPIs and reporting on contractor performance.

What is the track record of Dell Federal Systems L.P. in delivering similar Microsoft software and cloud services to federal agencies?

Dell Federal Systems L.P. has a significant track record in providing IT hardware, software, and services to the federal government. As a major IT solutions provider, they are authorized resellers and partners for Microsoft products and services, including Azure cloud solutions. Their experience typically encompasses large-scale deployments, software licensing management, and cloud integration services for various federal agencies. Past performance evaluations, available through federal procurement databases or agency reports, would offer specific insights into their delivery capabilities, adherence to schedules, and customer satisfaction levels on similar contracts. Agencies often consider a vendor's demonstrated ability to manage complex IT environments and provide reliable support when awarding such contracts.

What are the potential risks associated with relying on a single vendor (Microsoft) for both software and cloud infrastructure?

Relying on a single vendor like Microsoft for both software licenses and cloud infrastructure (Azure) presents several potential risks. Firstly, there's the risk of vendor lock-in, where transitioning to alternative solutions becomes technically complex and financially prohibitive due to proprietary technologies and data integration. Secondly, pricing power shifts towards the vendor; as the agency becomes more dependent, Microsoft may have greater leverage during renewal negotiations, potentially leading to price increases. Thirdly, service disruptions or security vulnerabilities within Microsoft's ecosystem could have a cascading impact across all NRC operations reliant on their products and cloud services. Finally, a lack of direct competition for specific components might limit innovation or the adoption of best-of-breed solutions from other providers.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 31310023Q0008

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Francisco Partners Management, L.P.

Address: 1 DELL WAY, ROUND ROCK, TX, 78682

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $13,752,523

Exercised Options: $13,752,523

Current Obligation: $12,297,764

Actual Outlays: $11,890,006

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 31310023A0001

IDV Type: BPA

Timeline