SEC Renews Palo Alto NGFW Licensing for $19.98M, Extending Support Through 2026

Contract Overview

Contract Amount: $19,978,130 ($20.0M)

Contractor: FCN, Inc.

Awarding Agency: Securities and Exchange Commission

Start Date: 2022-09-26

End Date: 2026-09-25

Contract Duration: 1,460 days

Daily Burn Rate: $13.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: NEXT GENERATION FIREWALL (NGFW) LICENSING, MAINTENANCE, AND SUPPORT RENEWAL OF PALO ALTO PRODUCTS.

Place of Performance

Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20852

State: Maryland Government Spending

Plain-Language Summary

Securities and Exchange Commission obligated $20.0 million to FCN, INC. for work described as: NEXT GENERATION FIREWALL (NGFW) LICENSING, MAINTENANCE, AND SUPPORT RENEWAL OF PALO ALTO PRODUCTS. Key points: 1. Contract value of $19.98M for Next Generation Firewall (NGFW) licensing and support. 2. Competition was full and open after exclusion of sources, indicating a competitive process. 3. Risk is moderate, tied to reliance on a single vendor's technology for critical security. 4. Sector is IT, specifically cybersecurity infrastructure and maintenance.

Value Assessment

Rating: good

The contract value of $19.98M for a 4-year term appears reasonable for enterprise-grade firewall licensing and support. Benchmarking against similar multi-year renewals for Palo Alto Networks products would provide a more precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition after exclusion of sources. This method suggests that while specific sources might have been initially excluded, the final award was based on a competitive process, likely leading to fair price discovery.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure necessary cybersecurity infrastructure at a reasonable cost.

Public Impact

Ensures continued protection of sensitive SEC data and systems through advanced firewall technology. Supports the agency's mission by maintaining robust cybersecurity defenses against evolving threats. Provides access to critical software updates, patches, and technical support for Palo Alto Networks hardware.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Vendor lock-in risk with Palo Alto Networks products.
Potential for price increases in future renewals.
Dependence on a single vendor for critical security infrastructure.

Positive Signals

Maintains essential cybersecurity capabilities.
Awarded through a competitive process.
Long-term support ensures system stability.

Sector Analysis

This contract falls within the IT sector, specifically focusing on cybersecurity hardware and software maintenance. Spending benchmarks for similar government cybersecurity renewals vary widely based on agency size and specific product needs, but this value is within a typical range for enterprise-level solutions.

Small Business Impact

The data does not indicate specific participation or subcontracting by small businesses in this particular contract. Further analysis would be needed to determine the extent of small business involvement.

Oversight & Accountability

The Securities and Exchange Commission (SEC) is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms should be in place to ensure proper execution and accountability.

Related Government Programs

Other Computer Related Services
Securities and Exchange Commission Contracting
Securities and Exchange Commission Programs

Risk Flags

Vendor Lock-in
Reliance on a Single Technology Provider
Potential for Escalating Costs in Future Renewals
Cybersecurity Threat Landscape Evolution

Frequently Asked Questions

What is this federal contract paying for?

Securities and Exchange Commission awarded $20.0 million to FCN, INC.. NEXT GENERATION FIREWALL (NGFW) LICENSING, MAINTENANCE, AND SUPPORT RENEWAL OF PALO ALTO PRODUCTS.

Who is the contractor on this award?

The obligated recipient is FCN, INC..

Which agency awarded this contract?

Awarding agency: Securities and Exchange Commission (Securities and Exchange Commission).

What is the total obligated amount?

The obligated amount is $20.0 million.

What is the period of performance?

Start: 2022-09-26. End: 2026-09-25.

What is the total cost of ownership for this NGFW solution over its lifecycle, including hardware, software, and support?

The current contract covers licensing, maintenance, and support for approximately four years at $19.98 million. To determine the total cost of ownership, one would need to factor in the initial hardware acquisition costs (if not already sunk), potential future upgrade costs, and the cost of any associated training or personnel required to manage the solution effectively.

How does the per-unit cost of these NGFW licenses compare to similar government or commercial procurements?

Without specific unit counts or detailed product configurations, a direct per-unit cost comparison is challenging. However, the overall contract value of $19.98M over roughly four years suggests a significant investment. Benchmarking against GSA schedules or other agency contracts for comparable Palo Alto Networks models and support tiers would be necessary for a robust comparison.

What measures are in place to ensure the SEC is receiving competitive pricing for this sole-source-like renewal, given the exclusion of other sources?

Although described as 'full and open competition after exclusion of sources,' the renewal of specific vendor products often leans towards sole-source dynamics. The agency should have conducted a thorough market research analysis to justify the exclusion of other sources and ensure the pricing reflects fair market value, potentially through comparison with previous contracts or industry benchmarks.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 50310222Q0132

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2600 TOWER OAKS BLVD STE 575, ROCKVILLE, MD, 20852

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $23,210,877

Exercised Options: $19,978,130

Current Obligation: $19,978,130

Actual Outlays: $19,706,253

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: NNG15SC71B

IDV Type: GWAC

Timeline