TSA Awards $43.6M for Microsoft Licenses and Support to Dell Federal
Contract Overview
Contract Amount: $43,614,120 ($43.6M)
Contractor: Dell Federal Systems L.P
Awarding Agency: Department of Homeland Security
Start Date: 2021-03-27
End Date: 2023-03-26
Contract Duration: 729 days
Daily Burn Rate: $59.8K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: AWARD OF BPA CALL FOR THE CONTINUED USE OF MICROSOFT-BRANDED PERPETUAL LICENSES AND SOFTWARE SUPPORT FOR THE TSA ENTERPRISE.
Place of Performance
Location: ROUND ROCK, WILLIAMSON County, TEXAS, 78682
State: Texas Government Spending
Plain-Language Summary
Department of Homeland Security obligated $43.6 million to DELL FEDERAL SYSTEMS L.P for work described as: AWARD OF BPA CALL FOR THE CONTINUED USE OF MICROSOFT-BRANDED PERPETUAL LICENSES AND SOFTWARE SUPPORT FOR THE TSA ENTERPRISE. Key points: 1. Significant award for enterprise software and support, indicating reliance on Microsoft ecosystem. 2. Competition was full and open, suggesting a potentially competitive pricing environment. 3. Risk of vendor lock-in and potential for cost escalation with perpetual licenses. 4. IT services sector, with a focus on software licensing and maintenance.
Value Assessment
Rating: fair
The award amount of $43.6M over two years for perpetual licenses and support appears substantial. Benchmarking against similar enterprise software agreements would be necessary to determine if this represents fair value, especially considering potential volume discounts or alternative licensing models.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which is positive for price discovery. However, the specific nature of Microsoft perpetual licenses might limit the practical scope of competition among vendors offering alternative solutions.
Taxpayer Impact: Taxpayer funds are being used for essential software licensing and support. The competitive award process aims to ensure reasonable pricing, but the long-term cost of perpetual licenses versus subscription models warrants scrutiny.
Public Impact
Ensures continued operation of critical TSA systems relying on Microsoft software. Supports federal IT infrastructure with necessary software and maintenance services. Potential for future contract modifications or renewals impacting long-term costs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Reliance on perpetual licenses may lead to higher long-term costs compared to subscription models.
- Potential for vendor lock-in with a specific software provider.
- Need for ongoing monitoring of software usage and support needs to ensure cost-effectiveness.
Positive Signals
- Awarded under full and open competition.
- Supports critical government operations.
- Firm fixed-price contract provides cost certainty.
Sector Analysis
This award falls within the IT services sector, specifically focusing on software licensing and maintenance. Government spending on enterprise software licenses and support is a significant category, often characterized by long-term contracts and the need for specialized vendor relationships.
Small Business Impact
The awardee is Dell Federal Systems L.P., a large business. There is no indication in the provided data that small businesses were involved as subcontractors or partners in this specific award.
Oversight & Accountability
The award was made under a BPA Call, suggesting it is part of a larger Indefinite Delivery/Indefinite Quantity (IDIQ) contract. Oversight would involve monitoring performance, adherence to contract terms, and ensuring continued justification for the software and support.
Related Government Programs
- Other Computer Related Services
- Department of Homeland Security Contracting
- Transportation Security Administration Programs
Risk Flags
- Potential for higher long-term costs with perpetual licenses.
- Risk of vendor lock-in.
- Need for ongoing cost-benefit analysis against subscription models.
- Dependence on specific software versions without guaranteed upgrades.
Tags
other-computer-related-services, department-of-homeland-security, tx, bpa-call, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $43.6 million to DELL FEDERAL SYSTEMS L.P. AWARD OF BPA CALL FOR THE CONTINUED USE OF MICROSOFT-BRANDED PERPETUAL LICENSES AND SOFTWARE SUPPORT FOR THE TSA ENTERPRISE.
Who is the contractor on this award?
The obligated recipient is DELL FEDERAL SYSTEMS L.P.
Which agency awarded this contract?
Awarding agency: Department of Homeland Security (Transportation Security Administration).
What is the total obligated amount?
The obligated amount is $43.6 million.
What is the period of performance?
Start: 2021-03-27. End: 2023-03-26.
What is the total cost of ownership for these perpetual licenses over their expected lifespan, including potential upgrade costs and support renewals, compared to a subscription-based model?
Assessing the total cost of ownership requires projecting future support renewals and potential upgrade paths for the perpetual licenses. Comparing this to the predictable annual costs of a subscription model, factoring in potential price increases for both, is crucial. Without this analysis, it's difficult to definitively state if perpetual licenses offer better long-term value, especially given the rapid evolution of software.
How does the government ensure it is not overpaying for Microsoft software and support, given the vendor's market dominance and the nature of perpetual licenses?
The initial award under full and open competition provides a baseline for price discovery. However, ongoing vigilance is needed. This includes regular market research to identify competitive alternatives, negotiating favorable terms for support renewals, and ensuring that the quantity of licenses procured accurately reflects actual usage to avoid paying for unused software. Periodic re-evaluation of the licensing strategy is also key.
What is the strategy for managing software obsolescence and ensuring the TSA has access to modern functionalities if these perpetual licenses do not include future version upgrades?
The strategy for managing software obsolescence depends heavily on the specific terms of the perpetual license agreement. If future version upgrades are not included, the TSA may need to procure them separately or plan for a future migration to newer software versions or different licensing models. This requires proactive IT asset management and strategic planning to align software capabilities with evolving mission requirements.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
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, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $68,932,608
Exercised Options: $44,005,115
Current Obligation: $43,614,120
Actual Outlays: $1,824,763
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Parent Contract
Parent Award PIID: 70RTAC21A00000001
IDV Type: BPA
Timeline
Start Date: 2021-03-27
Current End Date: 2023-03-26
Potential End Date: 2024-03-26 12:00:00
Last Modified: 2025-05-15
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