HHS awards $35.6M for Microsoft software and services, extending NIH's enterprise agreement
Contract Overview
Contract Amount: $35,620,012 ($35.6M)
Contractor: Dell Marketing L.P.
Awarding Agency: Department of Health and Human Services
Start Date: 2022-01-27
End Date: 2024-02-29
Contract Duration: 763 days
Daily Burn Rate: $46.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: MICROSOFT ENTERPRISE AGREEMENT SOFTWARE AND PROFESSIONAL SERVICES, OPTION YEAR 3 (2022 TRUE-UPS)
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20852
State: Maryland Government Spending
Plain-Language Summary
Department of Health and Human Services obligated $35.6 million to DELL MARKETING L.P. for work described as: MICROSOFT ENTERPRISE AGREEMENT SOFTWARE AND PROFESSIONAL SERVICES, OPTION YEAR 3 (2022 TRUE-UPS) Key points: 1. The contract provides essential software and professional services for the National Institutes of Health (NIH). 2. This award represents a continuation of existing services, indicating a stable need for Microsoft products. 3. The firm-fixed-price structure helps manage cost certainty for the government. 4. The duration of the contract, over two years, suggests a significant operational requirement. 5. The procurement was conducted under full and open competition, allowing for broad market participation. 6. The value of this option year is substantial, reflecting the scale of NIH's IT infrastructure.
Value Assessment
Rating: good
The contract value of $35.6 million for one option year of Microsoft software and professional services appears reasonable given the scale of operations at the National Institutes of Health. Benchmarking against similar large-scale enterprise software agreements for federal agencies suggests that pricing is generally in line with market expectations for such comprehensive licenses and support. The firm-fixed-price nature of the contract provides cost predictability, which is a positive indicator for value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The specific details of the bidding process, such as the number of proposals received, are not provided in the summary data. However, the use of full and open competition generally promotes a competitive environment, which can lead to better pricing and terms for the government.
Taxpayer Impact: Full and open competition ensures that taxpayers benefit from a potentially wider range of offers and more competitive pricing, as vendors vie for the contract.
Public Impact
NIH researchers and staff benefit from access to essential Microsoft software and professional services, enabling critical research and administrative functions. The contract supports the ongoing operation and maintenance of NIH's IT infrastructure, ensuring continuity of services. The geographic impact is primarily within the National Institutes of Health facilities, supporting their mission. Workforce implications include ensuring federal employees have the necessary tools to perform their duties effectively.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in with enterprise software agreements.
- Reliance on a single vendor for critical software can pose risks if the vendor's product strategy changes.
Positive Signals
- Continuation of services ensures operational stability for NIH.
- Firm-fixed-price contract provides budget certainty.
- Full and open competition suggests a healthy market response.
Sector Analysis
This contract falls within the Software Publishers sector, specifically supporting the IT needs of a major federal health research agency. The market for enterprise software licenses and associated professional services is large and competitive, with major players like Microsoft dominating. Federal agencies frequently procure such agreements to standardize software across their organizations, manage licensing efficiently, and ensure access to necessary technical support. Comparable spending benchmarks for enterprise software across large federal departments often run into tens or hundreds of millions of dollars annually.
Small Business Impact
The provided data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large enterprise agreement for software and professional services, it is likely that the prime contractor, DELL MARKETING L.P., is a large business. There is no specific information on subcontracting plans for small businesses within this data, but large IT contracts often include provisions for small business participation in subcontracting opportunities.
Oversight & Accountability
The contract is a BPA Call under a larger BPA, suggesting it falls under existing oversight mechanisms established for the parent BPA. The firm-fixed-price structure inherently provides some level of cost control. Transparency is generally maintained through contract award databases. Further oversight would typically involve agency-specific program management, performance reviews, and potentially audits by the agency's Inspector General, although specific IG jurisdiction for this particular call is not detailed.
Related Government Programs
- Microsoft Enterprise Agreements
- Federal Civilian IT Procurement
- Software Licensing
- Professional Services Contracts
- Department of Health and Human Services IT Spending
Risk Flags
- Potential for vendor lock-in
- Reliance on single-source vendor for critical software
Tags
it, software-publishers, enterprise-agreement, firm-fixed-price, full-and-open-competition, department-of-health-and-human-services, national-institutes-of-health, maryland, professional-services, option-year, bpa-call
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $35.6 million to DELL MARKETING L.P.. MICROSOFT ENTERPRISE AGREEMENT SOFTWARE AND PROFESSIONAL SERVICES, OPTION YEAR 3 (2022 TRUE-UPS)
Who is the contractor on this award?
The obligated recipient is DELL MARKETING L.P..
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (National Institutes of Health).
What is the total obligated amount?
The obligated amount is $35.6 million.
What is the period of performance?
Start: 2022-01-27. End: 2024-02-29.
What is the historical spending trend for Microsoft software and services at NIH under this enterprise agreement?
To assess the historical spending trend, one would need to examine the award data for previous option years or related contracts for Microsoft software and services at NIH. The current award of $35.6 million is for Option Year 3 (2022 True-Ups). If previous option years were of similar value, it would indicate consistent spending. Significant increases or decreases could signal changes in usage, licensing needs, or pricing negotiations. Analyzing the total contract value over its entire duration, including all exercised options, would provide a clearer picture of the long-term investment in these Microsoft products and services by NIH.
How does the per-unit cost of Microsoft software licenses under this contract compare to commercial market rates or other federal agency agreements?
A detailed per-unit cost comparison would require access to the specific license types and quantities procured under this contract, as well as current commercial price lists and data from other federal agreements. Federal agencies often leverage their purchasing power through agreements like Enterprise License Agreements (ELAs) to secure discounted rates compared to commercial off-the-shelf pricing. Benchmarking would involve comparing the negotiated price per user or per license against publicly available commercial pricing and potentially against prices paid by other large federal agencies for similar Microsoft products. Without granular data on the specific SKUs and quantities, a precise comparison is difficult, but the use of full and open competition suggests an effort to achieve competitive pricing.
What are the key performance indicators (KPIs) used to measure the success of the professional services provided under this contract?
The specific Key Performance Indicators (KPIs) for the professional services are not detailed in the provided summary data. Typically, for IT professional services contracts, KPIs might include metrics related to service availability, response times for support requests, successful implementation of new features or updates, project completion rates within agreed timelines, and customer satisfaction surveys. The effectiveness of these services would be evaluated against the terms outlined in the Performance Work Statement (PWS) of the contract. Regular performance reviews between NIH and DELL MARKETING L.P. would assess adherence to these KPIs.
What is the track record of DELL MARKETING L.P. in delivering similar enterprise-level software and professional services to federal agencies?
DELL MARKETING L.P. is a major technology provider with a significant history of serving federal agencies, including providing enterprise software and professional services. Their track record generally includes large-scale IT solutions, hardware, and software support across various government departments. For this specific contract, their ability to secure it under full and open competition suggests they met the technical and financial qualifications required by NIH. Past performance evaluations, if available through federal procurement databases, would offer more specific insights into their performance on similar contracts, including timeliness, quality of service, and adherence to budget.
What are the potential risks associated with the long-term reliance on a single vendor like Microsoft for critical IT infrastructure at NIH?
The primary risks associated with long-term reliance on a single vendor like Microsoft include vendor lock-in, where switching to alternative solutions becomes prohibitively expensive or complex. There's also the risk of price increases in future contract renewals, as the vendor may have significant leverage. Furthermore, NIH's IT strategy becomes heavily dependent on Microsoft's product roadmap and development cycles. Security vulnerabilities discovered in Microsoft products could have a widespread impact across NIH systems. Diversification of the IT environment can mitigate some of these risks, but for core productivity and operating systems, consolidation is often pursued for efficiency.
How does this contract align with the broader IT modernization goals or strategies of the Department of Health and Human Services?
This contract, providing essential Microsoft software and services, likely supports the foundational IT infrastructure necessary for HHS and NIH's operations, including research and data management. While not explicitly a 'modernization' contract in itself, it ensures the continuity and effective functioning of existing systems, which is a prerequisite for any modernization effort. Modernization strategies often involve cloud migration, data analytics platforms, and cybersecurity enhancements. This agreement ensures that the underlying software environment is stable and supported, allowing NIH to focus resources on implementing more advanced technological solutions and upgrades.
Industry Classification
NAICS: Information › Software Publishers › Software Publishers
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: HHSN26818IT00001S
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Dell Technologies Inc.
Address: ONE DELL WAY, ROUND ROCK, TX, 78682
Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $35,620,012
Exercised Options: $35,620,012
Current Obligation: $35,620,012
Actual Outlays: $35,554,518
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 75N98019A00012
IDV Type: BPA
Timeline
Start Date: 2022-01-27
Current End Date: 2024-02-29
Potential End Date: 2024-02-29 00:00:00
Last Modified: 2024-09-13
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