DOJ's FBI spent $19.7M on IBM mainframe hardware, software, and services via full and open competition

Contract Overview

Contract Amount: $19,738,199 ($19.7M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Justice

Start Date: 2014-09-22

End Date: 2016-11-08

Contract Duration: 778 days

Daily Burn Rate: $25.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::OTIGF::-IBM ZEC12 MAINFRAME. DETAILED SPECIFICATIONS INCLUDED IN SOW SECTION 2.0 REQUISITION IS FOR HARDWARE, SOFTWARE, AND SERVICES.

Place of Performance

Location: POCATELLO, BANNOCK County, IDAHO, 83201

State: Idaho Government Spending

Plain-Language Summary

Department of Justice obligated $19.7 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: IGF::OTIGF::-IBM ZEC12 MAINFRAME. DETAILED SPECIFICATIONS INCLUDED IN SOW SECTION 2.0 REQUISITION IS FOR HARDWARE, SOFTWARE, AND SERVICES. Key points: 1. The contract focused on essential mainframe hardware, software, and associated services, indicating a need for robust IT infrastructure. 2. IBM's established presence in mainframe technology likely influenced the selection, given the specialized nature of the equipment. 3. The firm-fixed-price structure suggests a defined scope and budget, aiming to control costs for the specified deliverables. 4. A delivery order under an existing contract implies a streamlined procurement process for established needs. 5. The duration of the contract (778 days) points to a significant, ongoing requirement for these IT resources.

Value Assessment

Rating: fair

Benchmarking this specific IBM mainframe hardware, software, and services contract is challenging without detailed SOW specifications and comparable market data. However, the $19.7 million expenditure over approximately two years for specialized mainframe systems suggests a substantial investment. The firm-fixed-price nature provides cost certainty, but the overall value depends heavily on the criticality of the systems to the FBI's operations and the efficiency of the delivered solutions compared to alternative technologies or service models.

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 number of bidders is not provided, but this approach generally fosters a competitive environment, potentially leading to better pricing and terms for the government. The FBI's decision to use full and open competition suggests they sought the best available solution and value in the market for their mainframe needs.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages a wider range of offers, driving down prices and ensuring the government receives competitive value for its spending.

Public Impact

The Federal Bureau of Investigation (FBI) is the primary beneficiary, receiving critical IT infrastructure and support. The services delivered include hardware, software, and support essential for maintaining and operating mainframe systems. The geographic impact is likely concentrated where the FBI's mainframe operations are housed, supporting national law enforcement functions. This contract supports specialized IT roles within the FBI and potentially its contractors, ensuring the continuity of essential government services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with specialized mainframe technology.
Risk of cost overruns if unforeseen technical issues arise with legacy systems.
Dependence on a single vendor (IBM) for critical hardware and software components.

Positive Signals

Firm-fixed-price contract provides budget certainty.
Full and open competition suggests a competitive bidding process.
Procurement through a delivery order may indicate an efficient process for an existing need.

Sector Analysis

This contract falls within the IT services and hardware sector, specifically focusing on mainframe computing. Mainframes are still critical for many large organizations, including government agencies, due to their power, reliability, and security for processing massive amounts of data. The market for mainframe hardware and software is dominated by a few key players like IBM. Spending in this area is often characterized by long-term investments and specialized support requirements.

Small Business Impact

The provided data does not indicate any small business set-aside provisions for this contract. As it involves specialized mainframe hardware, software, and services from a major vendor like IBM, it is unlikely that small businesses would be primary contractors, though they might participate as subcontractors. Further analysis would be needed to determine subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Justice's Office of the Inspector General (OIG), which is responsible for auditing and investigating fraud, waste, and abuse within the department. The FBI's internal procurement and contract management offices also provide oversight. Transparency is facilitated through contract databases like FPDS-NG, where basic award information is publicly available.

Related Government Programs

FBI IT Modernization Efforts
Department of Justice IT Infrastructure
Mainframe Computing Services
Legacy System Support Contracts

Risk Flags

Potential for vendor lock-in
Reliance on specialized, potentially legacy technology
High cost of mainframe maintenance and support

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $19.7 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. IGF::OTIGF::-IBM ZEC12 MAINFRAME. DETAILED SPECIFICATIONS INCLUDED IN SOW SECTION 2.0 REQUISITION IS FOR HARDWARE, SOFTWARE, AND SERVICES.

Who is the contractor on this award?

The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Bureau of Investigation).

What is the total obligated amount?

The obligated amount is $19.7 million.

What is the period of performance?

Start: 2014-09-22. End: 2016-11-08.

What is the specific nature of the IBM ZEC12 mainframe hardware and software being procured, and what are its primary functions for the FBI?

The IBM ZEC12 mainframe is a powerful enterprise server designed for high-volume transaction processing, data management, and mission-critical applications. The contract specifies "HARDWARE, SOFTWARE, AND SERVICES" related to this model, detailed in Section 2.0 of the SOW. While the exact applications are not detailed in the provided summary, mainframes like the ZEC12 are typically used by agencies like the FBI for core functions such as managing vast databases of criminal records, facilitating complex analytical tasks, supporting national security operations, and ensuring the secure and reliable processing of sensitive information. The procurement likely ensures the continued operation and support of these vital systems.

How does the $19.7 million cost compare to similar mainframe procurements by federal agencies?

Directly comparing the $19.7 million cost without specific details on the quantity of hardware, software licenses, and service levels is difficult. However, mainframe procurements, especially for established systems like the IBM ZEC12, can represent significant investments. Costs can range from millions to tens of millions of dollars depending on the scope. Factors influencing price include the number of processors, memory, storage, software licensing models (e.g., per MSU, per user), and the duration and type of support services. Given the firm-fixed-price nature and the 778-day duration, this appears to be a substantial but potentially well-defined expenditure for critical infrastructure.

What are the key risks associated with relying on IBM mainframe technology for the FBI, and how are they mitigated?

Key risks include the high cost of acquisition and maintenance, the specialized skill set required for operation and support, potential vendor lock-in with IBM's proprietary technology, and the risk of obsolescence as newer technologies emerge. Mitigation strategies often involve robust service level agreements (SLAs) with the vendor to ensure uptime and performance, investing in training for internal staff or securing specialized support contracts, and developing long-term IT roadmaps that may include phased modernization or migration plans. The firm-fixed-price contract structure helps mitigate cost uncertainty for the defined scope.

What is the historical spending pattern of the FBI on IBM mainframe systems or similar IT infrastructure?

Historical spending data for the FBI on IBM mainframe systems would require a deeper dive into contract databases over several years. However, it's common for large federal agencies with extensive data processing needs, like the FBI, to have ongoing investments in mainframe technology due to its proven reliability and capacity for handling massive workloads. Spending often occurs in cycles of hardware refreshes, software upgrades, and ongoing maintenance and support contracts. This $19.7 million delivery order suggests a continued reliance on this platform, likely building upon previous investments.

How does the 'full and open competition' for this contract ensure value for taxpayers compared to other procurement methods?

Full and open competition is generally considered the best method for ensuring taxpayer value because it maximizes the number of potential bidders, thereby increasing the likelihood of receiving competitive pricing and innovative solutions. By allowing any interested and qualified vendor to participate, the government can leverage market forces to obtain goods and services at the best possible price. This contrasts with sole-source or limited competition procurements, which may result in higher costs due to reduced market pressure. The FBI's choice indicates a commitment to achieving optimal value through a transparent and competitive process.

Industry Classification

NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores

Product/Service Code: HARDWARE AND ABRASIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 6710 ROCKLEDGE DRIVE, BETHESDA, MD, 20817

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $19,930,503

Exercised Options: $19,738,199

Current Obligation: $19,738,199

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F4984H

IDV Type: FSS

Timeline