DOJ's $20.5M Microsoft Software Assurance Contract with CDW Government LLC Raises Value Concerns
Contract Overview
Contract Amount: $20,485,138 ($20.5M)
Contractor: CDW Government LLC
Awarding Agency: Department of Justice
Start Date: 2010-06-15
End Date: 2011-06-29
Contract Duration: 379 days
Daily Burn Rate: $54.0K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: MICROSOFT ANNUAL SOFTWARE ASSURANCE
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20530, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Justice obligated $20.5 million to CDW GOVERNMENT LLC for work described as: MICROSOFT ANNUAL SOFTWARE ASSURANCE Key points: 1. The contract value of $20.5 million for software assurance is significant. 2. Competition was full and open, but the award mechanism (BPA) warrants scrutiny. 3. Potential risks include overpaying for software assurance and lack of ongoing value assessment. 4. The IT sector sees substantial spending on software licensing and maintenance.
Value Assessment
Rating: questionable
The $20.5 million price for annual software assurance is difficult to benchmark without specific license details. However, given the duration and the nature of software assurance, there's a risk of overpayment if not actively managed and utilized.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition via a Blanket Purchase Agreement (BPA). While this ensures broad access, BPAs can sometimes lead to less rigorous price discovery compared to direct contract awards if not managed carefully.
Taxpayer Impact: Taxpayer funds are utilized for this software assurance. The value proposition needs to be continuously assessed to ensure efficient use of these funds.
Public Impact
Government agencies rely heavily on software, making assurance contracts a recurring expense. The cost of software and its maintenance represents a significant portion of IT budgets. Ensuring competitive pricing for software assurance is crucial for fiscal responsibility.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of specific utilization metrics for software assurance.
- Potential for vendor lock-in with Microsoft products.
- BPA award mechanism may not guarantee best price.
- Contract duration could lead to price escalation.
Positive Signals
- Full and open competition was utilized.
- Firm fixed price contract type provides cost certainty.
- Awarded to a known government contractor.
Sector Analysis
This contract falls within the IT sector, specifically software licensing and maintenance. Government spending on software assurance is substantial, often representing a significant portion of agency IT budgets, with benchmarks varying widely based on software type and volume.
Small Business Impact
The award was made to CDW Government LLC, a large business. There is no indication in the provided data that small businesses were involved in this specific contract award.
Oversight & Accountability
Oversight would involve ensuring the DOJ actively utilizes the benefits of the software assurance, tracks license usage, and periodically reviews the contract for necessity and competitive pricing. The BPA mechanism requires diligent management.
Related Government Programs
- Computer and Software Stores
- Department of Justice Contracting
- Offices, Boards and Divisions Programs
Risk Flags
- High contract value.
- Potential for underutilization of assurance benefits.
- BPA award mechanism concerns.
- Lack of specific performance metrics.
- Long contract duration.
Tags
computer-and-software-stores, department-of-justice, dc, bpa, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Justice awarded $20.5 million to CDW GOVERNMENT LLC. MICROSOFT ANNUAL SOFTWARE ASSURANCE
Who is the contractor on this award?
The obligated recipient is CDW GOVERNMENT LLC.
Which agency awarded this contract?
Awarding agency: Department of Justice (Offices, Boards and Divisions).
What is the total obligated amount?
The obligated amount is $20.5 million.
What is the period of performance?
Start: 2010-06-15. End: 2011-06-29.
What is the specific value proposition of this software assurance for the DOJ?
The specific value proposition lies in guaranteed access to software updates, patches, technical support, and potentially new versions or features from Microsoft. This ensures the DOJ's systems remain secure, functional, and up-to-date, minimizing downtime and supporting operational continuity. However, the actual realized value depends on the extent to which these benefits are actively utilized and needed by the agency.
What are the primary risks associated with this contract?
The primary risks include overpaying for assurance that is not fully utilized, potential vendor lock-in limiting future flexibility, and the possibility that the firm fixed price may not reflect market changes over the contract's duration. Additionally, relying solely on a BPA without rigorous price validation could lead to suboptimal cost outcomes for taxpayers.
How effective is this contract in meeting the DOJ's software needs?
The effectiveness hinges on whether the software assurance directly supports the DOJ's mission-critical functions and provides tangible benefits like reduced security vulnerabilities and improved operational efficiency. Without detailed usage data and performance metrics, it's difficult to definitively assess effectiveness. The contract's longevity suggests it met needs, but ongoing evaluation is key.
Industry Classification
NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: CDW Corporation (UEI: 808068253)
Address: 230 N MILWAUKEE AVE, VERNON HILLS, IL, 60061
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Parent Contract
Parent Award PIID: DJJ08F1710
IDV Type: BPA
Timeline
Start Date: 2010-06-15
Current End Date: 2011-06-29
Last Modified: 2015-04-20
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