DOJ's $58M Palantir Contract for Software Publishers Shows Long-Term Engagement

Contract Overview

Contract Amount: $57,998,387 ($58.0M)

Contractor: Palantir Technologies Inc.

Awarding Agency: Department of Justice

Start Date: 2014-09-30

End Date: 2020-03-31

Contract Duration: 2,009 days

Daily Burn Rate: $28.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20530

State: District of Columbia Government Spending

Plain-Language Summary

Department of Justice obligated $58.0 million to PALANTIR TECHNOLOGIES INC. for work described as: IGF::OT::IGF Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration of over 2000 days indicates a significant, long-term need for the services. 3. Firm Fixed Price contract type suggests predictable costs for the government. 4. The award to Palantir Technologies Inc. places this within the context of advanced data analytics and software solutions. 5. Geographic location in Washington D.C. may indicate a focus on federal agency operations. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without detailed service descriptions and performance metrics. However, the substantial award amount over a multi-year period suggests a significant investment. Comparing it to similar large-scale data analytics or software development contracts within federal agencies would be necessary for a more precise value assessment. The firm fixed-price nature provides cost certainty, but the overall value depends heavily on the effective delivery and utilization of the software and services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The number of bidders is not specified, but this method generally promotes price discovery and allows the government to select the best value. The open competition suggests that the agency sought a competitive market solution for its software needs.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing and the assurance that the chosen contractor was selected through a transparent and open process, minimizing the risk of inflated costs due to a lack of alternatives.

Public Impact

The Department of Justice benefits from advanced software solutions, likely for data analysis and operational support. Federal employees within the Offices, Boards and Divisions are likely direct users of the software and services. The contract's impact is primarily concentrated within Washington D.C., the seat of federal government operations. The workforce implications are likely related to the need for skilled personnel to manage and utilize sophisticated software platforms.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on performance metrics makes it difficult to assess the true effectiveness and return on investment.
The long duration of the contract could lead to vendor lock-in if not managed carefully.
Potential for scope creep over the contract's extended period, leading to cost overruns if not rigorously controlled.

Positive Signals

Awarded through full and open competition, suggesting a robust and fair selection process.
Firm Fixed Price contract type provides cost predictability for the agency.
The significant award amount indicates a critical need and likely high-level strategic importance for the procured services.

Sector Analysis

This contract falls within the Software Publishers (NAICS 511210) sector, which encompasses companies that publish, and/or develop and market software. The federal government is a significant consumer of software and IT services, with spending often concentrated on enterprise resource planning, data analytics, cybersecurity, and specialized mission-critical applications. Contracts of this magnitude often involve complex solutions tailored to specific agency needs, reflecting the growing reliance on technology for government operations and national security.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the procurement was likely aimed at larger, established companies capable of handling the scale and complexity of the requirement. Further analysis would be needed to determine if subcontracting opportunities were mandated or available for small businesses within the performance of this contract.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Justice's contracting officers and program managers. The Inspector General's office may also conduct audits or investigations into contract performance and financial management. Transparency is generally facilitated through contract databases like FPDS, where basic award information is publicly available, though detailed performance reports may be internal.

Related Government Programs

Software Development Services
Data Analytics Platforms
Enterprise Software Solutions
IT Services for Federal Agencies
Department of Justice IT Procurement

Risk Flags

Long contract duration may lead to technological obsolescence.
Potential for vendor lock-in with proprietary software.
Lack of specific performance metrics in award data.
No indication of small business subcontracting participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $58.0 million to PALANTIR TECHNOLOGIES INC.. IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is PALANTIR TECHNOLOGIES INC..

Which agency awarded this contract?

Awarding agency: Department of Justice (Offices, Boards and Divisions).

What is the total obligated amount?

The obligated amount is $58.0 million.

What is the period of performance?

Start: 2014-09-30. End: 2020-03-31.

What specific software or services did Palantir Technologies Inc. provide under this contract?

The provided data does not specify the exact software or services rendered by Palantir Technologies Inc. under this particular contract (Award ID: IGF::OT::IGF). However, Palantir is known for its sophisticated data analytics platforms, such as Palantir Gotham and Palantir Foundry, which are used by government agencies for intelligence analysis, defense, and law enforcement. These platforms typically involve integrating and analyzing vast amounts of data from disparate sources to identify patterns, connections, and insights. Given the 'Software Publishers' NAICS code (511210), it is highly probable that the contract covered the licensing, development, customization, and/or support of such advanced data analytics software solutions for the Department of Justice.

How does the $57.9 million award compare to other federal contracts for data analytics software?

The $57.9 million award to Palantir Technologies Inc. by the Department of Justice is a substantial sum, placing it among significant federal investments in data analytics and software solutions. Federal spending on IT, including data analytics, is in the tens of billions annually. While this specific award is large, it is not uncommon for major federal agencies to award contracts in the tens or even hundreds of millions of dollars for complex, multi-year software development and support. Benchmarking requires comparing it against contracts with similar scope, duration, and specific functionalities, which are not detailed here. However, it reflects a significant commitment by the DOJ to leverage advanced data capabilities.

What are the primary risks associated with a long-term contract like this (2014-2020)?

Long-term contracts, such as this one spanning from 2014 to 2020 (over 2000 days), carry several inherent risks. One primary risk is technological obsolescence; the software and capabilities procured may become outdated before the contract concludes, requiring costly updates or replacements. Another significant risk is vendor lock-in, where the agency becomes heavily reliant on a single provider's proprietary technology, making it difficult and expensive to switch to alternative solutions. Cost escalation is also a concern, especially if the contract includes options for expansion or if initial pricing did not fully account for future needs. Furthermore, maintaining consistent performance and ensuring the contractor remains aligned with evolving agency requirements over an extended period requires diligent oversight and contract management.

What is Palantir Technologies Inc.'s track record with federal government contracts?

Palantir Technologies Inc. has a well-established and extensive track record of securing and performing on federal government contracts, particularly within the defense, intelligence, and law enforcement communities. Beyond this Department of Justice contract, Palantir has received numerous awards from agencies such as the Department of Defense, the National Reconnaissance Office, and U.S. Immigration and Customs Enforcement (ICE). These contracts often involve providing their advanced data integration and analysis platforms to support complex operational and intelligence missions. While generally successful in terms of contract awards, Palantir's work has also drawn public scrutiny and debate regarding data privacy, ethics, and the scope of its government engagements.

How does the 'Firm Fixed Price' contract type impact cost certainty for the DOJ?

A 'Firm Fixed Price' (FFP) contract type is designed to provide the highest degree of cost certainty for the buyer, in this case, the Department of Justice. Under an FFP agreement, the contractor (Palantir Technologies Inc.) is obligated to complete the work for a predetermined, fixed price, regardless of the actual costs incurred. This shifts the risk of cost overruns from the government to the contractor. For the DOJ, this means that the $57.9 million award represents the maximum liability, assuming the contract scope does not change. This structure is beneficial for budgeting and financial planning, as it eliminates the uncertainty associated with cost-reimbursement contracts, provided the scope of work is clearly defined and managed.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

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

Address: 1530 PAGE MILL RD, PALO ALTO, CA, 94304

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

Financial Breakdown

Contract Ceiling: $60,700,000

Exercised Options: $59,500,000

Current Obligation: $57,998,387

Actual Outlays: $3,498,387

Parent Contract

Parent Award PIID: DJJ14F2508

IDV Type: BPA

Timeline