Commerce Dept Awards $20M for WCOSS Supercomputers to IBM, Lacking Competition
Contract Overview
Contract Amount: $20,039,945 ($20.0M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of Commerce
Start Date: 2011-08-31
End Date: 2012-09-30
Contract Duration: 396 days
Daily Burn Rate: $50.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: PRIMARY AND BACKUP WCOSS SUPERCOMPUTERS AND ASSOCIATED SUPPORT SERVICES. PLACES OF PERFORMANCE ARE CAMP SPRINGS, MD, GAITHERSBURG, MD, AND FAIRMONT, WV.
Place of Performance
Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817
State: Maryland Government Spending
Plain-Language Summary
Department of Commerce obligated $20.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: PRIMARY AND BACKUP WCOSS SUPERCOMPUTERS AND ASSOCIATED SUPPORT SERVICES. PLACES OF PERFORMANCE ARE CAMP SPRINGS, MD, GAITHERSBURG, MD, AND FAIRMONT, WV. Key points: 1. IBM secured a $20M contract for supercomputer support services. 2. The contract was not competed, raising questions about price discovery. 3. Services are for the National Oceanic and Atmospheric Administration (NOAA). 4. The contract value is $20,039,945. 5. Performance locations include Maryland and West Virginia.
Value Assessment
Rating: questionable
The contract value of $20,039,945 for supercomputer support services is difficult to assess without a competitive benchmark. Given the lack of competition, it's unclear if this price represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded as 'NOT COMPETED,' indicating a sole-source or limited competition procurement. This approach bypasses the standard competitive bidding process, potentially leading to higher prices and reduced innovation.
Taxpayer Impact: The lack of competition may result in taxpayers paying more than necessary for these critical supercomputing services.
Public Impact
Essential weather and climate supercomputing capabilities for NOAA are maintained. IBM continues to be a key provider for critical government IT infrastructure. The absence of competition could impact the long-term cost-effectiveness of these services. Procurement decisions may warrant closer scrutiny to ensure taxpayer value.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpayment
- Sole-source award
Positive Signals
- Ensures continuity of critical weather services
- Leverages established provider (IBM)
Sector Analysis
The IT sector, particularly high-performance computing, requires significant investment. Benchmarks for supercomputer support services can vary widely based on complexity and scale, making direct comparisons challenging without competitive data.
Small Business Impact
This contract was awarded to IBM, a large business. There is no indication that small businesses were involved in this specific procurement, either as prime contractors or subcontractors.
Oversight & Accountability
The 'NOT COMPETED' status suggests limited initial oversight on the procurement strategy. Further oversight would be needed to ensure the justification for sole-source was valid and that ongoing performance and pricing are reasonable.
Related Government Programs
- Computer Systems Design Services
- Department of Commerce Contracting
- National Oceanic and Atmospheric Administration Programs
Risk Flags
- Sole-source award
- Lack of price competition
- Potential for inflated costs
- Limited transparency on justification
Tags
computer-systems-design-services, department-of-commerce, md, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Commerce awarded $20.0 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. PRIMARY AND BACKUP WCOSS SUPERCOMPUTERS AND ASSOCIATED SUPPORT SERVICES. PLACES OF PERFORMANCE ARE CAMP SPRINGS, MD, GAITHERSBURG, MD, AND FAIRMONT, WV.
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).
What is the total obligated amount?
The obligated amount is $20.0 million.
What is the period of performance?
Start: 2011-08-31. End: 2012-09-30.
What was the justification for awarding this contract on a sole-source basis?
The provided data indicates the contract was 'NOT COMPETED.' A full justification would typically detail why competition was not feasible, such as unique capabilities, urgent need, or lack of market availability. Without this justification, it's difficult to assess the necessity of bypassing competitive procedures.
How does the $20M price compare to similar supercomputer support contracts awarded competitively?
Direct comparison is challenging due to the sole-source nature of this award. Generally, non-competed contracts risk being higher than competitively bid ones. A thorough analysis would require access to pricing data from similar, competed contracts for comparable supercomputing services.
What is the long-term risk to NOAA's operational effectiveness if IBM's services are not cost-effective?
The primary risk is that budget constraints could be exacerbated if costs are inflated due to lack of competition. This could potentially limit future investments in upgrades or other critical IT infrastructure, indirectly impacting NOAA's ability to maintain and enhance its weather and climate modeling capabilities.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 08
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $21,349,263
Exercised Options: $20,039,945
Current Obligation: $20,039,945
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $2,247,890
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2011-08-31
Current End Date: 2012-09-30
Potential End Date: 2013-09-30 00:00:00
Last Modified: 2013-07-31
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