IBM's $32.3M contract for WCOSS O&M services awarded by Commerce, highlighting IT infrastructure support

Contract Overview

Contract Amount: $32,314,814 ($32.3M)

Contractor: International Business Machines Corporation

Awarding Agency: Department of Commerce

Start Date: 2017-02-14

End Date: 2020-02-14

Contract Duration: 1,095 days

Daily Burn Rate: $29.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF OPERATION AND MAINTENANCE SERVICES OF WCOSS

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20817

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $32.3 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: IGF::OT::IGF OPERATION AND MAINTENANCE SERVICES OF WCOSS Key points: 1. Contract value appears reasonable for a multi-year IT operations and maintenance agreement. 2. Full and open competition suggests a competitive bidding process, potentially leading to better pricing. 3. Fixed-price contract type mitigates cost overrun risks for the government. 4. Contract duration of three years provides stability for essential IT services. 5. IBM's established presence in government contracting suggests familiarity with agency needs. 6. Focus on Computer Systems Design Services indicates a critical IT infrastructure component.

Value Assessment

Rating: good

The contract value of approximately $32.3 million over three years for IT operations and maintenance services is within a typical range for large-scale government IT support. Benchmarking against similar contracts for system design and integration services suggests this pricing is competitive, especially given the full and open competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which can lead to more favorable pricing and innovative solutions for the government.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it maximizes the potential for cost savings through a robust bidding process.

Public Impact

The National Oceanic and Atmospheric Administration (NOAA) benefits from reliable operation and maintenance of its Weather and Climate Operational Supercomputing System (WCOSS). Essential IT infrastructure services are delivered, ensuring the continuity of critical weather and climate data processing. The primary geographic impact is within the United States, supporting federal agency operations. The contract supports a workforce skilled in IT operations, system administration, and supercomputing maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if transition planning is not robust at contract end.
Reliance on a single large contractor for critical IT infrastructure could pose a risk if performance degrades.

Positive Signals

IBM is a well-established contractor with extensive experience in large-scale IT projects.
The firm-fixed-price contract type provides cost certainty for the government.
Full and open competition suggests a healthy market response and potential for competitive pricing.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on computer systems design and related services. The market for IT operations and maintenance for large-scale government systems is substantial, with significant spending allocated annually to ensure the functionality of critical infrastructure. This contract represents a portion of NOAA's investment in maintaining its advanced computing capabilities.

Small Business Impact

The data indicates this contract was not set aside for small businesses and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal, though IBM may engage small businesses as subcontractors depending on their internal policies and project needs.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within NOAA. The firm-fixed-price nature of the contract provides a degree of accountability. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not always be publicly accessible.

Related Government Programs

NOAA IT Infrastructure Modernization
Federal Cloud Computing Strategy
Government IT Operations and Maintenance Contracts
Supercomputing Services Contracts

Risk Flags

Potential for vendor lock-in
Reliance on single large contractor for critical infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $32.3 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. IGF::OT::IGF OPERATION AND MAINTENANCE SERVICES OF WCOSS

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 $32.3 million.

What is the period of performance?

Start: 2017-02-14. End: 2020-02-14.

What is the track record of International Business Machines Corporation (IBM) in performing similar IT operations and maintenance contracts for federal agencies?

IBM has a long and extensive history of performing IT operations and maintenance (O&M) contracts for various federal agencies, including significant work with the Department of Defense, NASA, and other civilian agencies. Their experience spans a wide range of services, from managing complex IT infrastructure and data centers to providing software development, cybersecurity, and cloud services. For instance, IBM has held large contracts for managing agency-wide IT networks, supporting mission-critical applications, and modernizing legacy systems. Their track record generally indicates a capacity to handle large-scale, complex IT requirements, though like any large contractor, specific contract performance can vary. Agencies often evaluate past performance extensively during the procurement process to assess a contractor's reliability and capability in delivering services effectively and meeting performance standards.

How does the awarded value of $32.3 million compare to similar IT O&M contracts for supercomputing systems?

The awarded value of $32.3 million over three years for the Weather and Climate Operational Supercomputing System (WCOSS) O&M services appears to be within a reasonable range for supporting large-scale, high-performance computing infrastructure. Contracts for similar systems, such as those supporting scientific research or national security, can range from tens to hundreds of millions of dollars depending on the scope, complexity, and duration. Factors influencing cost include the number of systems managed, the criticality of uptime, the level of support required (e.g., 24/7 operations), and the specific services included, such as hardware maintenance, software patching, system administration, and performance tuning. Given that WCOSS is critical for NOAA's weather and climate modeling, a multi-million dollar annual expenditure for its maintenance is expected and aligns with industry benchmarks for comparable high-availability, high-performance computing environments.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this IT O&M contract include potential performance issues leading to system downtime, cybersecurity vulnerabilities, and cost overruns if not managed effectively. Mitigation strategies are embedded within the contract structure and agency oversight. The firm-fixed-price (FFP) contract type shifts the risk of cost overruns to the contractor, IBM, incentivizing efficient management. Performance standards and service level agreements (SLAs) are typically defined, with penalties for non-compliance. Cybersecurity risks are addressed through stringent security requirements, regular audits, and compliance with federal security mandates (e.g., NIST standards). NOAA's program management and contracting officers provide ongoing oversight, monitoring performance, reviewing deliverables, and ensuring adherence to contract terms. Regular communication and collaboration between NOAA and IBM are crucial for proactive risk identification and resolution.

What is the historical spending pattern for WCOSS operations and maintenance services by NOAA?

Analyzing historical spending for WCOSS O&M services would provide context for the $32.3 million award. While specific historical data for this exact contract is not provided in the summary, NOAA's overall IT budget and spending on supercomputing infrastructure have been substantial and generally increasing over the years due to the growing demand for climate and weather data processing. Previous contracts for WCOSS or similar systems would likely show significant annual expenditures. Trends might indicate shifts towards cloud-based solutions or increased investment in hardware upgrades. Understanding the historical trend allows for an assessment of whether current spending represents an increase, decrease, or stable investment relative to past needs and technological advancements in supercomputing.

How does the 'Computer Systems Design Services' (NAICS 541512) classification impact the scope and nature of this contract?

The NAICS code 541512, 'Computer Systems Design Services,' indicates that the contract's primary focus is on designing, developing, and integrating computer systems. For an O&M contract, this classification suggests that the services extend beyond routine maintenance to include aspects of system optimization, upgrades, configuration management, and potentially the design of future system enhancements or modifications. It implies that the contractor is responsible for ensuring the system not only runs but also evolves to meet changing operational requirements and technological advancements. This contrasts with purely 'Computer Facilities Management Services' (NAICS 541513) or 'IT Maintenance' codes, suggesting a more comprehensive, design-oriented approach to maintaining and improving the WCOSS infrastructure.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

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

Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817

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

Financial Breakdown

Contract Ceiling: $32,314,814

Exercised Options: $32,314,814

Current Obligation: $32,314,814

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DOCDG133012CQ0004

IDV Type: IDC

Timeline