DoD Awards IBM $98.9M for Air Force Enterprise Support Services, Ending July 2026
Contract Overview
Contract Amount: $98,918,075 ($98.9M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of Defense
Start Date: 2024-08-03
End Date: 2026-07-02
Contract Duration: 698 days
Daily Burn Rate: $141.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: A4 AND SAF/IE ENTERPRISE SUPPORT SERVICES (ESS)
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20301
Plain-Language Summary
Department of Defense obligated $98.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: A4 AND SAF/IE ENTERPRISE SUPPORT SERVICES (ESS) Key points: 1. Significant contract value of $98.9 million for essential enterprise support. 2. IBM secures a large contract, indicating strong competitive positioning. 3. Risk is moderate, tied to contract duration and service complexity. 4. Spending falls within the Engineering Services sector.
Value Assessment
Rating: good
The contract value of $98.9 million for a 2-year period appears reasonable for enterprise support services. Benchmarking against similar large-scale IT support contracts would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a robust price discovery process. This method typically leads to more competitive pricing for the government.
Taxpayer Impact: The competitive award process is expected to yield good value for taxpayer dollars by ensuring fair market pricing.
Public Impact
Ensures continued operational support for critical Air Force enterprise systems. Supports national defense infrastructure through essential IT services. IBM's role in this contract impacts its market share in government IT services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Contract duration of nearly two years.
- Reliance on a single large contractor for critical services.
Positive Signals
- Awarded through full and open competition.
- Firm Fixed Price contract type limits cost overrun risk.
Sector Analysis
This contract falls under Engineering Services, specifically supporting enterprise IT infrastructure. Spending benchmarks for similar large-scale support services for defense agencies are typically in the tens to hundreds of millions.
Small Business Impact
The data indicates that small businesses were not directly involved in this prime contract award. Further analysis would be needed to determine if subcontracting opportunities exist.
Oversight & Accountability
The Department of the Air Force is responsible for oversight. The firm fixed price contract type provides some accountability for performance and cost.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Contract duration
- Potential for vendor lock-in
- Reliance on a single large provider for critical services
Tags
engineering-services, department-of-defense, dc, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $98.9 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. A4 AND SAF/IE ENTERPRISE SUPPORT SERVICES (ESS)
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $98.9 million.
What is the period of performance?
Start: 2024-08-03. End: 2026-07-02.
What specific enterprise support services are included in this contract?
The contract details are for 'A4 AND SAF/IE ENTERPRISE SUPPORT SERVICES (ESS)'. While specific services are not itemized in the provided data, ESS typically encompasses a broad range of IT support functions including help desk, system maintenance, network operations, and potentially cybersecurity support for enterprise-level applications and infrastructure.
What is the potential risk associated with the contract's duration?
A contract duration of nearly two years (698 days) for enterprise support services carries a moderate risk. While it provides stability, it also means the Air Force is locked into IBM's services for an extended period, potentially missing out on newer technologies or more cost-effective solutions that might emerge. It also requires diligent performance monitoring to ensure continued value.
How does this contract contribute to the overall effectiveness of Air Force operations?
This contract is crucial for the effectiveness of Air Force operations by ensuring the stability and functionality of its enterprise IT systems. Reliable ESS prevents disruptions to critical administrative, logistical, and operational functions, allowing personnel to focus on core mission objectives rather than IT issues. It underpins the digital infrastructure necessary for modern military operations.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: FA701424R0016
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, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $287,933,676
Exercised Options: $109,305,950
Current Obligation: $98,918,075
Actual Outlays: $17,624,306
Subaward Activity
Number of Subawards: 46
Total Subaward Amount: $47,433,122
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00Q14OADU145
IDV Type: IDC
Timeline
Start Date: 2024-08-03
Current End Date: 2026-07-02
Potential End Date: 2029-07-02 00:00:00
Last Modified: 2025-09-30
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