DoD's $37.35M DIP/MIP contract awarded to Dell Federal Systems L.P. for telephone apparatus manufacturing

Contract Overview

Contract Amount: $37,350,433 ($37.4M)

Contractor: Dell Federal Systems L.P

Awarding Agency: Department of Defense

Start Date: 2019-07-09

End Date: 2020-11-05

Contract Duration: 485 days

Daily Burn Rate: $77.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: DEPLOYABLE INTERCEPTOR PLATFORM/MOBILE INTERCEPTOR PLATFORM (DIP/MIP)

Place of Performance

Location: ROUND ROCK, WILLIAMSON County, TEXAS, 78682

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $37.4 million to DELL FEDERAL SYSTEMS L.P for work described as: DEPLOYABLE INTERCEPTOR PLATFORM/MOBILE INTERCEPTOR PLATFORM (DIP/MIP) Key points: 1. The contract value represents a significant investment in specialized communication equipment. 2. Competition dynamics for this contract are crucial for ensuring fair pricing and innovation. 3. Risk indicators may include supply chain dependencies and technological obsolescence. 4. Performance context is tied to the Department of the Air Force's operational needs. 5. This contract falls within the broader IT and Defense sectors, supporting critical infrastructure.

Value Assessment

Rating: fair

The contract value of $37.35 million for a 485-day duration appears moderate for specialized defense communication systems. Benchmarking against similar contracts for deployable or mobile interceptor platforms is challenging without more specific technical details. However, the firm-fixed-price structure suggests a defined cost expectation. Further analysis would require comparing the unit costs of the deployed apparatus against market rates for comparable, non-military grade equipment, adjusted for defense-specific requirements and reliability standards.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. With 3 bidders, the level of competition suggests a reasonable effort to solicit diverse solutions and potentially achieve competitive pricing. This approach is generally favorable for price discovery and ensuring the government receives the best value from the market.

Taxpayer Impact: Full and open competition benefits taxpayers by fostering a competitive environment that can drive down costs and encourage innovation, leading to more efficient use of public funds.

Public Impact

The Department of the Air Force is the primary beneficiary, receiving critical communication equipment. Services delivered include the provision of deployable and mobile interceptor platforms. The geographic impact is likely concentrated within operational theaters or training facilities. Workforce implications may involve specialized technicians for deployment and maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the chosen platform becomes proprietary.
Risk of cost overruns if unforeseen technical challenges arise during deployment.
Dependence on a single contractor for critical, specialized equipment.

Positive Signals

Awarded through full and open competition, suggesting market validation.
Firm-fixed-price contract provides cost certainty.
Multiple bidders indicate a healthy competitive landscape.

Sector Analysis

This contract operates within the Information Technology and Defense sectors, specifically focusing on specialized communication and interceptor platforms. The market for such defense-grade equipment is often characterized by high barriers to entry due to stringent security, reliability, and performance requirements. Comparable spending benchmarks would typically be found within other Department of Defense procurements for tactical communication systems or specialized mobile command centers, where values can range significantly based on complexity and quantity.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem may be limited unless Dell Federal Systems L.P. actively engages small businesses as subcontractors. Further investigation into subcontracting plans would be necessary to assess the full impact.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and program management offices. Accountability measures are embedded within the firm-fixed-price contract terms, requiring delivery of specified goods. Transparency is generally maintained through contract award databases, though detailed technical specifications and performance metrics may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Tactical Communication Systems
Mobile Command Centers
Defense Communication Networks
Interceptor Systems Procurement

Risk Flags

Potential for technology obsolescence
Supply chain vulnerability for specialized components
Integration complexity with existing military systems

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.4 million to DELL FEDERAL SYSTEMS L.P. DEPLOYABLE INTERCEPTOR PLATFORM/MOBILE INTERCEPTOR PLATFORM (DIP/MIP)

Who is the contractor on this award?

The obligated recipient is DELL FEDERAL SYSTEMS L.P.

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 $37.4 million.

What is the period of performance?

Start: 2019-07-09. End: 2020-11-05.

What is the specific technical capability of the DIP/MIP system and how does it compare to commercial off-the-shelf (COTS) alternatives?

The specific technical capabilities of the Deployable Interceptor Platform/Mobile Interceptor Platform (DIP/MIP) are not detailed in the provided data. However, defense-grade systems like these typically incorporate enhanced security features, ruggedization for harsh environments, and specialized communication protocols beyond those found in commercial off-the-shelf (COTS) alternatives. COTS solutions might offer lower unit costs but would likely require significant modification and integration efforts to meet the stringent reliability, survivability, and interoperability requirements of military operations. The $37.35 million award for 3 units (implied by 3 bidders, though not explicitly stated as units) suggests a high per-unit cost, indicative of specialized, low-volume production tailored for defense applications.

How does the $37.35 million contract value compare to historical spending on similar interceptor platforms by the Department of Defense?

Without specific historical data on similar interceptor platforms, a direct comparison of the $37.35 million contract value is difficult. However, the value appears substantial for what is described as 'Telephone Apparatus Manufacturing,' suggesting these are not standard telecommunication devices but highly specialized, potentially integrated systems. Historical spending on advanced military communication and interception technology can vary widely, from millions to billions, depending on the system's complexity, scale, and strategic importance. The firm-fixed-price nature of this award suggests a defined scope and budget, which is a positive indicator for cost control compared to cost-plus contracts often seen in R&D-intensive defense projects.

What are the primary risks associated with Dell Federal Systems L.P. fulfilling this contract, considering their track record?

The primary risks associated with Dell Federal Systems L.P. fulfilling this contract would generally revolve around their ability to deliver highly specialized, defense-grade interceptor platforms within the specified timeframe and budget. While Dell is a well-established technology provider, their specific experience with 'deployable interceptor platforms' in a military context needs to be assessed. Potential risks include supply chain disruptions for specialized components, integration challenges with existing military networks, and ensuring the platform meets stringent security and operational requirements. Their track record with the government, particularly in delivering complex, mission-critical systems, would be a key factor in evaluating these risks. The firm-fixed-price nature of the contract shifts some of the financial risk to the contractor.

What is the expected program effectiveness and impact of the DIP/MIP system on Air Force operations?

The expected program effectiveness and impact of the DIP/MIP system on Air Force operations are centered on enhancing communication capabilities, potentially for intelligence gathering, command and control, or tactical operations. As 'deployable' and 'mobile' systems, they are designed to provide critical functionality in diverse and potentially austere environments where fixed infrastructure may be unavailable or compromised. Their effectiveness will be measured by their reliability, ease of deployment, interoperability with existing Air Force networks, and the quality of data or communication they facilitate. The $37.35 million investment suggests a significant anticipated improvement in operational readiness or mission success rates for the units utilizing these platforms.

How has spending on 'Telephone Apparatus Manufacturing' for defense purposes evolved over the past five years?

Spending on 'Telephone Apparatus Manufacturing' for defense purposes has likely seen a shift towards more sophisticated, integrated communication and data interception systems rather than traditional telephony. While the NAICS code 334210 covers a broad range of telephone apparatus, defense spending within this category is increasingly focused on secure, mobile, and resilient communication solutions essential for modern warfare and intelligence gathering. This includes encrypted devices, satellite communication terminals, and specialized interceptor platforms. The $37.35 million contract awarded to Dell Federal Systems L.P. for DIP/MIP aligns with this trend, representing a move beyond basic voice communication towards advanced technological capabilities that support complex military operations and information dominance.

Industry Classification

NAICS: Manufacturing › Communications Equipment Manufacturing › Telephone Apparatus Manufacturing

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

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Dell Technologies Inc.

Address: 1 DELL WAY, ROUND ROCK, TX, 78682

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $80,905,666

Exercised Options: $79,905,666

Current Obligation: $37,350,433

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA873214D0002

IDV Type: IDC

Timeline