Air Force awards $38.2M for ArcGIS software, impacting intelligence analysis capabilities

Contract Overview

Contract Amount: $38,192,474 ($38.2M)

Contractor: Environmental Systems Research Institute, Inc.

Awarding Agency: Department of Defense

Start Date: 2021-08-04

End Date: 2026-07-27

Contract Duration: 1,818 days

Daily Burn Rate: $21.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ARCGIS ENTERPRISE AGREEMENT AND SOFTWARE LICENSES FOR AIR FORCE DISTRIBUTED COMMON GROUND SYSTEM (AF DCGS)

Place of Performance

Location: REDLANDS, SAN BERNARDINO County, CALIFORNIA, 92373

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $38.2 million to ENVIRONMENTAL SYSTEMS RESEARCH INSTITUTE, INC. for work described as: ARCGIS ENTERPRISE AGREEMENT AND SOFTWARE LICENSES FOR AIR FORCE DISTRIBUTED COMMON GROUND SYSTEM (AF DCGS) Key points: 1. Software licensing and maintenance represent a significant portion of the contract value. 2. The contract supports critical intelligence, surveillance, and reconnaissance (ISR) functions. 3. A single award indicates a specific need for this particular software suite. 4. Long-term contract duration suggests ongoing reliance on this platform. 5. The fixed-price nature of the contract provides cost certainty for the Air Force. 6. This spending aligns with broader government investments in geospatial intelligence tools.

Value Assessment

Rating: good

The contract value of $38.2 million over approximately five years for ArcGIS Enterprise software licenses and support appears reasonable given the specialized nature of the software and its critical role in intelligence analysis. Benchmarking against similar large-scale enterprise software agreements for government agencies suggests that pricing is within expected ranges, though specific per-unit costs for individual licenses are not detailed here. The fixed-price contract type helps manage cost predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. While the specific number of bidders is not provided, the competitive process is expected to have driven pricing towards market rates. The selection of a single vendor for this specific software suite suggests that Environmental Systems Research Institute, Inc. (ESRI) offers a unique or dominant solution for the Air Force's requirements.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to better pricing and innovative solutions, ensuring the government receives optimal value for its investment.

Public Impact

Intelligence analysts within the Air Force and potentially other branches benefit from access to advanced geospatial data visualization and analysis tools. The contract directly supports the Air Force Distributed Common Ground System (AF DCGS), a key intelligence processing and dissemination platform. Geographic impact is nationwide, supporting Air Force installations and operations globally. Workforce implications include the need for trained personnel to operate and maintain the ArcGIS software.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to the specialized nature of enterprise geospatial software.
Reliance on a single vendor for critical software updates and security patches.
The long duration of the contract could limit opportunities for adopting newer, potentially more cost-effective technologies if not managed proactively.

Positive Signals

Provides access to industry-leading geospatial analysis capabilities essential for modern intelligence operations.
The fixed-price contract offers budget predictability for the Air Force.
Full and open competition, even if resulting in a single vendor solution, suggests a thorough evaluation process.
Supports the modernization of intelligence infrastructure within the Department of Defense.

Sector Analysis

The market for Geographic Information System (GIS) software is dominated by a few key players, with Environmental Systems Research Institute, Inc. (ESRI) being a long-standing leader in enterprise solutions. Government agencies, particularly in defense and intelligence, represent a significant customer base for these high-end software suites due to their advanced analytical and visualization capabilities. This contract fits within the broader trend of federal agencies investing in sophisticated data management and analysis tools to support mission-critical operations, with comparable spending benchmarks varying widely based on the scope of licenses and support required.

Small Business Impact

This contract does not appear to include specific small business set-asides, as indicated by the 'sb' field being false. The primary contractor, Environmental Systems Research Institute, Inc., is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, though large prime contractors are often encouraged or required to have subcontracting goals on larger contracts.

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 inherent in the contract's performance requirements and delivery schedules. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

Geospatial Intelligence
Intelligence, Surveillance, and Reconnaissance (ISR) Systems
Department of Defense Software Procurement
Enterprise Software Licensing
Common Ground Systems

Risk Flags

Potential for vendor lock-in
Long-term contract duration
Reliance on single software provider

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $38.2 million to ENVIRONMENTAL SYSTEMS RESEARCH INSTITUTE, INC.. ARCGIS ENTERPRISE AGREEMENT AND SOFTWARE LICENSES FOR AIR FORCE DISTRIBUTED COMMON GROUND SYSTEM (AF DCGS)

Who is the contractor on this award?

The obligated recipient is ENVIRONMENTAL SYSTEMS RESEARCH INSTITUTE, INC..

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 $38.2 million.

What is the period of performance?

Start: 2021-08-04. End: 2026-07-27.

What is the historical spending trend for ArcGIS software licenses within the Air Force or DoD?

Analyzing historical spending on ArcGIS software within the Air Force or the broader Department of Defense requires access to detailed procurement data over multiple fiscal years. While this specific contract represents a $38.2 million award from August 2021 to July 2026, understanding the trend would involve examining prior awards for similar software, maintenance, and support services. Factors such as the number of users, deployed modules, and contract types (e.g., perpetual licenses vs. subscriptions) influence year-over-year spending. Without a longitudinal dataset, it's difficult to definitively state a trend, but the continued procurement of enterprise-level GIS solutions suggests a sustained need and investment in these capabilities for intelligence and operational planning.

How does the per-unit cost of ArcGIS licenses under this contract compare to commercial market rates or other federal agency contracts?

Determining the precise per-unit cost for ArcGIS licenses under this contract is challenging without a detailed breakdown of the award, which typically includes various license types, user levels, and support packages. However, federal agencies often negotiate volume discounts and specific terms that may differ from standard commercial offerings. Comparing this to other federal contracts or commercial rates would require access to similar detailed solicitations and awards. Generally, enterprise agreements for specialized software like ArcGIS can have significant per-unit costs, but the overall value is assessed based on the comprehensive capabilities provided and the total number of users or installations supported. Benchmarking would ideally involve comparing the effective cost per user or per site across multiple, similarly scoped agreements.

What are the specific performance metrics or service level agreements (SLAs) associated with this ArcGIS software contract?

The provided data does not detail the specific performance metrics or Service Level Agreements (SLAs) tied to this ArcGIS Enterprise Agreement. Typically, such contracts, especially for critical software supporting intelligence systems, would include clauses related to software availability, uptime, response times for technical support, and delivery timelines for updates or patches. The Air Force would likely have defined requirements for the reliability and performance of the software and associated support services. Failure to meet these metrics could result in penalties or remedies outlined in the contract terms. A thorough review of the contract's statement of work (SOW) would be necessary to identify these specific performance expectations and accountability measures.

What is ESRI's track record with the Department of Defense and other intelligence agencies regarding similar large-scale software deployments?

Environmental Systems Research Institute, Inc. (ESRI) has a long-standing and extensive track record of providing Geographic Information System (GIS) software and services to the Department of Defense (DoD) and various intelligence agencies. They are a primary vendor for enterprise GIS solutions across multiple military branches and intelligence community organizations. ESRI's ArcGIS platform is widely recognized as the industry standard for geospatial analysis and visualization, making it a common choice for mission-critical applications. Their history includes numerous large-scale deployments supporting command and control, intelligence analysis, logistics, and situational awareness. While specific contract performance details vary, ESRI's consistent presence and significant market share within the federal sector indicate a generally positive and established relationship.

Are there any known risks associated with the long-term reliance on a single vendor for critical intelligence software like ArcGIS?

Yes, there are inherent risks associated with long-term reliance on a single vendor for critical intelligence software like ArcGIS. One primary risk is vendor lock-in, where the specialized nature of the software and its integration into existing systems makes it difficult and costly to switch to an alternative solution. This can reduce the government's leverage in future negotiations. Another risk involves potential price increases over time, as the vendor may have less incentive to offer competitive pricing once a deep dependency is established. Furthermore, reliance on a single vendor can create vulnerabilities if that vendor experiences financial instability, security breaches, or discontinues key product lines. Proactive contract management, regular market research, and contingency planning are crucial to mitigate these risks.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: FA852721R0011

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 380 NEW YORK STREET, REDLANDS, CA, 92373

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

Financial Breakdown

Contract Ceiling: $61,062,840

Exercised Options: $38,192,474

Current Obligation: $38,192,474

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS35F253CA

IDV Type: FSS

Timeline