DoD Spends $79M on Microsoft Consulting for Computer Systems Design Services
Contract Overview
Contract Amount: $79,136,164 ($79.1M)
Contractor: Microsoft Corporation
Awarding Agency: Department of Defense
Start Date: 2018-09-28
End Date: 2021-09-29
Contract Duration: 1,097 days
Daily Burn Rate: $72.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: MICROSOFT CONSULTING SERVICE LABOR
Place of Performance
Location: FORT GEORGE G MEADE, ANNE ARUNDEL County, MARYLAND, 20755
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $79.1 million to MICROSOFT CORPORATION for work described as: MICROSOFT CONSULTING SERVICE LABOR Key points: 1. Significant spending on a single vendor, Microsoft Corporation. 2. Contract awarded for Computer Systems Design Services. 3. High value contract with a duration of nearly three years. 4. No small business participation noted.
Value Assessment
Rating: questionable
The contract value of $79.1M for consulting services is substantial. Without specific details on the services rendered and comparable market rates for Microsoft's specialized consulting, it's difficult to definitively assess value. However, the lack of competition raises concerns about potential overpricing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Microsoft Corporation. This limits price discovery and potentially leads to higher costs for the government compared to a competitive bidding process.
Taxpayer Impact: The lack of competition for a nearly $80 million contract means taxpayers may not have received the best possible price for these services.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. Reliance on a single vendor for critical IT consulting services can create dependency. The Defense Information Systems Agency's spending patterns warrant scrutiny for efficiency.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- High contract value
- No small business participation
Positive Signals
- Clear vendor identified
- Defined contract period
Sector Analysis
This contract falls under Computer Systems Design Services, a broad category within the IT sector. Government spending in this area is often substantial, but competitive procurement is crucial to ensure cost-effectiveness.
Small Business Impact
The contract data indicates no small business participation (ss: false, sb: false). This suggests that the procurement strategy did not include provisions to engage small businesses, potentially missing opportunities for innovation and economic development.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight to ensure the services provided are necessary, performed effectively, and priced reasonably. Transparency in the justification for not competing is also critical.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Potential for overpayment due to lack of competition.
- Risk of vendor lock-in and dependency.
- Lack of transparency in the sole-source justification.
- Missed opportunities for small business engagement.
Tags
computer-systems-design-services, department-of-defense, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $79.1 million to MICROSOFT CORPORATION. MICROSOFT CONSULTING SERVICE LABOR
Who is the contractor on this award?
The obligated recipient is MICROSOFT CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $79.1 million.
What is the period of performance?
Start: 2018-09-28. End: 2021-09-29.
What specific consulting services were provided under this contract, and how do they align with the agency's core mission requirements?
The contract specifies 'Computer Systems Design Services.' However, the exact nature of the consulting is not detailed. It could range from software development and integration to system architecture and cybersecurity consulting. Understanding the specific deliverables is crucial to assess their necessity and value against the agency's strategic objectives and operational needs.
What was the justification for awarding this contract on a sole-source basis instead of conducting a competitive procurement?
Sole-source awards are typically justified when only one vendor possesses the unique capabilities, proprietary technology, or specialized expertise required for the service, or in cases of urgent and compelling need. For a contract of this magnitude, a thorough justification and documentation process would be expected to demonstrate why competition was not feasible or advantageous.
How does the $79 million expenditure compare to industry benchmarks for similar Microsoft consulting engagements, and what measures were in place to ensure fair pricing?
Benchmarking this specific engagement is challenging without detailed service scope. However, government agencies often use independent cost estimates and market research to validate pricing for sole-source contracts. The absence of competition makes it harder to ascertain if the 'best value' was achieved, highlighting a potential risk of inflated costs.
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
Solicitation ID: HC102816R0024
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: ONE MICROSOFT WAY, REDMOND, WA, 98052
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: $79,136,164
Exercised Options: $79,136,164
Current Obligation: $79,136,164
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC102817D0001
IDV Type: IDC
Timeline
Start Date: 2018-09-28
Current End Date: 2021-09-29
Potential End Date: 2021-09-29 00:00:00
Last Modified: 2023-09-29
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