DoD's $5.6M contract for CANES development and sustainment awarded to Microsoft Corporation
Contract Overview
Contract Amount: $5,646,757 ($5.6M)
Contractor: Microsoft Corporation
Awarding Agency: Department of Defense
Start Date: 2021-12-30
End Date: 2026-12-20
Contract Duration: 1,816 days
Daily Burn Rate: $3.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: PMW 160 CANES DEVELOPMENT AND SUSTAINMENT MICROSOFT CONSULTING SERVICES (MCS) AND MICROSOFT PREMIER SUPPORT (MPS)
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92110
Plain-Language Summary
Department of Defense obligated $5.6 million to MICROSOFT CORPORATION for work described as: PMW 160 CANES DEVELOPMENT AND SUSTAINMENT MICROSOFT CONSULTING SERVICES (MCS) AND MICROSOFT PREMIER SUPPORT (MPS) Key points: 1. Contract awarded to a single vendor, Microsoft Corporation, for specialized services. 2. The contract focuses on Computer Systems Design Services, a critical IT sector. 3. Potential risk associated with sole-source procurement and lack of competitive pricing. 4. Spending is concentrated within the Defense sector, specifically the Information Technology sub-sector.
Value Assessment
Rating: questionable
The contract's value of $5.6M for Microsoft consulting and support needs further benchmarking against similar sole-source agreements. Without competition, it's difficult to ascertain if this represents a fair market price.
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 taxpayers.
Taxpayer Impact: The lack of competition for these essential IT services may result in taxpayers paying a premium compared to a competitively bid contract.
Public Impact
Ensures continued development and sustainment of the CANES system for the Department of Defense. Provides access to Microsoft's specialized expertise and support for critical IT infrastructure. Potential for increased costs due to the absence of competitive bidding.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
Positive Signals
- Access to specialized vendor expertise
- Ensures system sustainment
Sector Analysis
This contract falls within the IT sector, specifically Computer Systems Design Services. Defense IT spending often involves specialized software and hardware, making sole-source contracts with major vendors like Microsoft common, though they warrant careful oversight.
Small Business Impact
This contract does not appear to involve small business participation, as it is a direct award to Microsoft Corporation for specialized services.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight from the Defense Information Systems Agency to ensure the services provided are necessary and priced appropriately.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Sole-source award
- Lack of competitive bidding
- Potential for price creep
- Vendor lock-in risk
Tags
computer-systems-design-services, department-of-defense, ca, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $5.6 million to MICROSOFT CORPORATION. PMW 160 CANES DEVELOPMENT AND SUSTAINMENT MICROSOFT CONSULTING SERVICES (MCS) AND MICROSOFT PREMIER SUPPORT (MPS)
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 $5.6 million.
What is the period of performance?
Start: 2021-12-30. End: 2026-12-20.
What is the justification for awarding this contract on a sole-source basis?
The justification for a sole-source award typically centers on the unique capabilities or proprietary nature of the product or service offered by a specific vendor. For Microsoft services, this often relates to specialized knowledge of their software ecosystem, which may not be readily available from other sources, thus ensuring continuity and expertise in critical systems.
What are the risks associated with relying on a single vendor for critical IT sustainment?
Relying on a single vendor like Microsoft for critical IT sustainment poses risks such as vendor lock-in, potential price escalation without competitive pressure, and dependence on the vendor's roadmap and support availability. This can limit flexibility and potentially increase long-term costs for the government.
How will the effectiveness of these consulting and support services be measured?
Effectiveness will likely be measured through performance metrics outlined in the contract, such as response times for support, successful resolution of technical issues, and timely delivery of development milestones. Regular reviews and user feedback from the Defense Information Systems Agency will also be crucial in assessing the value and impact of these services.
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: $6,291,194
Exercised Options: $6,291,194
Current Obligation: $5,646,757
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC102817D0001
IDV Type: IDC
Timeline
Start Date: 2021-12-30
Current End Date: 2026-12-20
Potential End Date: 2026-12-20 00:00:00
Last Modified: 2025-12-19
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