DHS spent over $52M on Microsoft licenses via Dell, a BPA Call awarded under full and open competition
Contract Overview
Contract Amount: $52,056,519 ($52.1M)
Contractor: Dell Marketing L.P.
Awarding Agency: Department of Homeland Security
Start Date: 2010-06-25
End Date: 2011-06-30
Contract Duration: 370 days
Daily Burn Rate: $140.7K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: MICROSOFT ENTERPRISE LICENSE PURCHASE
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20528
Plain-Language Summary
Department of Homeland Security obligated $52.1 million to DELL MARKETING L.P. for work described as: MICROSOFT ENTERPRISE LICENSE PURCHASE Key points: 1. Value for money appears fair given the scale of enterprise software licensing. 2. Competition dynamics indicate a broad market approach, potentially leading to better pricing. 3. Risk indicators are moderate, typical for large enterprise software procurements. 4. Performance context is a single-year contract for essential software. 5. Sector positioning is within IT hardware and software procurement for a major federal agency.
Value Assessment
Rating: fair
The contract value of $52 million for Microsoft enterprise licenses over one year represents a significant investment. Benchmarking against similar large-scale federal software procurements is challenging without specific license details and volume discounts. However, the firm-fixed-price structure suggests predictable costs. The award to Dell, a major reseller, implies a competitive bidding process for the underlying Microsoft products.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The specific award mechanism was a BPA Call, suggesting it was a call-off from an existing Blanket Purchase Agreement. The level of competition for the BPA itself would determine the initial price discovery, but the call-off likely involved competitive quotes among BPA holders.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can drive down prices and encourage innovation from multiple vendors.
Public Impact
Department of Homeland Security (DHS) personnel benefit from access to essential Microsoft software. Services delivered include the provision of enterprise-level software licenses. Geographic impact is national, supporting DHS operations across various locations. Workforce implications involve enabling productivity for thousands of DHS employees.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in with enterprise software agreements.
- Reliance on a single software vendor (Microsoft) can create long-term dependencies.
- Ensuring optimal license utilization to avoid overspending.
Positive Signals
- Awarded through a competitive process, suggesting a degree of price reasonableness.
- Firm-fixed-price contract provides cost certainty for the agency.
- Use of a BPA Call streamlines the procurement process for recurring needs.
Sector Analysis
This contract falls within the Information Technology sector, specifically focusing on software licensing and procurement. The market for enterprise software licenses is dominated by a few major players like Microsoft, with resellers like Dell playing a crucial role in distribution. Federal spending on IT, including software, is substantial, often involving complex licensing agreements to meet the needs of large agencies like DHS.
Small Business Impact
The provided data does not indicate any specific small business set-aside or subcontracting requirements for this particular BPA Call. As the award was made to Dell Marketing L.P., a large business, the focus would be on whether Dell itself utilizes small businesses in its supply chain or subcontracting efforts, which is not detailed here.
Oversight & Accountability
Oversight for this contract would typically reside within the Department of Homeland Security's procurement and program management offices. Accountability is established through the firm-fixed-price contract terms and performance expectations. Transparency is facilitated by contract award data made publicly available through systems like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.
Related Government Programs
- Microsoft Enterprise Agreements
- General Services Administration (GSA) Schedules
- IT Software Procurement
- Blanket Purchase Agreements (BPAs)
Risk Flags
- Potential for cost overruns if license utilization is not optimized.
- Dependency on a single software vendor.
- Contract duration is relatively short (approx. 1 year), requiring potential re-competition or extension.
Tags
it-software, dhs, dell-marketing-lp, microsoft, enterprise-license, firm-fixed-price, full-and-open-competition, bpa-call, district-of-columbia, fiscal-year-2010, fiscal-year-2011
Frequently Asked Questions
What is this federal contract paying for?
Department of Homeland Security awarded $52.1 million to DELL MARKETING L.P.. MICROSOFT ENTERPRISE LICENSE PURCHASE
Who is the contractor on this award?
The obligated recipient is DELL MARKETING L.P..
Which agency awarded this contract?
Awarding agency: Department of Homeland Security (Office of Procurement Operations).
What is the total obligated amount?
The obligated amount is $52.1 million.
What is the period of performance?
Start: 2010-06-25. End: 2011-06-30.
What specific Microsoft products and license types were included in this $52 million purchase?
The provided data does not specify the exact Microsoft products (e.g., Windows, Office, server licenses) or the types of licenses (e.g., perpetual, subscription, user-based, device-based) included in this $52 million purchase. This level of detail is typically found in the contract award documents or associated task orders under the BPA Call. Understanding the product mix and licensing model is crucial for a precise value assessment, as different products and license types have vastly different costs and lifecycles. Without this information, it's difficult to benchmark against specific software market rates.
How does the per-unit cost of these Microsoft licenses compare to commercial market rates or other federal agency purchases?
A direct per-unit cost comparison is not feasible with the provided data, as it lacks the specific product and license details. However, federal agencies often leverage volume purchasing power and negotiated discounts through agreements like BPAs to achieve rates competitive with, or even better than, commercial market rates. The fact that this was awarded under full and open competition suggests that Dell likely offered competitive pricing. To perform a true benchmark, one would need to identify the specific SKUs and compare them against current General Services Administration (GSA) Schedule pricing, Microsoft's Volume Licensing pricing, or publicly available commercial price lists for similar quantities.
What was the original Blanket Purchase Agreement (BPA) that this call was placed against, and what were its terms?
The data indicates this was a 'BPA CALL' awarded to DELL MARKETING L.P. by the Department of Homeland Security. This implies that a foundational Blanket Purchase Agreement (BPA) was already in place, likely established through a separate competitive process. The BPA would have outlined the general terms, conditions, and potentially pre-negotiated pricing or discount structures under which multiple call orders could be issued. The specific details of the parent BPA, such as its expiration date, scope, and the number of participating vendors, are not provided here but are essential for understanding the full procurement context and the competitive landscape that led to this specific call order.
What is the track record of Dell Marketing L.P. in fulfilling large federal IT software contracts for DHS?
Dell Marketing L.P. is a major federal IT contractor with a significant history of providing hardware, software, and services to various government agencies, including DHS. While this specific contract highlights a substantial expenditure on Microsoft licenses, Dell's broader track record involves a wide range of IT solutions. Assessing their performance on this particular contract would require reviewing past performance evaluations, any contract disputes, or on-time delivery metrics associated with this BPA Call or related agreements. Generally, large vendors like Dell have established processes for managing federal procurements, but individual contract performance can vary.
Were there any specific performance metrics or service level agreements (SLAs) tied to this Microsoft license purchase?
The provided data focuses on the contract award details (vendor, amount, dates, competition type) and does not include information on specific performance metrics or Service Level Agreements (SLAs). For enterprise software licenses, SLAs might relate to availability of support, response times for technical issues, or timely delivery of license keys/entitlements. It is common for large IT procurements, especially those involving ongoing services or support, to have associated SLAs. These would typically be detailed within the full contract documentation or the terms of the BPA under which this call was issued.
How does this $52 million expenditure compare to DHS's overall IT software spending in fiscal year 2010-2011?
To compare this $52 million expenditure to DHS's overall IT software spending for FY 2010-2011, we would need access to DHS's comprehensive IT budget and spending reports for that period. This single contract represents a significant portion of enterprise software acquisition, but DHS's total IT budget likely encompasses a much broader range of expenditures, including hardware, networking, cybersecurity, cloud services, and other software categories. Without aggregated spending data for DHS's IT portfolio during that timeframe, it's difficult to contextualize the relative size of this Microsoft license purchase within the agency's total technology investment.
Industry Classification
NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Dell Technologies Inc. (UEI: 601839660)
Address: ONE DELL WAY, ROUND ROCK, TX, 78682
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $52,056,519
Exercised Options: $52,056,519
Current Obligation: $52,056,519
Parent Contract
Parent Award PIID: HSHQDC09A00032
IDV Type: BPA
Timeline
Start Date: 2010-06-25
Current End Date: 2011-06-30
Potential End Date: 2011-06-30 00:00:00
Last Modified: 2017-01-23
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