DoD's Defense Health Agency Spends $27.7M on Palo Alto Software Support via Full and Open Competition
Contract Overview
Contract Amount: $27,723,454 ($27.7M)
Contractor: Four LLC
Awarding Agency: Department of Defense
Start Date: 2018-04-05
End Date: 2022-04-04
Contract Duration: 1,460 days
Daily Burn Rate: $19.0K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ANNUAL PALO ALTO SOFTWARE SUPPORT
Place of Performance
Location: SAN ANTONIO, BEXAR County, TEXAS, 78234
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $27.7 million to FOUR LLC for work described as: ANNUAL PALO ALTO SOFTWARE SUPPORT Key points: 1. Significant spending on essential software support for the Defense Health Agency. 2. Competition method indicates a deliberate effort to ensure fair pricing. 3. Potential risk associated with vendor lock-in for specialized software. 4. IT services sector, specifically software support, is a critical area for government operations.
Value Assessment
Rating: good
The total award of $27.7M over four years suggests a substantial but potentially reasonable price for enterprise-level software support. Benchmarking against similar large-scale software support contracts would be necessary for a definitive assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while sources were initially excluded, the final award was open. This method aims to maximize competition and achieve best value.
Taxpayer Impact: The competitive nature of the award suggests that taxpayers are likely receiving a fair price for the software support services provided.
Public Impact
Ensures continued operation of critical health IT systems for military personnel and their families. Supports the Defense Health Agency's mission to provide healthcare services. Potential for cost savings through competitive bidding on essential software.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Reliance on a single software vendor can lead to future price increases.
- Potential for disruption if vendor support is withdrawn or significantly altered.
Positive Signals
- Awarded through full and open competition, maximizing potential for best value.
- Long-term contract provides stability for critical IT infrastructure.
Sector Analysis
This contract falls within the IT services sector, specifically focusing on software support for a critical government agency. Spending benchmarks for similar enterprise software support contracts can vary widely based on the software's complexity and user base.
Small Business Impact
The data does not indicate whether small businesses were involved in this specific contract, either as prime contractors or subcontractors. Further investigation would be needed to assess small business participation.
Oversight & Accountability
The contract was awarded by the Defense Health Agency, a component of the Department of Defense, which has established oversight mechanisms for its procurements. The 'Full and Open Competition' method suggests a degree of diligence in the acquisition process.
Related Government Programs
- Other Computer Related Services
- Department of Defense Contracting
- Defense Health Agency Programs
Risk Flags
- Potential for vendor lock-in.
- Lack of specific software details hinders precise cost-benefit analysis.
- Reliance on a single vendor for critical IT infrastructure.
- Need for ongoing monitoring of software performance and vendor responsiveness.
Tags
other-computer-related-services, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $27.7 million to FOUR LLC. ANNUAL PALO ALTO SOFTWARE SUPPORT
Who is the contractor on this award?
The obligated recipient is FOUR LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Health Agency).
What is the total obligated amount?
The obligated amount is $27.7 million.
What is the period of performance?
Start: 2018-04-05. End: 2022-04-04.
What is the specific Palo Alto software being supported, and what is its criticality to DHA operations?
The specific Palo Alto software is not detailed in the provided data. However, given its support by the Defense Health Agency, it is likely a critical component of their IT infrastructure, potentially related to network security, endpoint protection, or cloud services essential for managing health records and operations.
How does the per-unit cost of this support compare to industry benchmarks for similar enterprise-level software?
Without knowing the specific software product and the scope of support (e.g., number of licenses, level of service), a direct per-unit cost comparison is not feasible. However, the total award of $27.7M over four years for enterprise software support warrants a detailed benchmark analysis against comparable contracts in the public and private sectors.
What are the long-term implications of this contract on DHA's IT budget and potential for future vendor lock-in?
This contract represents a significant, ongoing expenditure. Long-term implications include potential budget strain if costs escalate and a risk of vendor lock-in, making it difficult and costly to switch to alternative solutions in the future. Proactive planning for contract renewal or transition is crucial.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 2303 DULLES STATION BLVD STE 105, HERNDON, VA, 20171
Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $27,723,454
Exercised Options: $27,723,454
Current Obligation: $27,723,454
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: NNG15SC73B
IDV Type: GWAC
Timeline
Start Date: 2018-04-05
Current End Date: 2022-04-04
Potential End Date: 2023-04-04 00:00:00
Last Modified: 2025-01-23
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