DoD's $15.2M Cloud Hosting Contract Awarded to Sev1Tech for Technical Support
Contract Overview
Contract Amount: $15,241,286 ($15.2M)
Contractor: Sev1tech, LLC
Awarding Agency: Department of Defense
Start Date: 2019-07-10
End Date: 2021-11-30
Contract Duration: 874 days
Daily Burn Rate: $17.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 7
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: CLOUD HOSTING, TRANSITION, AND MODERNIZATION TECHNICAL SUPPORT
Place of Performance
Location: NORTH CHARLESTON, CHARLESTON County, SOUTH CAROLINA, 29419
Plain-Language Summary
Department of Defense obligated $15.2 million to SEV1TECH, LLC for work described as: CLOUD HOSTING, TRANSITION, AND MODERNIZATION TECHNICAL SUPPORT Key points: 1. Contract value represents a significant investment in cloud infrastructure modernization. 2. Full and open competition suggests a potentially competitive bidding process. 3. The cost-plus-fixed-fee structure requires careful monitoring to control overall costs. 4. Performance period spans over two years, indicating a substantial project scope. 5. The contract is a delivery order, suggesting it's part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 6. Focus on technical support highlights the need for specialized expertise in cloud environments.
Value Assessment
Rating: fair
Benchmarking the value of this $15.2 million contract is challenging without specific details on the scope of services and deliverables. However, the cost-plus-fixed-fee (CPFF) pricing structure can sometimes lead to higher overall costs compared to fixed-price contracts if not managed diligently. Comparing this to similar cloud hosting and modernization contracts within the Department of Defense would provide a clearer picture of value for money. The number of bids received (7) suggests some level of competition, but the final price and value depend heavily on the efficiency and effectiveness of the contractor's performance.
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 bids. Seven bids were received, suggesting a reasonably competitive environment. The level of competition is a positive sign for price discovery, as multiple vendors vied for the contract. However, the specific details of the solicitation and evaluation criteria would further illuminate the true extent of the competitive dynamics.
Taxpayer Impact: A competitive bidding process generally benefits taxpayers by driving down prices and encouraging innovation. The fact that seven companies competed for this contract suggests that taxpayer dollars are likely being used more efficiently than in a sole-source scenario.
Public Impact
The Department of the Navy benefits from enhanced cloud hosting, transition, and modernization capabilities. This contract supports the delivery of critical technical support services for cloud infrastructure. The contract's performance is primarily focused within South Carolina, indicating a geographic concentration of impact. The contract likely supports a workforce skilled in cloud technologies, cybersecurity, and IT infrastructure management.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize cost overruns if not closely monitored.
- The duration of the contract (874 days) requires sustained oversight to ensure performance remains on track.
- Reliance on a single contractor for critical cloud support could pose a risk if performance degrades.
Positive Signals
- Awarded under full and open competition, indicating a robust selection process.
- The contract addresses a critical need for cloud hosting and modernization, aligning with current defense IT strategies.
- The contractor, SEV1TECH, LLC, has experience in government contracting, suggesting a degree of familiarity with federal requirements.
Sector Analysis
This contract falls within the broader Information Technology (IT) sector, specifically focusing on cloud services, which is a rapidly growing segment of the federal IT market. The Department of Defense is a major consumer of cloud solutions, investing heavily in migrating legacy systems and modernizing infrastructure for enhanced agility and security. Comparable spending benchmarks for cloud hosting and technical support services within federal agencies often run into the tens or hundreds of millions of dollars annually, reflecting the scale of these initiatives.
Small Business Impact
This contract was not awarded as a small business set-aside, nor does it indicate specific subcontracting goals for small businesses in the provided data. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for subcontracting opportunities. Further analysis of subcontracting plans would be needed to assess the broader implications for small businesses.
Oversight & Accountability
Oversight for this contract would typically be managed by the Department of the Navy's contracting officers and program managers. The cost-plus-fixed-fee structure necessitates rigorous financial oversight to ensure costs are reasonable and allocable. Transparency is generally facilitated through contract reporting mechanisms, and any concerns regarding performance or cost would likely fall under the purview of the Department of Defense's Inspector General.
Related Government Programs
- DoD Cloud Computing Strategy
- General Services Administration (GSA) Cloud Purchasing Vehicles
- IT Modernization Initiatives
- Defense Information Systems Agency (DISA) Cloud Services
Risk Flags
- Cost-plus-fixed-fee contract type requires diligent oversight to manage potential cost escalations.
- The scope of 'technical support' is broad and requires clear definition of deliverables and performance standards.
- Transition and modernization efforts can be complex and prone to unforeseen challenges.
Tags
it, defense, cloud-hosting, technical-support, full-and-open-competition, delivery-order, cost-plus-fixed-fee, department-of-the-navy, south-carolina, engineering-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.2 million to SEV1TECH, LLC. CLOUD HOSTING, TRANSITION, AND MODERNIZATION TECHNICAL SUPPORT
Who is the contractor on this award?
The obligated recipient is SEV1TECH, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $15.2 million.
What is the period of performance?
Start: 2019-07-10. End: 2021-11-30.
What is the track record of SEV1TECH, LLC in delivering cloud hosting and modernization services to the federal government?
SEV1TECH, LLC has a history of performing IT services for federal agencies, including cloud-related projects. While specific details on their cloud hosting and modernization success rates for the DoD are not fully detailed in this summary, their presence as a contractor suggests they possess the necessary clearances and capabilities. A deeper dive into their past performance evaluations, contract awards, and client feedback would provide a more comprehensive understanding of their track record. Their ability to secure this $15.2 million contract under full and open competition indicates a level of confidence from the awarding agency in their past performance and technical qualifications.
How does the pricing structure (Cost Plus Fixed Fee) compare to other cloud hosting contracts of similar scope within the DoD?
Cost Plus Fixed Fee (CPFF) contracts are common in complex IT projects where the scope may evolve or is difficult to define precisely upfront. While CPFF can offer flexibility, it carries a higher risk of cost overruns compared to fixed-price contracts if not managed stringently. Benchmarking this contract's fixed fee against the total estimated cost and comparing the overall contract value to similar cloud modernization efforts within the DoD would be crucial. Agencies often aim for fixed-price or performance-based contracts when scope is well-defined to ensure better cost certainty for taxpayers. The CPFF structure here suggests the Navy prioritized flexibility and technical expertise over strict cost predictability at the outset.
What are the key performance indicators (KPIs) used to measure the success of this cloud hosting and modernization contract?
The provided data does not specify the Key Performance Indicators (KPIs) for this contract. However, for cloud hosting, transition, and modernization technical support, typical KPIs would likely include metrics related to system uptime and availability, response times for technical support, successful migration of services, security compliance adherence, and project milestone completion. The effectiveness of the contractor's performance would be evaluated against these predefined metrics, which are usually detailed in the contract's Statement of Work (SOW) or Performance Work Statement (PWS).
What is the historical spending pattern for cloud hosting and modernization services by the Department of the Navy?
The Department of the Navy, like other branches of the DoD, has significantly increased its spending on cloud hosting and modernization services over the past decade. This trend is driven by the military's strategic imperative to adopt cloud technologies for enhanced operational capabilities, data analytics, and cybersecurity. Historical spending data would show a consistent upward trajectory, with substantial investments in various cloud service models (IaaS, PaaS, SaaS) and related technical support. This specific $15.2 million contract is likely one of many contributing to the Navy's broader cloud adoption strategy.
What are the potential risks associated with the transition and modernization aspects of this contract?
The transition and modernization aspects of cloud contracts carry inherent risks, including potential disruptions to existing services, data migration errors, cybersecurity vulnerabilities during the transition phase, integration challenges with legacy systems, and scope creep. For this contract, risks could also involve the contractor's ability to manage complex technical challenges, ensure seamless user experience, and meet stringent security requirements. Effective risk mitigation strategies, including thorough planning, phased rollouts, robust testing, and continuous monitoring, are essential to address these potential issues.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N6523619R3032
Offers Received: 7
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12700 BLACK FOREST LN STE 306, WOODBRIDGE, VA, 22192
Business Categories: Category Business, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $18,132,293
Exercised Options: $18,132,293
Current Obligation: $15,241,286
Actual Outlays: $3,094,228
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0017814D7693
IDV Type: IDC
Timeline
Start Date: 2019-07-10
Current End Date: 2021-11-30
Potential End Date: 2021-11-30 00:00:00
Last Modified: 2025-09-29
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