VA Spends $23.3M on Cloud Computing Services with Equinix Government Solutions LLC

Contract Overview

Contract Amount: $23,299,610 ($23.3M)

Contractor: Equinix Government Solutions LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2011-02-13

End Date: 2016-06-10

Contract Duration: 1,944 days

Daily Burn Rate: $12.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CLOUD COMPUTING SERVICES

Place of Performance

Location: HERNDON, FAIRFAX County, VIRGINIA, 20170

State: Virginia Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $23.3 million to EQUINIX GOVERNMENT SOLUTIONS LLC for work described as: CLOUD COMPUTING SERVICES Key points: 1. Significant spending on cloud services highlights reliance on external providers. 2. Equinix Government Solutions LLC secured a substantial contract, indicating strong market presence. 3. The contract duration and value suggest a long-term strategic investment in cloud infrastructure. 4. Analysis of 'Other Computer Related Services' (NAICS 541519) is crucial for understanding IT spending trends.

Value Assessment

Rating: good

The total award of $23.3M over approximately 5 years suggests a competitive pricing strategy was likely employed. Benchmarking against similar cloud service contracts would provide further insight into value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, which typically drives competitive pricing and ensures the best value for the government. The use of a delivery order indicates a specific need was met through this competitive process.

Taxpayer Impact: The competitive award process likely resulted in favorable pricing for taxpayers, ensuring efficient use of public funds for essential cloud computing services.

Public Impact

Veterans' access to digital services may be enhanced through improved cloud infrastructure. The contract supports the modernization of government IT systems, potentially leading to greater efficiency. Dependence on a single vendor for a significant portion of cloud services could pose a risk if not managed carefully.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Vendor lock-in potential
Data security and privacy concerns
Reliance on third-party infrastructure

Positive Signals

Leveraging specialized cloud expertise
Potential for cost savings through scale
Increased IT agility and scalability

Sector Analysis

The Department of Veterans Affairs' significant investment in cloud computing services falls within the broader IT sector. Spending benchmarks for cloud services vary widely based on scope and provider, but $23.3M over five years for a large agency indicates a substantial commitment.

Small Business Impact

The contract was awarded to Equinix Government Solutions LLC, a large business. There is no indication of small business participation in this specific contract, which is common for large-scale IT infrastructure procurements.

Oversight & Accountability

The contract was awarded by the Department of Veterans Affairs, indicating internal oversight. The use of full and open competition suggests a structured procurement process aimed at accountability.

Related Government Programs

Other Computer Related Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Contract awarded to a large business
Long contract duration (approx. 5 years)
Potential for vendor lock-in
Reliance on third-party infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $23.3 million to EQUINIX GOVERNMENT SOLUTIONS LLC. CLOUD COMPUTING SERVICES

Who is the contractor on this award?

The obligated recipient is EQUINIX GOVERNMENT SOLUTIONS LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $23.3 million.

What is the period of performance?

Start: 2011-02-13. End: 2016-06-10.

What specific cloud services were procured, and how do they align with the VA's mission objectives?

The data indicates 'CLOUD COMPUTING SERVICES' under NAICS code '541519 - Other Computer Related Services'. While specific service details are not provided, these services likely support the VA's digital infrastructure, enabling the delivery of healthcare, benefits, and other services to veterans. Alignment would involve assessing how these cloud capabilities enhance data accessibility, system reliability, and the deployment of new technological solutions for veteran support.

What are the potential risks associated with relying on Equinix Government Solutions LLC for critical cloud infrastructure over a five-year period?

Key risks include vendor lock-in, where switching providers becomes costly and complex. Data security and privacy are paramount, requiring robust safeguards against breaches. Dependence on Equinix's infrastructure means any outages or performance issues on their end directly impact VA services. Furthermore, the long-term contract might limit the VA's ability to adopt newer, potentially more cost-effective or advanced cloud technologies if not structured with flexibility.

How effectively did the full and open competition process ensure value for money in this $23.3M cloud services contract?

The full and open competition method is designed to maximize value by allowing all eligible vendors to bid, fostering a competitive environment that typically drives down prices and improves service offerings. For this $23.3M contract, it suggests that multiple qualified providers likely competed, leading to a price and service package deemed most advantageous to the VA. However, true effectiveness is best measured by comparing the final price and service levels against industry benchmarks and the actual performance realized throughout the contract's life.

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

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Verizon Communications Inc (UEI: 107212169)

Address: 460 SPRINGPARK PL STE 1000, HERNDON, VA, 20170

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $89,996,604

Exercised Options: $65,757,387

Current Obligation: $23,299,610

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS35F0073U

IDV Type: FSS

Timeline