DoD's $20.75M HP Server Services Contract Awarded to HP, Inc. Under Full and Open Competition
Contract Overview
Contract Amount: $20,752,646 ($20.8M)
Contractor: HP, Inc.
Awarding Agency: Department of Defense
Start Date: 2008-10-01
End Date: 2010-07-15
Contract Duration: 652 days
Daily Burn Rate: $31.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COMBINATION (TWO OR MORE)
Sector: IT
Official Description: HP CAPACITY SERVER SERVICES
Place of Performance
Location: PALO ALTO, SANTA CLARA County, CALIFORNIA, 94304
Plain-Language Summary
Department of Defense obligated $20.8 million to HP, INC. for work described as: HP CAPACITY SERVER SERVICES Key points: 1. The contract awarded to HP, Inc. for server services represents a significant investment by the Department of Defense. 2. Competition was full and open, suggesting a robust price discovery process. 3. The contract's duration and value warrant scrutiny for potential cost efficiencies and performance. 4. The sector is IT services, specifically 'Other Computer Related Services'.
Value Assessment
Rating: fair
The contract value of $20.75M over approximately two years suggests a moderate annual spend. Benchmarking against similar IT service contracts would be necessary to fully assess pricing fairness.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically leads to competitive pricing. The award method 'AW' (Award) and 'DO' (Delivery Order) indicate a structured procurement process.
Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down costs through market forces, though the final price relative to market value needs further analysis.
Public Impact
Ensures critical IT infrastructure support for the Department of Defense. Potential for technology refresh and service improvements through competitive bidding. Supports the operational readiness of defense information systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of specific performance metrics in provided data.
- Potential for vendor lock-in if not managed carefully.
- Need to verify if pricing reflects current market rates for server services.
Positive Signals
- Awarded under full and open competition.
- Supports a critical government function (Defense Information Systems Agency).
Sector Analysis
This contract falls within the IT services sector, specifically 'Other Computer Related Services'. Spending benchmarks for similar government IT service contracts would provide context for the $20.75M award.
Small Business Impact
The provided data does not indicate any specific set-asides for small businesses. The contract was awarded to HP, Inc., a large corporation, suggesting limited direct impact on small businesses unless they are subcontractors.
Oversight & Accountability
Oversight would typically be managed by the Defense Information Systems Agency (DISA) through contract performance monitoring and reporting. Accountability rests with DISA to ensure service delivery and value for money.
Related Government Programs
- Other Computer Related Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Potential for cost overruns if not closely managed.
- Risk of service obsolescence if technology evolves rapidly.
- Dependence on a single vendor (HP, Inc.) for critical services.
- Need for detailed performance metrics to ensure value.
Tags
other-computer-related-services, department-of-defense, ca, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $20.8 million to HP, INC.. HP CAPACITY SERVER SERVICES
Who is the contractor on this award?
The obligated recipient is HP, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $20.8 million.
What is the period of performance?
Start: 2008-10-01. End: 2010-07-15.
What specific server services are covered under this contract, and how do they align with DISA's current and future IT infrastructure needs?
The provided data categorizes the service as 'Other Computer Related Services' (NAICS 541519). A detailed analysis would require reviewing the contract's Statement of Work (SOW) to understand the scope, including hardware maintenance, software support, and potential cloud integration. This alignment is crucial for ensuring the services remain relevant and cost-effective as DISA's technological landscape evolves.
How does the awarded price of $20.75M compare to industry benchmarks for similar HP server capacity services over a 652-day period?
Benchmarking requires comparing the contract's unit pricing and total value against publicly available data for comparable HP server services procured by other government agencies or large commercial entities. Factors like service level agreements (SLAs), hardware models, and support tiers significantly influence pricing. Without specific service details and comparable contract data, a definitive assessment of value for money is challenging.
What mechanisms are in place to ensure ongoing cost-effectiveness and performance optimization throughout the contract's lifecycle?
Effective contract management by DISA would involve regular performance reviews, service level agreement (SLA) adherence checks, and potentially periodic renegotiations based on market shifts or evolving requirements. Mechanisms like incentive clauses for exceeding performance targets or penalties for deficiencies can drive optimization. Transparency in reporting and a clear process for addressing any performance gaps are vital for taxpayer accountability.
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: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: HC101306R2000
Offers Received: 4
Pricing Type: COMBINATION (TWO OR MORE) (2)
Evaluated Preference: NONE
Contractor Details
Address: 3000 HANOVER ST, PALO ALTO, CA, 90
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $20,752,646
Exercised Options: $20,752,646
Current Obligation: $20,752,646
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC101307D2004
IDV Type: IDC
Timeline
Start Date: 2008-10-01
Current End Date: 2010-07-15
Potential End Date: 2010-07-15 00:00:00
Last Modified: 2010-09-21
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