DoD's $25.2M Microsoft Consulting Services Contract Awarded Sole-Source to Microsoft Corporation
Contract Overview
Contract Amount: $25,200,134 ($25.2M)
Contractor: Microsoft Corporation
Awarding Agency: Department of Defense
Start Date: 2013-09-26
End Date: 2016-09-28
Contract Duration: 1,098 days
Daily Burn Rate: $23.0K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IGF::CT::IGF - MICROSOFT CONSULTING SERVICES - LABOR
Place of Performance
Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $25.2 million to MICROSOFT CORPORATION for work described as: IGF::CT::IGF - MICROSOFT CONSULTING SERVICES - LABOR Key points: 1. Significant spending on IT consulting services for the Department of Defense. 2. Sole-source award to Microsoft Corporation raises questions about competition and potential overpricing. 3. Contract duration of 1098 days suggests a substantial, ongoing need for these services. 4. The 'Computer Systems Design Services' NAICS code indicates a focus on IT infrastructure and support.
Value Assessment
Rating: questionable
The contract's value of $25.2M for consulting services, awarded sole-source, suggests a lack of competitive pricing pressure. Without market benchmarks or competing bids, it's difficult to ascertain if this price represents fair market value for the services rendered.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, meaning no other vendors were considered. This significantly limits price discovery and competition, potentially leading to higher costs for the government.
Taxpayer Impact: The lack of competition in this sole-source award may result in taxpayers paying a premium for Microsoft's consulting services compared to what might be achieved through a competitive bidding process.
Public Impact
Taxpayers may be overpaying for IT consulting due to the absence of competitive bidding. The reliance on a single vendor for critical IT services could pose a long-term risk. Transparency in sole-source contract justifications is crucial for public trust. This contract highlights potential areas for improved procurement strategies within the DoD.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpricing
- Long contract duration
Positive Signals
- Specific vendor expertise
- Clear contract scope (implied)
Sector Analysis
This contract falls within the Information Technology sector, specifically Computer Systems Design Services. Benchmarks for IT consulting can vary widely, but sole-source awards often deviate from competitive market rates.
Small Business Impact
The contract was awarded directly to Microsoft Corporation, a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific award, missing an opportunity for small business participation.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the services provided are necessary, effectively delivered, and priced reasonably. Justification for the sole-source award should be thoroughly documented and publicly accessible.
Related Government Programs
- Computer Systems Design Services
- Department of Defense Contracting
- Defense Information Systems Agency Programs
Risk Flags
- Lack of competitive bidding
- Potential for inflated pricing
- Over-reliance on a single vendor
- Limited transparency in award justification
- Missed opportunity for small business engagement
Tags
computer-systems-design-services, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $25.2 million to MICROSOFT CORPORATION. IGF::CT::IGF - MICROSOFT CONSULTING SERVICES - LABOR
Who is the contractor on this award?
The obligated recipient is MICROSOFT CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $25.2 million.
What is the period of performance?
Start: 2013-09-26. End: 2016-09-28.
What was the specific justification for awarding this contract on a sole-source basis to Microsoft Corporation, and were alternative solutions or vendors considered?
The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or urgent needs where only one vendor can fulfill the requirement. For this contract, the specific rationale would need to be detailed in the contract's justification and approval (J&A) document. Without access to this document, it's impossible to confirm if alternatives were truly unavailable or if the government simply opted for the perceived ease of contracting with a known entity.
How does the per-unit cost or overall value of this contract compare to similar IT consulting services procured competitively by the DoD or other federal agencies?
Direct comparison is challenging without specific service details and market data. However, sole-source contracts inherently lack the price reduction typically achieved through competitive bidding. If similar services were procured competitively, it's probable that this contract's pricing is higher than the market average. A thorough cost-benefit analysis and benchmarking against competitively awarded contracts would be necessary to quantify the difference.
What mechanisms are in place to ensure the effectiveness and value for money of Microsoft's consulting services, given the sole-source nature of the award?
Effectiveness is typically managed through performance metrics, service level agreements (SLAs), and regular progress reviews outlined in the contract. For sole-source awards, robust oversight is even more critical. This includes detailed tracking of deliverables, independent validation of work performed, and ensuring that the services align precisely with the stated requirements and deliver tangible benefits to the agency.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: HC102813R0023
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: ONE MICROSOFT WAY, REDMOND, WA, 98052
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $25,200,134
Exercised Options: $25,200,134
Current Obligation: $25,200,134
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HC102813D0013
IDV Type: IDC
Timeline
Start Date: 2013-09-26
Current End Date: 2016-09-28
Potential End Date: 2016-09-28 00:00:00
Last Modified: 2020-09-09
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