State Department Awards Palantir $6M for GCFS StateInsight Software
Contract Overview
Contract Amount: $6,007,220 ($6.0M)
Contractor: Palantir USG Inc
Awarding Agency: Department of State
Start Date: 2025-09-30
End Date: 2026-09-29
Contract Duration: 364 days
Daily Burn Rate: $16.5K/day
Competition Type: NOT COMPETED UNDER SAP
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: PALANTIR PROJECT - GCFS STATEINSIGHT
Place of Performance
Location: PALO ALTO, SANTA CLARA County, CALIFORNIA, 94301
Plain-Language Summary
Department of State obligated $6.0 million to PALANTIR USG INC for work described as: PALANTIR PROJECT - GCFS STATEINSIGHT Key points: 1. Significant contract value of $6.01M for specialized software. 2. Sole-source award to Palantir USG Inc. raises competition concerns. 3. Potential for high taxpayer impact due to lack of competitive bidding. 4. Software Publishers sector, with potential for high-value contracts.
Value Assessment
Rating: questionable
The contract value of $6.01M for GCFS StateInsight software is difficult to assess without comparable benchmarks. Given the sole-source nature, it's unclear if this price reflects market value or a premium.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed under SAP, indicating a sole-source award to Palantir USG Inc. This limits price discovery and potentially leads to higher costs for the government.
Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for this software, as there was no opportunity for multiple vendors to bid and drive down the price.
Public Impact
Citizens may not benefit from the most cost-effective solution due to the sole-source award. Transparency in government software procurement is reduced when contracts are not competed. The Department of State is investing significantly in data analytics capabilities.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for overpayment
Positive Signals
- Specific software solution for State Department needs
- Firm fixed price contract
Sector Analysis
The Software Publishers sector (NAICS 513210) is characterized by innovation and often high contract values for specialized solutions. This award aligns with the sector's potential for significant government spending on technology.
Small Business Impact
The contract was awarded to Palantir USG Inc., a large corporation, and there is no indication of small business involvement in this specific award. This represents a missed opportunity for small business participation.
Oversight & Accountability
The sole-source nature of this award warrants further oversight to ensure the price is fair and reasonable and that future procurements explore competitive options.
Related Government Programs
- Software Publishers
- Department of State Contracting
- Department of State Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Lack of transparency in procurement.
- Missed opportunity for small business participation.
- Dependency on a single vendor.
Tags
software-publishers, department-of-state, ca, bpa-call, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of State awarded $6.0 million to PALANTIR USG INC. PALANTIR PROJECT - GCFS STATEINSIGHT
Who is the contractor on this award?
The obligated recipient is PALANTIR USG INC.
Which agency awarded this contract?
Awarding agency: Department of State (Department of State).
What is the total obligated amount?
The obligated amount is $6.0 million.
What is the period of performance?
Start: 2025-09-30. End: 2026-09-29.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or proprietary technology. Without further details, it's difficult to ascertain the specific reasons. However, the government should have conducted a price analysis, potentially using historical data or independent cost estimates, to validate the $6.01M price against market rates for similar software solutions.
What are the risks associated with relying on a single vendor for critical software, especially in a sole-source scenario?
Sole-source contracts carry significant risks, including vendor lock-in, lack of innovation due to absent competition, and potential for inflated prices. If Palantir were to discontinue support or significantly increase prices, the Department of State would have limited options and potentially face disruption in critical operations.
How effective is the GCFS StateInsight software in meeting the Department of State's stated needs, and is this the most cost-effective solution available?
The effectiveness of the software is not detailed in the provided data. However, the lack of competition makes it challenging to definitively state if it's the most cost-effective solution. A competitive process would have allowed other vendors to demonstrate their capabilities and pricing, providing a clearer picture of value for taxpayer money.
Industry Classification
NAICS: Information › Software Publishers › Software Publishers
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: NOT COMPETED UNDER SAP
Solicitation Procedures: SIMPLIFIED ACQUISITION
Solicitation ID: 19AQMM25Q0062
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Palantir Technologies Inc.
Address: 635 WAVERLEY ST, PALO ALTO, CA, 94301
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $48,602,392
Exercised Options: $9,572,520
Current Obligation: $6,007,220
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 19AQMM25A1228
IDV Type: BPA
Timeline
Start Date: 2025-09-30
Current End Date: 2026-09-29
Potential End Date: 2030-09-29 00:00:00
Last Modified: 2026-03-25
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