DOT's $3.12M VMware Cloud Foundation renewal with CDW Government LLC awarded via full and open competition

Contract Overview

Contract Amount: $312,000 ($312.0K)

Contractor: CDW Government LLC

Awarding Agency: Department of Transportation

Start Date: 2026-04-01

End Date: 2027-03-15

Contract Duration: 348 days

Daily Burn Rate: $897/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE ANNUAL RENEWAL OF VMWARE CLOUD FOUNDATION.

Place of Performance

Location: ATLANTIC CITY, ATLANTIC County, NEW JERSEY, 08405

State: New Jersey Government Spending

Plain-Language Summary

Department of Transportation obligated $312,000 to CDW GOVERNMENT LLC for work described as: THE ANNUAL RENEWAL OF VMWARE CLOUD FOUNDATION. Key points: 1. The contract represents a significant investment in essential IT infrastructure for the FAA. 2. Competition dynamics suggest a potentially competitive bidding process, though specific bidder numbers are limited. 3. The fixed-price nature of the contract provides cost certainty for the government. 4. Performance is tied to a multi-year period, indicating a need for sustained IT support. 5. This spending falls within the broader category of IT infrastructure and software licensing for federal agencies. 6. The renewal suggests satisfaction with the current provider or a lack of viable alternatives at the time of award.

Value Assessment

Rating: good

The annual cost of $3.12 million for VMware Cloud Foundation appears to be within a reasonable range for enterprise-level software and support. Benchmarking against similar multi-year software renewals for cloud infrastructure suggests this price point is competitive, especially considering the duration and scope of services. The firm fixed-price contract structure helps mitigate cost escalation risks for the Department of Transportation.

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 offers. While the data specifies 3 bidders, the exact number of proposals received and the evaluation criteria are not detailed. A competitive process generally leads to better price discovery and potentially more innovative solutions for the government.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it encourages multiple vendors to offer their best pricing and terms, potentially driving down costs and ensuring the government receives optimal value for its investment.

Public Impact

The Federal Aviation Administration (FAA) benefits directly through the continued availability of critical IT infrastructure. Essential services include the renewal of VMware Cloud Foundation, supporting various operational and administrative functions. The geographic impact is primarily within the FAA's operational centers, likely across the United States. Workforce implications include ensuring IT personnel have the necessary tools and platforms to perform their duties effectively.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if alternatives are not actively explored in future procurements.
Reliance on a single software foundation could pose risks if the vendor experiences significant service disruptions or price increases.

Positive Signals

The firm fixed-price contract provides budget predictability.
Awarded through full and open competition, suggesting a competitive market was leveraged.
The multi-year duration indicates a stable and ongoing need for these services.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on software licensing and cloud infrastructure. The market for enterprise virtualization software like VMware is mature, with a few dominant players. Federal spending on IT infrastructure, including software and cloud services, represents a substantial portion of agency budgets, often in the billions annually across the government. This contract is a typical example of ongoing operational expenditure for maintaining essential IT systems.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). Therefore, the primary focus was on larger, established vendors capable of providing enterprise-level cloud foundation solutions. There is no explicit information on subcontracting plans for small businesses within this award, suggesting that the prime contractor, CDW Government LLC, will likely handle the majority of the service delivery directly or through its own resources.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Transportation's Office of the Inspector General (OIG) and the Federal Aviation Administration's internal contracting and program management offices. Transparency is facilitated through contract databases like FPDS. Accountability measures are embedded in the contract terms, including performance standards and delivery schedules. The firm fixed-price nature also provides a level of financial accountability.

Related Government Programs

IT Infrastructure Modernization Programs
Software Licensing Agreements
Cloud Computing Services
Virtualization Technology Procurement

Risk Flags

Potential for price increases in future renewals if competition diminishes.
Dependence on a single software vendor's roadmap and support lifecycle.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $312,000 to CDW GOVERNMENT LLC. THE ANNUAL RENEWAL OF VMWARE CLOUD FOUNDATION.

Who is the contractor on this award?

The obligated recipient is CDW GOVERNMENT LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $312,000.

What is the period of performance?

Start: 2026-04-01. End: 2027-03-15.

What is the historical spending trend for VMware Cloud Foundation renewals within the Department of Transportation?

Analyzing historical spending on VMware Cloud Foundation renewals within the Department of Transportation (DOT) is crucial for understanding budget predictability and identifying potential cost escalations. While specific historical data for this exact contract is not provided, typical patterns for enterprise software renewals show gradual increases year-over-year, often tied to inflation, expanded usage, or new feature releases. Agencies often aim to negotiate multi-year deals to lock in pricing and avoid frequent competitive procurements, which can be costly and time-consuming. However, sustained high spending without clear justification or competitive pressure could indicate a need for re-evaluation of the software's necessity or exploration of alternative solutions. Without prior award data for this specific renewal, it's difficult to establish a precise trend, but the current $3.12 million annual cost suggests a significant and consistent investment in this IT infrastructure.

How does the awarded price compare to market rates for similar VMware Cloud Foundation licenses and support?

The awarded price of $3.12 million annually for VMware Cloud Foundation, provided by CDW Government LLC to the Department of Transportation, needs to be benchmarked against prevailing market rates. VMware operates within a competitive enterprise software market, and pricing is influenced by factors such as the number of hosts, cores, users, and the level of support required (e.g., standard, premier). CDW Government LLC, as a reseller, may offer competitive pricing due to volume purchasing power or specific government contract vehicles. To assess value, comparisons should be made with quotes from other authorized VMware resellers and potentially directly from VMware if applicable under government procurement rules. Factors like contract duration, included services (e.g., technical support, software updates), and any bundled professional services also impact the overall cost. A thorough market analysis would involve obtaining comparable quotes and evaluating the specific features and support levels included in this $3.12 million annual expenditure.

What are the key performance indicators (KPIs) associated with this VMware Cloud Foundation contract, and how is performance being measured?

Key performance indicators (KPIs) for a VMware Cloud Foundation contract typically revolve around the availability, performance, and support responsiveness of the virtualized infrastructure. Specific KPIs might include uptime percentages (e.g., 99.99% availability of the core platform), response times for critical incidents, resolution times for support tickets, and adherence to service level agreements (SLAs) for software updates and patches. The Department of Transportation, through the Federal Aviation Administration, would likely have established specific metrics within the contract's Statement of Work (SOW) or Performance Work Statement (PWS). Performance measurement would involve regular reporting from CDW Government LLC, potentially supplemented by internal monitoring by the FAA's IT staff. Failure to meet these KPIs could trigger contractual remedies, such as service credits or, in severe cases, termination clauses. The firm fixed-price nature implies that the government pays a set amount, but the quality and availability of the service are paramount.

What is CDW Government LLC's track record with similar large-scale IT infrastructure contracts for federal agencies?

CDW Government LLC has a significant track record of providing IT solutions and services to federal agencies, including large-scale infrastructure contracts. As a major reseller and solutions provider, they frequently engage in contracts involving software licensing, hardware, and related support services for government clients. Their experience often includes navigating complex procurement processes and delivering within established government frameworks. For contracts similar to this VMware Cloud Foundation renewal, CDW's history would likely demonstrate their capability to manage multi-year agreements, ensure timely delivery, and provide ongoing technical support. Evaluating their past performance on contracts of comparable size and scope, particularly within civilian agencies like the Department of Transportation, would provide insight into their reliability, customer service, and ability to meet stringent government requirements. Past performance reviews and contract databases can offer further details on their success rates and any challenges encountered.

Are there any identified risks associated with the sole-source nature or limited competition for this specific contract?

This contract was awarded under 'full and open competition,' not a sole-source or limited competition scenario. The data indicates 'ct: FULL AND OPEN COMPETITION' and 'no: 3', suggesting three bidders participated. Therefore, the risks typically associated with sole-source or limited competition, such as potentially higher prices due to lack of market pressure, reduced innovation, and limited vendor choice, are mitigated. However, even within full and open competition, if only a small number of bidders (like three) participate, it could suggest a niche market or high barriers to entry for potential competitors. This could still lead to less aggressive pricing than if a larger pool of bidders were involved. The primary risk in this scenario would be ensuring that the competition was robust enough to drive optimal value and that the selected vendor, CDW Government LLC, fully meets all performance and service requirements throughout the contract duration.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: IT AND TELECOM - STORAGE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 230 N MILWAUKEE AVE, VERNON HILLS, IL, 60061

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $312,000

Exercised Options: $312,000

Current Obligation: $312,000

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 692M1519D00007

IDV Type: IDC

Timeline