DOJ's FBI awarded $21.2M for Cisco Smartnet renewal, raising questions on value and competition

Contract Overview

Contract Amount: $21,179,266 ($21.2M)

Contractor: Pcmg, Inc.

Awarding Agency: Department of Justice

Start Date: 2013-03-29

End Date: 2014-03-31

Contract Duration: 367 days

Daily Burn Rate: $57.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: CISCO SMARTNET RENEWAL; IGF::OT::IGF

Place of Performance

Location: CHANTILLY, FAIRFAX County, VIRGINIA, 20151

State: Virginia Government Spending

Plain-Language Summary

Department of Justice obligated $21.2 million to PCMG, INC. for work described as: CISCO SMARTNET RENEWAL; IGF::OT::IGF Key points: 1. The contract's value appears high relative to its duration and the services provided. 2. Limited public information makes it difficult to assess the true market value. 3. The sole-source nature of the award warrants scrutiny regarding potential overpricing. 4. Performance context is minimal, lacking details on specific service levels or outcomes. 5. This contract falls within the IT services sector, specifically network maintenance. 6. The renewal suggests a reliance on a specific vendor, potentially limiting future cost savings.

Value Assessment

Rating: questionable

The awarded amount of $21.2 million for a 367-day contract for Cisco Smartnet renewal seems substantial. Without detailed service level agreements or performance metrics, it's challenging to benchmark the value effectively. Comparing this to similar IT maintenance contracts for large federal agencies would be necessary to determine if the pricing is competitive. The lack of competition further complicates a value assessment, as there was no market pressure to drive down costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning only one vendor was solicited. This approach significantly limits the opportunity for competitive bidding and price discovery. While sole-source awards can be justified in specific circumstances (e.g., unique capabilities, urgent needs), they often result in higher prices for the government compared to fully competed contracts. The absence of multiple bidders means the FBI did not benefit from a competitive market.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as there is no competitive pressure to ensure the best possible price. This limits the government's ability to secure favorable terms and potentially overpays for essential services.

Public Impact

The Federal Bureau of Investigation (FBI) is the primary beneficiary, ensuring continued network support. Essential IT infrastructure support services are delivered, maintaining operational continuity. The geographic impact is national, supporting FBI operations across its various locations. Workforce implications are indirect, focusing on maintaining the tools used by IT personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potentially increases costs.
Lack of detailed performance metrics makes value assessment difficult.
Renewal of existing support contracts can lead to vendor lock-in.
High dollar value for a single-year contract warrants scrutiny.

Positive Signals

Ensures continuity of critical IT network support for the FBI.
Cisco Smartnet is a widely recognized and utilized network support service.
Firm Fixed Price contract provides cost certainty for the government.

Sector Analysis

This contract falls within the Information Technology (IT) sector, specifically focusing on network maintenance and support services. The market for IT maintenance and support is large and competitive, with numerous vendors offering similar services. However, for specific hardware like Cisco equipment, specialized support contracts are often necessary. The FBI's spending on such services is typical for a large federal law enforcement agency requiring robust and reliable IT infrastructure.

Small Business Impact

There is no indication that this contract involved small business set-asides or subcontracting opportunities. As a sole-source award to a likely large IT service provider, the direct impact on the small business ecosystem is minimal. Future procurements could explore opportunities for small businesses to participate in broader IT support services or specialized components.

Oversight & Accountability

Oversight for this contract would typically fall under the FBI's contracting and program management offices. Transparency is limited due to the sole-source nature and lack of publicly available performance reports. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected. Standard contract administration processes would be in place to monitor compliance.

Related Government Programs

FBI IT Support Services
Network Maintenance Contracts
Cisco Equipment Support
Federal IT Infrastructure

Risk Flags

Data Inconsistency: 'FULL AND OPEN COMPETITION' listed alongside sole-source award.
Lack of Competition: Sole-source award limits price discovery and value.
Limited Transparency: Insufficient public data on performance and detailed scope.
Potential Overpricing: Sole-source awards can lead to higher costs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $21.2 million to PCMG, INC.. CISCO SMARTNET RENEWAL; IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is PCMG, INC..

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Bureau of Investigation).

What is the total obligated amount?

The obligated amount is $21.2 million.

What is the period of performance?

Start: 2013-03-29. End: 2014-03-31.

What is the track record of PCMG, INC. in providing similar IT support services to federal agencies?

Publicly available data on PCMG, INC.'s track record for providing IT support services, particularly for Cisco Smartnet renewals, is limited. As the sole-source awardee, their specific performance history on this particular contract is not readily accessible through standard federal procurement databases. Further investigation into contract performance reports or agency-specific evaluations would be required to assess their past performance comprehensively. Without this, it's difficult to gauge their reliability and effectiveness beyond the fact that they were awarded this renewal.

How does the $21.2 million cost compare to market rates for similar Cisco Smartnet support contracts?

Benchmarking the $21.2 million cost against market rates for similar Cisco Smartnet support contracts is challenging without more specific details about the scope of services, the number and type of devices covered, and the service level agreements (SLAs). However, given the sole-source nature of the award and the absence of competitive bidding, it is plausible that the price may be higher than what could be achieved through a competitive process. Industry averages for enterprise-level Cisco support can vary significantly, but a contract of this magnitude for a single year warrants a thorough cost analysis to ensure it aligns with fair market value.

What are the primary risks associated with a sole-source award for essential IT network support?

The primary risks associated with a sole-source award for essential IT network support include inflated pricing due to the lack of competition, potential for reduced service quality if the contractor faces no market pressure, and vendor lock-in, which can make it difficult and costly to switch providers in the future. There's also a risk that the government may not be receiving the most innovative or cost-effective solutions available in the market. For the FBI, ensuring uninterrupted network support is critical, making the reliance on a single, potentially non-competitively chosen vendor a strategic risk.

What specific IT services are covered under this Cisco Smartnet renewal contract?

The data provided indicates this is a 'CISCO SMARTNET RENEWAL,' suggesting the contract covers technical support, hardware replacement, and software updates for Cisco networking equipment. Cisco Smartnet is a comprehensive support service that typically includes 24/7 access to technical experts, advance hardware replacement, operating system software updates, and access to Cisco's online knowledge base. The exact scope would be detailed in the contract's statement of work (SOW), which is not publicly available, but it is understood to be maintenance and support for existing Cisco network infrastructure.

What is the historical spending pattern for Cisco Smartnet support at the FBI or DOJ?

Historical spending patterns for Cisco Smartnet support at the FBI or DOJ are not detailed in the provided data. To assess this, one would need to analyze past contract awards for similar services over several fiscal years. Understanding the trend in spending—whether it has increased, decreased, or remained stable—and the number of times these services have been renewed or recompeted would provide valuable context. This analysis could reveal patterns of sole-source reliance or opportunities for more competitive procurement strategies in the future.

Does the 'FULL AND OPEN COMPETITION' designation conflict with the sole-source award?

Yes, the provided data contains a contradiction. The 'ct' field is listed as 'FULL AND OPEN COMPETITION,' while the contract type is indicated as 'sole-source' in the analysis. This discrepancy needs clarification. If the contract was indeed awarded under full and open competition, it implies multiple bids were solicited and evaluated, which contradicts the definition of a sole-source award. If it was truly sole-source, the 'ct' field should reflect that, perhaps as 'Other Than Full and Open Competition' or a specific sole-source justification code. This inconsistency raises concerns about the accuracy of the procurement data.

Industry Classification

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

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

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: PC Mall, Inc (UEI: 181087842)

Address: 14120 NEWBROOK DR., STE. 100, CHANTILLY, VA, 90

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,179,266

Exercised Options: $21,179,266

Current Obligation: $21,179,266

Parent Contract

Parent Award PIID: NNG07DA08B

IDV Type: GWAC

Timeline