DOJ Spends $13.4M on IBM Software Licenses for Data Centers via Non-Competitive Order
Contract Overview
Contract Amount: $13,436,213 ($13.4M)
Contractor: International Business Machines Corporation
Awarding Agency: Department of Justice
Start Date: 2008-05-01
End Date: 2012-09-30
Contract Duration: 1,613 days
Daily Burn Rate: $8.3K/day
Competition Type: NON-COMPETITIVE DELIVERY ORDER
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: SOFTWARE LICENSE/MAINTENANCE FOR DOJ DATA CENTERS
Place of Performance
Location: ROCKVILLE, MONTGOMERY County, MARYLAND, 20850
State: Maryland Government Spending
Plain-Language Summary
Department of Justice obligated $13.4 million to INTERNATIONAL BUSINESS MACHINES CORPORATION for work described as: SOFTWARE LICENSE/MAINTENANCE FOR DOJ DATA CENTERS Key points: 1. Significant expenditure on software licenses and maintenance for critical DOJ data centers. 2. Sole reliance on IBM suggests potential vendor lock-in and limited market alternatives. 3. Long-term contract duration (over 4 years) raises concerns about price escalation and evolving technology needs. 4. The non-competitive nature of the award warrants scrutiny regarding fair pricing and value for taxpayer money.
Value Assessment
Rating: questionable
The contract value of $13.4M over four years for software licenses and maintenance is substantial. Without comparable contract data or detailed cost breakdowns, it's difficult to definitively assess if this represents excellent value. The non-competitive nature further complicates a fair pricing assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was awarded as a non-competitive delivery order, indicating a sole-source or limited competition scenario. This method bypasses the typical competitive bidding process, potentially leading to higher prices and reduced incentive for the vendor to offer the most cost-effective solution.
Taxpayer Impact: The lack of competition may result in taxpayers paying a premium for these software licenses and maintenance services, as there was no market pressure to drive down costs.
Public Impact
Ensures continued operation of essential DOJ data centers, supporting critical law enforcement and justice functions. Reliance on a single vendor (IBM) may limit flexibility and innovation in data center software solutions. Potential for cost overruns due to the non-competitive award and long contract duration. Impacts the ability of other software vendors to compete for this significant government contract.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Non-competitive award
- Long contract duration
- Sole reliance on one vendor
- Lack of detailed cost justification
Positive Signals
- Supports critical DOJ data center operations
- Utilizes established IBM software
Sector Analysis
This contract falls within the IT sector, specifically software licensing and maintenance. Government spending on enterprise software for data centers is substantial, with benchmarks varying widely based on software type, vendor, and contract structure. Non-competitive awards in this space often face increased scrutiny.
Small Business Impact
The data indicates this contract was awarded to a large corporation (IBM) and does not show any specific provisions or set-asides for small businesses. The non-competitive nature further suggests that small businesses were likely not considered or given an opportunity to participate in this procurement.
Oversight & Accountability
The non-competitive nature of this award warrants close oversight to ensure the Department of Justice received fair pricing and adequate services. A review of the justification for the sole-source award and subsequent performance monitoring would be crucial for accountability.
Related Government Programs
- Computer and Software Stores
- Department of Justice Contracting
- Offices, Boards and Divisions Programs
Risk Flags
- Potential for overpayment due to non-competitive award.
- Risk of vendor lock-in and limited future flexibility.
- Lack of transparency in pricing and justification.
- Software may become outdated over the contract's duration.
- Missed opportunity to foster competition and innovation.
Tags
computer-and-software-stores, department-of-justice, md, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Justice awarded $13.4 million to INTERNATIONAL BUSINESS MACHINES CORPORATION. SOFTWARE LICENSE/MAINTENANCE FOR DOJ DATA CENTERS
Who is the contractor on this award?
The obligated recipient is INTERNATIONAL BUSINESS MACHINES CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Justice (Offices, Boards and Divisions).
What is the total obligated amount?
The obligated amount is $13.4 million.
What is the period of performance?
Start: 2008-05-01. End: 2012-09-30.
What was the specific justification for awarding this contract non-competitively, and were alternatives explored?
The justification for a non-competitive award is critical for understanding why IBM was the sole provider. Agencies must typically demonstrate that only one source can meet the requirement due to unique capabilities or urgency. Exploring alternatives, even if ultimately deemed unsuitable, is usually part of the justification process to ensure fair market value was considered.
How does the per-unit cost of these IBM software licenses and maintenance compare to industry benchmarks for similar government contracts?
Without specific details on the software products and quantities, a direct per-unit cost comparison is challenging. However, given the non-competitive nature, there's a heightened risk that the pricing may exceed market rates. Benchmarking against other government contracts for similar IBM software, if available, would be essential to assess value for money.
What mechanisms were in place to ensure the effectiveness and continued relevance of the licensed software throughout the contract's four-year duration?
Effective oversight would involve tracking software performance, ensuring vendor support met service level agreements, and monitoring for obsolescence. Given the long term, the DOJ should have had processes to ensure the software remained functional and aligned with evolving technological needs, potentially through contract modifications or reviews.
Industry Classification
NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: NON-COMPETITIVE DELIVERY ORDER
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6710 ROCKLEDGE DR, BETHESDA, MD, 20817
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $38,468,035
Exercised Options: $17,874,739
Current Obligation: $13,436,213
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Parent Contract
Parent Award PIID: GS35F4984H
IDV Type: FSS
Timeline
Start Date: 2008-05-01
Current End Date: 2012-09-30
Potential End Date: 2012-09-30 00:00:00
Last Modified: 2021-12-02
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