DoD's $684M Common Computing Environment contract awarded to SAIC shows strong competition and long-term performance

Contract Overview

Contract Amount: $684,030,647 ($684.0M)

Contractor: Science Applications International Corporation

Awarding Agency: Department of Defense

Start Date: 2019-09-10

End Date: 2025-09-07

Contract Duration: 2,189 days

Daily Burn Rate: $312.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: COMMON COMPUTING ENVIRONMENT (CCE) FOLLOW-ON

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $684.0 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION for work described as: COMMON COMPUTING ENVIRONMENT (CCE) FOLLOW-ON Key points: 1. Value for money appears favorable given the firm-fixed-price structure and long-term nature of the contract. 2. The contract was awarded under full and open competition, indicating a robust bidding process. 3. Risk indicators are moderate, with a long performance period and a single awardee potentially posing some concentration risk. 4. Performance context suggests a critical IT infrastructure support role within the Department of the Air Force. 5. Sector positioning is within IT services, specifically computer systems design, a large and competitive market.

Value Assessment

Rating: good

The contract's total value of approximately $684 million over its duration suggests a significant investment in IT infrastructure. While direct comparisons are difficult without specific service breakdowns, the firm-fixed-price (FFP) award type generally indicates a commitment to cost control by the government. The long duration (over 5 years) implies a stable, ongoing need for these services. Benchmarking against similar large-scale IT support contracts would be necessary for a more precise value assessment, but the competitive award process provides a baseline for fair pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The presence of four bids indicates a healthy level of competition for this significant IT services requirement. A competitive process like this generally leads to better price discovery and ensures the government receives offers from a range of qualified vendors, potentially driving down costs and improving service quality.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are being used efficiently by leveraging market forces to secure the best possible value for these essential computing environment services.

Public Impact

The Department of the Air Force benefits from reliable and comprehensive IT support services. End-users within the Air Force receive consistent access to critical computing resources and systems. The contract supports the operational readiness and technological infrastructure of a major military branch. Workforce implications include the potential for sustained employment for IT professionals supporting the contract, primarily in Virginia.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on a single awardee for a critical function may pose risks if the contractor faces financial or operational difficulties.
Scope creep could increase costs if not rigorously managed under the FFP structure.

Positive Signals

Firm-fixed-price contract structure provides cost certainty for the government.
Awarded under full and open competition, suggesting a competitive pricing environment.
Long-term nature allows for stable planning and execution of IT services.
Contractor (SAIC) is a large, established entity with significant experience in government contracting.

Sector Analysis

The IT services sector, particularly computer systems design, is a vast and dynamic market. This contract falls within the government's significant spending on IT infrastructure and support, which is crucial for modern defense operations. Comparable spending benchmarks for large-scale IT support contracts within the federal government often run into hundreds of millions of dollars, reflecting the complexity and scale of these requirements. The market is characterized by a mix of large system integrators and specialized service providers.

Small Business Impact

This contract does not appear to have specific small business set-aside provisions, nor is there an indication of significant subcontracting opportunities for small businesses based on the provided data. The primary awardee, Science Applications International Corporation (SAIC), is a large business. Further analysis of subcontracting plans would be needed to determine the extent of small business participation and its impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program management office within the Department of the Air Force. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified services. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Common Computing Environment (CCE)
IT Infrastructure Support Services
Department of Defense IT Modernization Programs
Air Force Network Operations
Cloud Computing Services Contracts

Risk Flags

Long contract duration may limit flexibility.
Single awardee concentration risk.
Potential for scope creep if not managed.
Dependence on contractor's cybersecurity posture.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $684.0 million to SCIENCE APPLICATIONS INTERNATIONAL CORPORATION. COMMON COMPUTING ENVIRONMENT (CCE) FOLLOW-ON

Who is the contractor on this award?

The obligated recipient is SCIENCE APPLICATIONS INTERNATIONAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $684.0 million.

What is the period of performance?

Start: 2019-09-10. End: 2025-09-07.

What is Science Applications International Corporation's (SAIC) track record with large federal IT contracts, particularly within the Department of Defense?

SAIC has a long and extensive history of performing large-scale IT services contracts for the Department of Defense and other federal agencies. They are a major government contractor known for their capabilities in areas such as systems engineering, software development, cybersecurity, and IT infrastructure management. Their track record includes numerous prime contracts, often valued in the hundreds of millions or even billions of dollars, supporting complex defense systems and operations. While specific performance metrics for individual contracts are not publicly detailed, SAIC's continued success in winning competitive bids for significant programs like the Common Computing Environment (CCE) Follow-On indicates a generally positive performance history and strong client relationships within the DoD.

How does the pricing structure (firm-fixed-price) of this contract compare to other similar large-scale IT support contracts awarded by the DoD?

The firm-fixed-price (FFP) structure for this $684 million Common Computing Environment (CCE) contract is a common and often preferred pricing model for IT support services within the DoD, especially for well-defined requirements. FFP contracts shift most of the risk to the contractor, providing the government with cost certainty. Compared to other large IT support contracts, FFP is frequently used for services where the scope of work is clearly delineated and unlikely to change significantly. While other contracts might utilize cost-plus or time-and-materials structures for more research-oriented or evolving needs, FFP is generally seen as a benchmark for cost control when the government knows precisely what it needs and can define it upfront. This structure aims to ensure value by fixing the price regardless of the contractor's actual costs.

What are the primary risks associated with a single award, long-duration contract like this for critical IT infrastructure?

A single award, long-duration contract for critical IT infrastructure, such as the CCE Follow-On, presents several key risks. Firstly, there's the risk of contractor dependency or 'vendor lock-in,' where the government becomes heavily reliant on one provider, potentially limiting future flexibility or innovation. Secondly, if the sole awardee experiences financial instability, operational failures, or strategic shifts, it could severely disrupt essential services, as there are no immediate backup providers. Thirdly, the lack of ongoing competition throughout the contract's life might reduce the incentive for the contractor to continually optimize performance or reduce costs beyond the initial bid, although contract management and performance reviews aim to mitigate this. Finally, if the contractor's performance degrades, the process of re-competing or switching providers is lengthy and costly, leaving the government potentially stuck with suboptimal service for an extended period.

How does the $684 million total value of this contract align with historical spending on similar computing environment services within the Air Force or DoD?

The total value of approximately $684 million for the Common Computing Environment (CCE) Follow-On contract aligns with historical spending patterns for large-scale, long-term IT infrastructure and support services within the Department of Defense, particularly the Air Force. Major commands frequently award contracts in the hundreds of millions of dollars for enterprise-wide IT solutions that encompass hardware, software, network management, and user support over multi-year periods. For instance, previous iterations of CCE or similar foundational IT programs have historically commanded significant budgets. This figure is not an outlier but rather representative of the substantial investment required to maintain and modernize the complex digital backbone supporting military operations, reflecting the scale and criticality of these services.

What are the potential implications for cybersecurity given the long-term nature and critical function of this contract?

The long-term nature and critical function of this contract have significant cybersecurity implications. As the primary provider for the Common Computing Environment, SAIC is entrusted with managing and securing the foundational IT infrastructure for a substantial portion of the Air Force's operations. This necessitates robust cybersecurity protocols, continuous monitoring, and adherence to stringent DoD security standards (e.g., RMF, NIST). The long duration means that the cybersecurity landscape will evolve considerably over the contract's life, requiring SAIC to adapt its defenses against emerging threats. The government must ensure that contract terms include provisions for regular security audits, vulnerability assessments, and rapid incident response, as well as mandates for updating security measures to counter new cyber risks. A breach within this environment could have severe operational and national security consequences.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12010 SUNSET HILLS RD FL 4, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $724,406,266

Exercised Options: $724,406,266

Current Obligation: $684,030,647

Actual Outlays: $25,195,923

Subaward Activity

Number of Subawards: 336

Total Subaward Amount: $221,320,184

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: 47QTCK18D0001

IDV Type: GWAC

Timeline