Air Force Cloud One contract awarded to Leidos, Inc. for over $28.6 million to enhance cloud environments
Contract Overview
Contract Amount: $28,664,092 ($28.7M)
Contractor: Leidos, Inc.
Awarding Agency: Department of Defense
Start Date: 2025-12-10
End Date: 2031-05-09
Contract Duration: 1,976 days
Daily Burn Rate: $14.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 11
Pricing Type: TIME AND MATERIALS
Sector: IT
Official Description: OPERATE AND CONTINUALLY ENHANCE UNITED STATES AIR FORCE CLOUD ONE ENVIROMENT AND ENTERPRISE COMMON SHARED SERVICES.
Place of Performance
Location: HANSCOM AFB, MIDDLESEX County, MASSACHUSETTS, 01731
Plain-Language Summary
Department of Defense obligated $28.7 million to LEIDOS, INC. for work described as: OPERATE AND CONTINUALLY ENHANCE UNITED STATES AIR FORCE CLOUD ONE ENVIROMENT AND ENTERPRISE COMMON SHARED SERVICES. Key points: 1. Contract focuses on operating and enhancing the USAF Cloud One environment and enterprise common shared services. 2. The contract duration is substantial, spanning over 1900 days, indicating a long-term commitment to cloud services. 3. Awarded under full and open competition, suggesting a robust bidding process. 4. The contract type is Time and Materials, which can pose cost control challenges if not managed diligently. 5. This award represents a significant investment in the Air Force's cloud infrastructure modernization efforts. 6. The scope includes enterprise-wide shared services, implying a broad impact across various Air Force operations.
Value Assessment
Rating: good
Benchmarking the value of this specific contract is challenging without detailed service level agreements and performance metrics. However, the total value of over $28.6 million over its multi-year duration suggests a significant investment in critical IT infrastructure. The Time and Materials pricing model, while flexible, requires careful oversight to ensure cost-effectiveness compared to fixed-price alternatives for similar cloud services. Further analysis would require comparing the specific services delivered against industry standards and the pricing structure against comparable government or commercial cloud support contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 11 bids suggests a competitive landscape for this type of service. A competitive process generally leads to better price discovery and potentially more favorable terms for the government. The specific details of the bidding process, such as the number of responsive bids and the evaluation criteria, would provide further insight into the effectiveness of the competition.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down costs through market forces and encourages innovation among contractors, ultimately leading to better value for public funds.
Public Impact
The primary beneficiaries are the United States Air Force personnel and operations that rely on the Cloud One environment for mission-critical functions. The contract delivers essential IT services for operating and enhancing cloud infrastructure, ensuring continuity and modernization. The geographic impact is enterprise-wide across the Air Force, supporting its digital transformation initiatives. Workforce implications include the potential for specialized IT roles within Leidos, Inc. to support the contract, and the impact on Air Force IT personnel who will utilize the enhanced cloud services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time and Materials contract type can lead to cost overruns if not closely monitored.
- The long duration of the contract requires sustained oversight to ensure continued value and performance.
- Dependence on a single contractor for critical cloud infrastructure could pose a risk if performance degrades.
Positive Signals
- Awarded under full and open competition, indicating a competitive process.
- The contract aims to enhance and operate a critical Air Force cloud environment, supporting modernization.
- The substantial value suggests a significant commitment to improving IT capabilities.
Sector Analysis
This contract falls within the broader IT services sector, specifically focusing on cloud computing and managed IT services. The market for government cloud services is substantial and growing, driven by agencies seeking to modernize infrastructure, improve agility, and reduce costs. Leidos, Inc. is a major player in this space, competing with numerous other large and small businesses. Comparable spending benchmarks would involve analyzing other large-scale cloud managed services contracts awarded by the Department of Defense and other federal agencies.
Small Business Impact
The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). As a large contract awarded under full and open competition, there may be opportunities for small businesses to participate as subcontractors to Leidos, Inc. However, the primary awardee is a large business, and the direct impact on the small business ecosystem through set-asides is absent in this specific award.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Air Force contracting and program management offices. Accountability measures would be defined in the contract's performance work statement (PWS) and service level agreements (SLAs). Transparency is typically facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Air Force Cloud Computing Program
- DoD Enterprise Cloud Strategy
- IT Infrastructure Modernization Programs
- Common Shared Services Initiatives
Risk Flags
- Time and Materials Pricing
- Broad NAICS Code Classification
- Long Contract Duration
Tags
it, defense, air-force, cloud-computing, managed-services, full-and-open-competition, time-and-materials, large-contract, enterprise-it, it-modernization, leidos-inc
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $28.7 million to LEIDOS, INC.. OPERATE AND CONTINUALLY ENHANCE UNITED STATES AIR FORCE CLOUD ONE ENVIROMENT AND ENTERPRISE COMMON SHARED SERVICES.
Who is the contractor on this award?
The obligated recipient is LEIDOS, INC..
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 $28.7 million.
What is the period of performance?
Start: 2025-12-10. End: 2031-05-09.
What is the historical spending pattern for similar cloud services contracts by the Air Force or DoD?
Analyzing historical spending on cloud services by the Air Force and the broader Department of Defense reveals a significant and increasing trend. Agencies are actively migrating workloads to cloud environments to leverage scalability, flexibility, and cost efficiencies. Contracts for cloud infrastructure, platform, and software services, as well as managed services for these environments, have seen substantial growth over the past decade. For instance, the DoD's overall IT budget includes billions allocated annually to cloud initiatives. Specific contract vehicles like the General Services Administration's (GSA) Cloud Information Technology Services (CITS) blanket purchase agreement and various agency-specific cloud contracts demonstrate this trend. The 'Cloud One' program itself represents a consolidation and enhancement effort, building upon previous investments in cloud adoption. Understanding these patterns helps contextualize the $28.6 million award as part of a larger, ongoing strategic shift towards cloud-native operations within the Air Force.
How does the pricing structure (Time and Materials) compare to other contract types for similar cloud services?
The Time and Materials (T&M) contract type, used here, allows the government to pay the contractor for direct labor hours at specified hourly rates and for actual material costs. While offering flexibility, especially for requirements that are not well-defined upfront or are expected to evolve, T&M contracts carry a higher risk of cost overruns compared to fixed-price contracts. For cloud services, where scope can sometimes be predictable (e.g., managed services for a defined environment), fixed-price or cost-plus-fixed-fee structures might offer better cost certainty. However, for complex enhancement and operational tasks where the exact effort is difficult to estimate, T&M can be appropriate if coupled with stringent oversight, labor hour ceilings, and clear performance metrics to control costs. Benchmarking would involve comparing the negotiated hourly rates for labor categories and the overhead/G&A rates against similar T&M contracts for IT services or against industry commercial rates for comparable cloud support.
What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract?
The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for a contract focused on operating and enhancing a cloud environment like Cloud One, typical KPIs would likely include metrics related to system availability (uptime), performance (latency, throughput), security compliance (vulnerability remediation times, audit success rates), incident response times, disaster recovery capabilities, and user satisfaction. SLAs would define the acceptable thresholds for these KPIs and the remedies or penalties if they are not met. The effectiveness and value-for-money of this $28.6 million contract are heavily dependent on the rigor and enforceability of these underlying performance standards, which are crucial for ensuring the Air Force receives the expected level of service and operational resilience.
What is Leidos, Inc.'s track record with similar large-scale cloud infrastructure contracts for the federal government?
Leidos, Inc. has a significant track record in providing large-scale IT services, including cloud solutions, to the federal government. They have been involved in numerous complex IT modernization efforts across various agencies, including defense and civilian. Their experience encompasses cloud migration, managed cloud services, cybersecurity, and enterprise IT infrastructure support. For example, Leidos has held contracts related to enterprise resource planning (ERP) systems, data center consolidation, and network modernization, many of which involve cloud components or integration. Their past performance on similar contracts, including their ability to manage large budgets, complex technical requirements, and stringent security protocols, would have been a key factor in the Air Force's decision-making process for the Cloud One contract. Assessing their specific performance on prior cloud-related awards would provide further insight into their capabilities and reliability.
What are the potential risks associated with the 'Other Computer Related Services' (NAICS 541519) classification for this contract?
The NAICS code 541519, 'Other Computer Related Services,' is a broad category that encompasses a wide range of IT services not specified elsewhere. While it allows for flexibility in service delivery, it can also present risks if the scope of work is not clearly defined. For this contract, which focuses on operating and enhancing a cloud environment, the 'other' classification might imply services beyond standard cloud hosting, potentially including custom software development, integration services, or specialized IT consulting. The risk lies in potential scope creep, misinterpretation of requirements, and difficulties in performance measurement if the specific deliverables are not meticulously detailed in the Performance Work Statement (PWS). Ensuring clear definitions, robust oversight, and alignment with specific Air Force cloud strategy objectives are critical to mitigating risks associated with this broad classification.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 11
Pricing Type: TIME AND MATERIALS (Y)
Evaluated Preference: NONE
Contractor Details
Address: 1750 PRESIDENTS ST 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: $454,954,000
Exercised Options: $44,175,387
Current Obligation: $28,664,092
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Parent Contract
Parent Award PIID: 47QTCA25D008B
IDV Type: FSS
Timeline
Start Date: 2025-12-10
Current End Date: 2031-05-09
Potential End Date: 2031-05-09 00:00:00
Last Modified: 2025-12-18
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