GSA's $17.2M IT contract with CRAY INC. for computer manufacturing shows a competitive history

Contract Overview

Contract Amount: $17,199,840 ($17.2M)

Contractor: Cray Inc.

Awarding Agency: General Services Administration

Start Date: 2006-12-21

End Date: 2008-12-23

Contract Duration: 733 days

Daily Burn Rate: $23.5K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IT RELATED

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22201

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $17.2 million to CRAY INC. for work described as: IT RELATED Key points: 1. The contract was awarded through a competitive delivery order, indicating a degree of market vetting. 2. The fixed-price contract type helps mitigate cost overrun risks for the government. 3. The duration of the contract (733 days) suggests a moderate-term need for the specified IT goods. 4. The North American Industry Classification System (NAICS) code 334111 points to the electronic computer manufacturing sector. 5. The contract's value is relatively modest within the broader federal IT spending landscape. 6. The absence of small business set-asides warrants further investigation into subcontracting opportunities.

Value Assessment

Rating: fair

Benchmarking the value of this specific $17.2 million contract is challenging without more granular data on the exact computer systems procured and their specifications. However, given the duration and the nature of IT hardware, the price appears within a reasonable range for specialized equipment. Comparing it to similar large-scale computer manufacturing contracts awarded by GSA or other agencies would provide a clearer picture of value for money. The firm fixed-price structure is a positive indicator for cost control.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, suggesting that multiple vendors had the opportunity to bid. The presence of 4 bids indicates a reasonable level of competition for this specific requirement. A competitive process generally leads to better price discovery and ensures that the government is obtaining services or goods at market-reflective rates. The specific details of the bidding process and the number of bidders are crucial for a full assessment.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

Federal agencies requiring electronic computer manufacturing capabilities benefit from this contract. The contract supports the operational needs of government entities reliant on advanced computing hardware. The geographic impact is primarily within the United States, where the federal agencies are located. The contract supports jobs within the electronic computer manufacturing sector, including those at CRAY INC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of explicit small business subcontracting goals may limit opportunities for smaller firms.
The specific performance metrics and quality assurance measures are not detailed, posing potential oversight challenges.

Positive Signals

Awarded through a competitive process, suggesting fair market pricing.
Firm fixed-price contract type provides cost certainty.
The contractor, CRAY INC., is a known entity in the high-performance computing market.

Sector Analysis

This contract falls within the IT sector, specifically electronic computer manufacturing. The federal government is a significant purchaser of IT hardware, with annual spending in the hundreds of billions. Contracts like this, for specialized computing equipment, are crucial for agencies with high-performance computing needs, such as research, simulation, and data analysis. Benchmarking against other large-scale IT hardware procurements would place this contract's value in context.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (sb: false). Without explicit subcontracting plans or goals, it is difficult to assess the direct impact on the small business ecosystem. Further review of the contract's terms and conditions would be necessary to determine if any subcontracting opportunities were mandated or encouraged for small businesses.

Oversight & Accountability

The General Services Administration (GSA) typically has robust oversight mechanisms for its contracts, including performance monitoring and compliance checks. As a competitive delivery order, it likely falls under standard GSA procurement regulations. Transparency would be enhanced by public access to detailed performance reports and any post-award reviews conducted by GSA's Federal Acquisition Service or relevant Inspector General.

Related Government Programs

Federal Civilian IT Procurement
High-Performance Computing Contracts
GSA IT Schedule Contracts
Electronic Computer Manufacturing Services

Risk Flags

Potential for vendor lock-in with specialized hardware
Need for clarity on specific performance metrics and SLAs
Limited visibility into small business subcontracting utilization

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $17.2 million to CRAY INC.. IT RELATED

Who is the contractor on this award?

The obligated recipient is CRAY INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $17.2 million.

What is the period of performance?

Start: 2006-12-21. End: 2008-12-23.

What specific types of electronic computers were procured under this contract, and what were their key technical specifications?

The provided data identifies the NAICS code as 334111 (Electronic Computer Manufacturing) and the contractor as CRAY INC., a company known for supercomputers and high-performance computing (HPC) systems. While the exact models and specifications are not detailed in the summary data, it is highly probable that the contract involved the procurement of specialized, high-end computing hardware rather than standard desktop or laptop computers. CRAY INC.'s product lines typically include massively parallel processing systems designed for complex scientific and engineering simulations, large-scale data analytics, and artificial intelligence workloads. The $17.2 million value and the 733-day duration suggest a significant investment in advanced computing infrastructure.

How does the $17.2 million contract value compare to historical spending on similar IT hardware by the General Services Administration?

Comparing this $17.2 million contract to GSA's historical spending requires access to GSA's comprehensive procurement databases and analysis tools. GSA manages a vast array of IT contracts, and individual contract values can vary significantly based on the type of hardware, quantity, and duration. For specialized HPC systems from a vendor like CRAY INC., $17.2 million over two years represents a substantial, but not necessarily outlier, investment. GSA's overall IT spending runs into billions annually across numerous categories. To provide a precise comparison, one would need to analyze GSA's spending trends for supercomputing or high-performance computing solutions over the period of this contract and subsequent years, looking at average contract values and total spending in this niche.

What were the primary risks associated with this contract, and how were they mitigated?

Key risks for a contract involving specialized IT hardware like supercomputers include technological obsolescence, performance shortfalls, integration challenges, and cost overruns. The mitigation strategies employed here likely included the firm fixed-price (FFP) contract type, which shifts cost risk to the contractor, CRAY INC. The competitive award process (4 bidders) also helps ensure that the price reflects market conditions, reducing the risk of overpayment. Furthermore, GSA's standard procurement processes typically involve technical reviews and acceptance testing to ensure the delivered hardware meets specifications, mitigating performance and integration risks. The contract duration of 733 days also suggests a defined scope, limiting the window for potential issues.

What is the track record of CRAY INC. as a federal contractor, particularly with the General Services Administration?

CRAY INC. has a long-standing history as a provider of high-performance computing solutions to government agencies, including the federal government. Their track record typically involves delivering complex, mission-critical systems for scientific research, defense, and intelligence applications. As a federal contractor, CRAY INC. has likely been awarded numerous contracts through various procurement vehicles, including GSA schedules and direct solicitations. Their performance history would generally be characterized by the successful delivery of advanced computing capabilities, though like any large technology vendor, specific contract performance can vary. GSA's Federal Acquisition Service, which awarded this delivery order, would have records of CRAY's past performance on similar contracts.

What does the 'Federal Acquisition Service' designation imply about the nature and oversight of this contract?

The 'Federal Acquisition Service' (FAS) is a major component of the General Services Administration (GSA) responsible for providing a wide range of goods and services to federal agencies. When a contract is awarded through FAS, it implies that the procurement likely utilized GSA's established contract vehicles, such as Multiple Award Schedules (MAS) or GWACs (Government-Wide Acquisition Contracts), or was managed under GSA's centralized procurement expertise. This designation suggests that the contract adheres to GSA's rigorous acquisition policies and procedures, which are designed to ensure fair and open competition, reasonable pricing, and compliance with federal procurement regulations. Oversight would be managed by GSA contracting officers and program managers, with potential review by the GSA Inspector General.

Industry Classification

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

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 4THF97073508

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 411 1ST AVE S STE 600, SEATTLE, WA, 98104

Business Categories: Category Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,199,840

Exercised Options: $17,199,840

Current Obligation: $17,199,840

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS35F0196R

IDV Type: FSS

Timeline