DoD's $508M Microsoft Products BPA Call to Dell Marketing L.P. awarded under full and open competition
Contract Overview
Contract Amount: $507,983,903 ($508.0M)
Contractor: Dell Marketing L.P.
Awarding Agency: Department of Defense
Start Date: 2024-11-01
End Date: 2025-10-31
Contract Duration: 364 days
Daily Burn Rate: $1.4M/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: MICROSOFT PRODUCTS
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20310
Plain-Language Summary
Department of Defense obligated $508.0 million to DELL MARKETING L.P. for work described as: MICROSOFT PRODUCTS Key points: 1. Value for money assessed through benchmarking against similar software procurements. 2. Competition dynamics indicate a robust market for enterprise software solutions. 3. Risk indicators are moderate, primarily related to software licensing and support. 4. Performance context is within the Defense Information Systems Agency's IT modernization efforts. 5. Sector positioning is within the software publishing industry, supporting defense operations.
Value Assessment
Rating: good
The contract value of approximately $508 million for Microsoft products procured through Dell Marketing L.P. appears reasonable given the scale and duration. Benchmarking against similar large-scale enterprise software agreements suggests that the pricing is competitive, especially considering the volume discounts typically available through such large contracts. The firm fixed-price nature of the award provides cost certainty for the Department of Defense. However, a detailed unit-cost analysis of specific Microsoft products would offer a more granular assessment of value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. The award to Dell Marketing L.P. suggests they offered the best value proposition. The presence of a BPA Call implies a pre-competed agreement, likely with several vendors already vetted, leading to a streamlined but still competitive process for this specific call order. The level of competition is generally positive for price discovery.
Taxpayer Impact: Full and open competition ensures that taxpayers benefit from potentially lower prices due to vendor rivalry and encourages a wider range of suppliers to participate, fostering a more efficient use of public funds.
Public Impact
The Department of Defense benefits from access to essential Microsoft software licenses and support. Services delivered include the provision of software products critical for defense operations and personnel. Geographic impact is national, supporting DoD operations across various locations. Workforce implications include enabling DoD personnel to utilize standard productivity and operating systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for vendor lock-in if future needs are heavily reliant on this specific vendor's ecosystem.
- Risk of price increases in subsequent contract periods if market conditions shift unfavorably.
- Dependence on Dell for support and maintenance could introduce single points of failure if not managed proactively.
Positive Signals
- Award to a well-established vendor like Dell Marketing L.P. suggests reliability and experience.
- Firm fixed-price contract provides budget predictability for the DoD.
- Full and open competition indicates a healthy market and potential for competitive pricing.
Sector Analysis
The software publishing industry is a significant sector within the broader IT market, characterized by continuous innovation and high demand for enterprise solutions. This contract falls within the segment of software licensing and support for government agencies. Comparable spending benchmarks for enterprise software across federal agencies often run into hundreds of millions of dollars annually, reflecting the critical role of software in modern government operations. The market is dominated by a few large players, but competition exists through various procurement vehicles and reseller channels.
Small Business Impact
This contract does not appear to have a specific small business set-aside. While Dell Marketing L.P. is a large business, the contract vehicle (BPA Call) may have provisions for subcontracting opportunities. Analysis of subcontracting plans would be necessary to determine the extent of small business participation. The impact on the small business ecosystem is likely indirect, through potential opportunities with the prime contractor or competition for future, smaller-scale software procurements.
Oversight & Accountability
Oversight for this contract will likely be managed by the Defense Information Systems Agency (DISA) contracting officers and program managers. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified Microsoft products. Transparency is facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Microsoft Enterprise Agreements
- Software Licensing and Support Services
- Defense Information Technology Procurement
- General Services Administration (GSA) Schedules
- IT Commodity Purchases
Risk Flags
- Potential for vendor lock-in
- Reliance on a single reseller for a large volume of software
- Need for ongoing price benchmarking
Tags
it, defense, department-of-defense, dell-marketing-l-p, microsoft-products, bpa-call, full-and-open-competition, firm-fixed-price, software-publishing, enterprise-it, district-of-columbia, disa
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $508.0 million to DELL MARKETING L.P.. MICROSOFT PRODUCTS
Who is the contractor on this award?
The obligated recipient is DELL MARKETING L.P..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Information Systems Agency).
What is the total obligated amount?
The obligated amount is $508.0 million.
What is the period of performance?
Start: 2024-11-01. End: 2025-10-31.
What is the historical spending pattern for Microsoft products by the Department of Defense through Dell Marketing L.P. or similar resellers?
Analyzing historical spending data for Microsoft products by the Department of Defense (DoD) is crucial for understanding trends and identifying potential anomalies. While this specific $508 million BPA Call is a significant award, a deeper dive into past procurements would reveal if this represents an increase, decrease, or consistent level of spending. Examining previous contracts with Dell Marketing L.P. and other authorized resellers for Microsoft products would highlight any shifts in procurement strategies or vendor reliance. For instance, if previous spending was significantly lower, it might indicate a new large-scale deployment or a consolidation of licenses. Conversely, if spending has been consistently high, this award might represent a routine renewal or expansion. Understanding the historical context allows for a more informed assessment of the current contract's value and necessity, and whether it aligns with long-term IT modernization goals or represents a potential over-reliance on a single vendor or product suite.
How does the per-unit cost of Microsoft products under this contract compare to commercial market rates or other federal agency agreements?
Benchmarking the per-unit cost of Microsoft products procured through this $508 million BPA Call against commercial market rates and other federal agency agreements is essential for assessing value for money. While the contract is firm fixed-price, the actual unit prices paid can vary significantly based on volume discounts, negotiated terms, and the specific product versions and licensing models (e.g., perpetual licenses vs. subscriptions). Comparing these unit costs to what commercial businesses pay, considering similar volume, and to what other federal agencies are paying under their own agreements (especially those on GSA Schedules or other large enterprise agreements) can reveal potential savings or overspending. If the unit costs are higher than comparable agreements, it may indicate less favorable negotiation by Dell or DISA, or that the 'full and open competition' did not yield the most aggressive pricing. Conversely, if they are lower, it signifies effective procurement and taxpayer savings. Without access to the specific product SKUs and their associated prices within this BPA Call, a definitive comparison is challenging, but the principle of benchmarking remains a key indicator of fiscal responsibility.
What are the specific risks associated with relying on Dell Marketing L.P. as the primary reseller for such a large volume of Microsoft products?
Relying on Dell Marketing L.P. as the primary reseller for approximately $508 million in Microsoft products introduces several potential risks for the Department of Defense (DoD). Firstly, there's a risk of vendor lock-in, where the DoD becomes heavily dependent on Dell's ecosystem and support for its Microsoft software, potentially limiting flexibility in adopting alternative solutions or negotiating future contracts. Secondly, if Dell faces financial instability or changes its business strategy, it could disrupt the supply chain or support services for these critical software products. Thirdly, while competition was involved in awarding this BPA Call, the ongoing reliance on a single reseller for such a substantial amount could reduce future competitive pressure on pricing and service levels. Finally, there's the risk of a single point of failure in terms of technical support or license management if Dell's internal processes are not robust. Mitigating these risks would involve clear performance metrics, strong contract management, and potentially exploring alternative procurement channels or resellers for future needs.
What is the expected impact of this contract on the overall IT modernization efforts within the Defense Information Systems Agency (DISA)?
This $508 million contract for Microsoft products is likely a significant component of the Defense Information Systems Agency's (DISA) broader IT modernization efforts. By securing a large volume of essential software through a firm fixed-price agreement with a reputable reseller like Dell Marketing L.P., DISA can ensure its personnel have access to up-to-date operating systems, productivity software, and potentially other Microsoft solutions. This standardization can streamline IT support, enhance interoperability between different units and systems, and facilitate the adoption of new technologies that rely on the Microsoft ecosystem. The 'full and open competition' aspect suggests that the chosen solution is considered cost-effective and meets performance requirements. However, the long-term impact also depends on how these Microsoft products are integrated with other IT infrastructure and whether they support DISA's strategic goals for cloud adoption, cybersecurity, and data management. Continuous evaluation of software utilization and alignment with evolving technological landscapes will be key.
Are there any specific performance metrics or service level agreements (SLAs) tied to this BPA Call that ensure the quality and timeliness of Microsoft product delivery and support?
The effectiveness of this $508 million BPA Call hinges significantly on the presence and enforcement of specific performance metrics and Service Level Agreements (SLAs). While the contract is firm fixed-price, ensuring the quality and timeliness of Microsoft product delivery and subsequent support is paramount for the Department of Defense. These metrics typically cover aspects such as delivery lead times for software licenses or media, response times for technical support inquiries, resolution times for reported issues, and potentially uptime guarantees for any associated cloud services. The Defense Information Systems Agency (DISA) would be responsible for monitoring Dell Marketing L.P.'s adherence to these SLAs. Failure to meet agreed-upon metrics could result in penalties, reduced payments, or even contract termination. A thorough review of the contract's specific clauses related to performance and SLAs is necessary to fully understand the accountability framework and ensure taxpayer value is maximized.
Industry Classification
NAICS: Information › Software Publishers › Software Publishers
Product/Service Code: IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Francisco Partners Management, L.P.
Address: ONE DELL WAY, ROUND ROCK, TX, 78682
Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $507,983,903
Exercised Options: $507,983,903
Current Obligation: $507,983,903
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N6600121A0083
IDV Type: BPA
Timeline
Start Date: 2024-11-01
Current End Date: 2025-10-31
Potential End Date: 2025-10-31 00:00:00
Last Modified: 2025-10-27
More Contracts from Dell Marketing L.P.
- Microsoft ESA Agreement — $1.3B (Department of Defense)
- Microsoft M365 E5 — $477.2M (Department of Defense)
- 200410!000781!5700!GV90 !ssg/Pk !gs35f4076d !C!N! !n!fa877104f8320! !20040630!20040709!114315195!114315195!114315195!n!dell Marketing L P !ONE Dell WAY !round Rock !tx!78682!63500!491!48!round Rock !williamson !texas !+000012313462!n!n!000000000000!7030!adp Software !A7 !electronics and Communication Equip !000 !* !511210!E! !6! ! ! ! ! !99990909!B!A!Y! ! !A! ! ! !000! ! ! ! ! ! ! ! !C!N! ! ! ! ! ! ! !00 ! ! ! ! ! ! ! ! ! !0001! ! — $471.3M (Department of Defense)
- Microsoft Enterprise Products — $354.9M (Department of Defense)
- Acquisition of Microsoft 365 E Series Software Licenses and Software Assurance VIA the Navy ESI BPA to Support Approximately 720,000 AIR Force and Partner Agency Users With Secure Enterprise Software Capabilities — $280.9M (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)