Department of the Navy awards $128M cloud hosting contract to Advantaged Solutions, LLC

Contract Overview

Contract Amount: $128,016,000 ($128.0M)

Contractor: Advantaged Solutions, LLC

Awarding Agency: Department of Defense

Start Date: 2018-06-20

End Date: 2021-02-19

Contract Duration: 975 days

Daily Burn Rate: $131.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF CLOUD HOSTING - CLOUD SERVICE OFFERING

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20019

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $128.0 million to ADVANTAGED SOLUTIONS, LLC for work described as: IGF::OT::IGF CLOUD HOSTING - CLOUD SERVICE OFFERING Key points: 1. Contract value of $128M over three years indicates significant investment in cloud infrastructure. 2. Full and open competition suggests a potentially competitive bidding process. 3. Fixed-price contract type may offer cost certainty but could limit flexibility. 4. Delivery order award suggests this is part of a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle. 5. Contract performance period of 975 days (approx. 2.7 years) aligns with typical cloud service lifecycles. 6. The award to Advantaged Solutions, LLC warrants scrutiny of their past performance and capacity for large-scale cloud services.

Value Assessment

Rating: fair

Benchmarking cloud hosting services at this scale is complex without specific service level agreements and detailed pricing breakdowns. The total award of $128M over approximately 2.7 years suggests an average annual spend of around $47.4M. This figure needs to be compared against similar large-scale cloud hosting contracts awarded by the DoD and other federal agencies to assess value for money. Factors like the specific cloud environment (e.g., public, private, hybrid), data security requirements, and included support services significantly influence pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this specific delivery order. While full and open competition is generally preferred for maximizing price discovery and innovation, the actual level of competition can vary based on the complexity and specialized nature of the services required, as well as the number of qualified vendors in the market.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down prices through vendor rivalry. A competitive process increases the likelihood that the government secures services at a fair and reasonable cost, preventing potential overspending that might occur with less competitive or sole-source awards.

Public Impact

The primary beneficiaries are the Department of the Navy and its various components, gaining access to modern cloud hosting capabilities. Services delivered include the hosting of critical data and applications, supporting naval operations and administrative functions. The geographic impact is primarily within the District of Columbia, where the contractor is based, but the cloud services themselves will support operations globally. Workforce implications may include the need for specialized IT personnel within the Navy to manage and integrate cloud services, as well as employment opportunities at Advantaged Solutions, LLC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if migration to other cloud providers is complex or costly.
Ensuring data security and compliance with federal regulations (e.g., FedRAMP) in a cloud environment is a continuous challenge.
Performance variability in cloud services can impact critical naval operations if not adequately managed and monitored.

Positive Signals

Leveraging cloud technology can enhance operational agility and scalability for the Navy.
A fixed-price contract can provide budget predictability for the awarded services.
Full and open competition suggests an effort to obtain competitive pricing and a wide range of potential solutions.

Sector Analysis

The cloud computing market is a rapidly growing sector within the IT industry, with significant government spending allocated to cloud migration and services. Federal agencies are increasingly adopting cloud solutions to modernize infrastructure, improve efficiency, and enhance cybersecurity. This contract for cloud hosting services fits within the broader trend of the Department of Defense's strategic shift towards cloud-based operations, aiming to achieve greater interoperability and cost savings. Comparable spending benchmarks would involve analyzing other large-scale cloud service contracts awarded to major cloud providers and specialized IT firms.

Small Business Impact

This contract does not appear to have a small business set-aside component, as the awardee is Advantaged Solutions, LLC, which is not typically classified as a small business for federal contracting purposes. The contract's value and nature suggest it is likely part of a larger vehicle where subcontracting opportunities might exist for small businesses, particularly in specialized IT support or niche service areas. However, without specific subcontracting plans or data, the direct impact on the small business ecosystem is unclear.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations into potential fraud, waste, or abuse. Transparency is facilitated through contract award databases like FPDS-NG, which provide basic details of the award. Performance monitoring and adherence to service level agreements would be managed by the Navy's technical points of contact.

Related Government Programs

DoD Cloud Computing Strategy
General Services Administration (GSA) Cloud Offerings
Defense Information Systems Agency (DISA) Cloud Services

Risk Flags

Potential for vendor lock-in
Data security and compliance risks
Performance variability impacting operations
Contractor's capacity for large-scale cloud management

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $128.0 million to ADVANTAGED SOLUTIONS, LLC. IGF::OT::IGF CLOUD HOSTING - CLOUD SERVICE OFFERING

Who is the contractor on this award?

The obligated recipient is ADVANTAGED SOLUTIONS, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $128.0 million.

What is the period of performance?

Start: 2018-06-20. End: 2021-02-19.

What is the specific nature of the cloud services being provided under this contract (e.g., IaaS, PaaS, SaaS, specific cloud environment)?

The provided data indicates 'IGF CLOUD HOSTING - CLOUD SERVICE OFFERING' as the description. While not explicitly detailing IaaS, PaaS, or SaaS, 'cloud hosting' generally implies Infrastructure as a Service (IaaS) or Platform as a Service (PaaS) where the contractor provides the underlying computing resources or a platform for applications. The specific environment (public, private, hybrid, or community cloud) is not detailed but is crucial for understanding security, cost, and performance implications. Further details would likely be found in the contract's statement of work (SOW) or performance work statement (PWS).

How does the pricing structure of this $128M contract compare to industry benchmarks for similar cloud hosting services?

Direct comparison of the total contract value ($128M over ~2.7 years) to industry benchmarks is challenging without granular data on service levels, resource utilization (e.g., compute hours, storage, bandwidth), and specific service components (e.g., managed services, security features). However, the average annual spend of approximately $47.4M suggests a significant commitment. To benchmark effectively, one would need to compare per-unit costs for comparable services (e.g., per virtual CPU, per GB of storage, per data transfer) against rates offered by major cloud providers (AWS, Azure, GCP) and other government-contracting cloud service providers, considering any government-specific discounts or contract vehicles.

What is Advantaged Solutions, LLC's track record with large-scale federal cloud hosting contracts, particularly within the Department of Defense?

Assessing Advantaged Solutions, LLC's track record requires examining their contract history, past performance evaluations, and any reported issues or successes on similar large-scale cloud hosting projects. Information on their experience with DoD cloud initiatives, their ability to meet stringent security requirements (like FedRAMP authorization levels), and their capacity to manage complex cloud environments would be critical. A review of their portfolio and client testimonials, alongside government performance data, would provide insight into their reliability and expertise in this domain.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract, and how are they monitored?

The provided data does not specify the KPIs or SLAs for this contract. Typically, cloud hosting contracts include metrics related to uptime/availability (e.g., 99.9% or higher), latency, data transfer speeds, response times for support, and security incident response times. Monitoring these KPIs and SLAs is usually managed by the contracting officer's representative (COR) or a designated technical point of contact within the Department of the Navy, often supported by automated monitoring tools and regular performance reviews with the contractor.

What is the historical spending trend for cloud hosting services within the Department of the Navy, and how does this award fit into that trend?

Historical spending data for cloud hosting within the Department of the Navy would reveal trends in modernization efforts and the adoption of cloud technologies. This $128M award represents a substantial investment, likely part of a broader strategic initiative to migrate critical IT infrastructure to the cloud. Analyzing prior years' spending on similar services, including contracts with other providers or through different vehicles, would indicate whether this award signifies an increase in cloud adoption, a consolidation of services, or a shift in strategy. It aligns with the overall federal push towards cloud-first architectures.

What are the potential risks associated with relying on Advantaged Solutions, LLC for critical cloud hosting services, and what mitigation strategies are in place?

Potential risks include vendor performance issues (e.g., service outages, security breaches), financial instability of the contractor, challenges in data migration or integration, and potential cost overruns if not managed tightly under the fixed-price structure. Mitigation strategies typically involve robust contract oversight, regular performance reviews, clearly defined SLAs with penalties for non-compliance, contingency planning for service disruptions, and potentially maintaining relationships with alternative providers for critical functions.

Industry Classification

NAICS: Retail Trade › Electronics and Appliance Stores › Computer and Software Stores

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: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4810 JAY ST NE, WASHINGTON, DC, 20019

Business Categories: Black American Owned Business, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $129,086,097

Exercised Options: $128,618,127

Current Obligation: $128,016,000

Actual Outlays: $38,495,650

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0010408AZF42

IDV Type: IDC

Timeline