DoD's $30M Red Hat Software Purchase via BPA Call: DLT Solutions Awarded Contract

Contract Overview

Contract Amount: $29,953,561 ($30.0M)

Contractor: DLT Solutions, LLC

Awarding Agency: Department of Defense

Start Date: 2019-08-27

End Date: 2021-08-23

Contract Duration: 727 days

Daily Burn Rate: $41.2K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: RED HAT SOFTWARE.

Place of Performance

Location: ABERDEEN PROVING GROUND, HARFORD County, MARYLAND, 21005

State: Maryland Government Spending

Plain-Language Summary

Department of Defense obligated $30.0 million to DLT SOLUTIONS, LLC for work described as: RED HAT SOFTWARE. Key points: 1. Significant spending on software licenses and support. 2. Competition was limited, awarded under a Blanket Purchase Agreement (BPA) Call. 3. Risk of overpayment due to limited competition. 4. Sector is IT - Software Publishers.

Value Assessment

Rating: fair

The contract value of $29.9M over two years for Red Hat software is substantial. Benchmarking against similar enterprise software agreements is difficult without specific license counts and support levels, but the limited competition raises concerns about potential overpricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under Special Acquisition Procedures (SAP) and awarded as a BPA Call. While some competition may have occurred, the BPA structure can limit broader market engagement and price discovery, potentially leading to less favorable pricing.

Taxpayer Impact: Taxpayer funds are used for this software acquisition. The limited competition suggests potential for higher costs than if a more open competition had been conducted.

Public Impact

Ensures critical software infrastructure for the Department of the Army. Supports ongoing operations and maintenance of existing systems. Potential for cost savings if future procurements achieve better pricing through enhanced competition.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
Potential for price creep on renewals
Reliance on a single vendor for critical software

Positive Signals

Supports essential defense operations
Firm Fixed Price contract limits cost uncertainty

Sector Analysis

The IT sector, specifically software publishers, is a significant area of government spending. This contract for Red Hat software aligns with common enterprise IT needs, but benchmarks are highly dependent on specific product versions and support agreements.

Small Business Impact

There is no indication that small businesses were involved in this specific BPA Call award. Future opportunities could be explored to ensure small business participation in software procurements.

Oversight & Accountability

The use of a BPA Call suggests some level of pre-negotiated terms, but the specific oversight mechanisms for this call are not detailed. Ensuring fair pricing and performance requires ongoing monitoring by the contracting officer.

Related Government Programs

Software Publishers
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Limited competition may lead to higher costs.
Potential for vendor lock-in.
Lack of transparency in the procurement process.
Risk of inadequate support if vendor performance is not closely monitored.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.0 million to DLT SOLUTIONS, LLC. RED HAT SOFTWARE.

Who is the contractor on this award?

The obligated recipient is DLT SOLUTIONS, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $30.0 million.

What is the period of performance?

Start: 2019-08-27. End: 2021-08-23.

What was the specific justification for using SAP and a BPA Call instead of a broader competition for this significant software purchase?

The justification for using Special Acquisition Procedures (SAP) and a Blanket Purchase Agreement (BPA) Call typically involves urgency, specific technical requirements, or existing contract vehicles that streamline procurement. Without further details, it's difficult to ascertain the exact rationale. However, such methods can sometimes bypass more robust competitive processes, potentially impacting overall value for money.

How does the per-unit cost of this Red Hat software acquisition compare to commercial market rates or other government agency purchases?

A direct per-unit cost comparison is challenging without knowing the exact Red Hat products, license types (e.g., subscription, perpetual), and support levels included. Government contracts often negotiate volume discounts, but limited competition can negate these benefits. A thorough analysis would require detailed product breakdowns and comparison against GSA schedules or other agency contracts for similar Red Hat offerings.

What measures are in place to ensure the continued effectiveness and security of the Red Hat software throughout the contract period?

Effectiveness and security are typically ensured through contract clauses requiring vendor support, maintenance, and timely delivery of updates and patches. The Department of the Army would likely have technical points of contact monitoring performance and security compliance. Regular reviews and adherence to cybersecurity protocols are crucial for maintaining the software's integrity and operational readiness.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Tech Data Corporation

Address: 2411 DULLES CORNER PARK STE 800, HERNDON, VA, 20171

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

Financial Breakdown

Contract Ceiling: $34,343,040

Exercised Options: $29,953,561

Current Obligation: $29,953,561

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: HC102818A0002

IDV Type: BPA

Timeline