DoD awards $47.5M IT services contract to Peraton Inc. for cyber operations in Europe
Contract Overview
Contract Amount: $47,528,894 ($47.5M)
Contractor: Peraton Inc.
Awarding Agency: Department of Defense
Start Date: 2023-09-28
End Date: 2026-04-18
Contract Duration: 933 days
Daily Burn Rate: $50.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: IT
Official Description: NON-PERSONAL INFORMATION TECHNOLOGY SERVICES FOR THE REGIONAL CYBER CENTER-EUROPE.
Plain-Language Summary
Department of Defense obligated $47.5 million to PERATON INC. for work described as: NON-PERSONAL INFORMATION TECHNOLOGY SERVICES FOR THE REGIONAL CYBER CENTER-EUROPE. Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. 3. The duration of 933 days (approx. 2.5 years) indicates a medium-term need for these services. 4. The North American Industry Classification System (NAICS) code 541519 points to a broad range of IT services. 5. The award amount of $47.5M is significant, requiring robust oversight. 6. The contract is for non-personal IT services, meaning it does not involve direct interaction with military personnel. 7. The regional cyber center in Europe suggests a focus on critical defense infrastructure and operations.
Value Assessment
Rating: fair
The contract value of $47.5M for approximately 2.5 years of IT services appears to be within a reasonable range for specialized cyber operations support in a European theater. Benchmarking against similar IT service contracts for defense agencies, especially those involving cyber capabilities and international operations, would be necessary for a definitive value assessment. The Cost Plus Fixed Fee (CPFF) contract type introduces some risk regarding cost control, as contractor profit is fixed, but costs can fluctuate. Without detailed cost breakdowns and performance metrics, a precise value-for-money assessment is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The data shows 3 bids were received. A competitive process like this generally promotes price discovery and can lead to more favorable pricing for the government. However, the number of bidders (3) is moderate, and further analysis would be needed to understand if this level of competition was sufficient to drive the most aggressive pricing.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of obtaining services at a competitive price, preventing potential overpayment that could occur with less competitive solicitations.
Public Impact
The primary beneficiaries are the Department of Defense and its regional cyber center in Europe, which will receive essential IT support. Services delivered include non-personal IT support crucial for maintaining and enhancing cyber defense capabilities in a strategic geographic location. The geographic impact is focused on Europe, supporting U.S. military operations and cyber resilience in that region. Workforce implications are likely to involve specialized IT and cybersecurity professionals, potentially including both U.S. personnel and local hires in Europe.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- The CPFF contract type can incentivize contractors to incur costs without strict adherence to budget, potentially leading to cost overruns.
- Limited information on specific performance metrics makes it difficult to assess the contractor's track record and the effectiveness of the services.
- The moderate number of bidders (3) might suggest that the market for these highly specialized services is limited, potentially impacting future competition.
- The contract's focus on cyber operations in Europe could expose it to geopolitical risks and evolving threat landscapes.
Positive Signals
- Awarded through full and open competition, ensuring a broad range of potential contractors could participate.
- The contract is for non-personal services, which typically reduces the government's administrative burden compared to personal services.
- The duration of the contract provides stability for the cyber center's IT operations.
- Peraton Inc. is a known entity in the government contracting space, particularly in defense and intelligence sectors.
Sector Analysis
This contract falls within the Information Technology (IT) services sector, specifically focusing on computer-related services. The market for IT and cybersecurity services for defense agencies is substantial and highly competitive, driven by the increasing reliance on digital infrastructure and the growing threat of cyber warfare. Comparable spending benchmarks for similar IT support contracts within the Department of Defense, particularly those supporting operational units or specialized centers like cyber commands, would provide further context. The global nature of cyber threats means that IT service providers supporting defense operations often require specialized expertise and security clearances.
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 through full and open competition, there may be opportunities for small businesses to participate as subcontractors to the prime contractor, Peraton Inc. However, the extent of small business subcontracting is not detailed in the provided information and would require further investigation into the contract's subcontracting plan, if one exists.
Oversight & Accountability
Oversight for this contract will likely be managed by the Department of the Army, under the Department of Defense. Mechanisms would include contract performance reviews, financial audits, and adherence to the terms of the Cost Plus Fixed Fee agreement. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.
Related Government Programs
- Regional Cyber Center Operations
- Department of Defense IT Services
- Cybersecurity Support Contracts
- European Theater Operations Support
- Non-Personal IT Services
- Cost Plus Fixed Fee Contracts
Risk Flags
- Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
- Moderate number of bidders may indicate limited market competition for specialized services.
- Cyber operations are subject to evolving threats and geopolitical factors.
- Non-personal services require clear definition of deliverables and performance standards.
Tags
it-services, department-of-defense, department-of-the-army, cybersecurity, europe, full-and-open-competition, cost-plus-fixed-fee, non-personal-services, it-support, defense-operations, medium-contract-value, peraton-inc
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $47.5 million to PERATON INC.. NON-PERSONAL INFORMATION TECHNOLOGY SERVICES FOR THE REGIONAL CYBER CENTER-EUROPE.
Who is the contractor on this award?
The obligated recipient is PERATON INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $47.5 million.
What is the period of performance?
Start: 2023-09-28. End: 2026-04-18.
What is Peraton Inc.'s track record with the Department of Defense, particularly on similar IT and cybersecurity contracts?
Peraton Inc. has a significant history of contracting with the Department of Defense and other federal agencies, often in areas related to intelligence, defense, and IT services. They have been involved in numerous large-scale contracts, including those for space systems, cyber operations, and mission support. Analyzing their past performance on Cost Plus Fixed Fee (CPFF) contracts, especially those with similar scopes of work and values, would be crucial. This would involve reviewing past performance evaluations, any reported contract disputes or terminations, and their success in meeting cost and schedule targets on previous DoD engagements. A review of their financial stability and capacity to handle a contract of this magnitude is also pertinent.
How does the awarded amount of $47.5M compare to similar IT support contracts for regional cyber centers or equivalent defense operations in Europe?
Benchmarking the $47.5M award against similar contracts requires access to detailed contract data for comparable services. Contracts for IT support, network management, and cybersecurity operations for military commands, especially those operating in high-threat environments like Europe, can vary significantly based on scope, duration, and specific requirements. A preliminary comparison suggests that $47.5M over approximately 2.5 years (933 days) is a substantial but not necessarily excessive amount for specialized cyber support. Factors such as the level of security required, the complexity of the IT infrastructure supported, and the specific services (e.g., threat intelligence, network defense, incident response) will influence the cost. Without specific comparable contract data, it's difficult to definitively state if this represents excellent or questionable value.
What are the primary risks associated with the Cost Plus Fixed Fee (CPFF) contract type for this specific cyber operations support?
The primary risk with a CPFF contract is that the contractor is reimbursed for all allowable costs incurred, plus a fixed fee representing profit. While the fee is fixed, the total cost to the government can exceed initial estimates if costs escalate. For cyber operations support, this risk is amplified by the potential for unforeseen technical challenges, evolving threat landscapes requiring rapid adaptation, and the need for specialized, potentially expensive, personnel or technologies. Effective oversight is critical to ensure that costs are reasonable and allowable, and that the contractor is incentivized to manage expenses efficiently despite the fixed fee structure. Without stringent cost monitoring and performance management, CPFF contracts can lead to cost overruns.
What is the expected impact of these IT services on the operational effectiveness of the Regional Cyber Center-Europe?
These non-personal IT services are expected to directly enhance the operational effectiveness of the Regional Cyber Center-Europe by ensuring the reliability, security, and performance of its underlying IT infrastructure. This includes maintaining networks, managing systems, providing technical support, and potentially implementing cybersecurity measures. By outsourcing these functions to Peraton Inc., the DoD aims to leverage specialized expertise and allow military personnel to focus on core cyber defense missions, threat analysis, and strategic planning. The successful delivery of these services should contribute to a robust cyber defense posture, enabling the center to effectively monitor, detect, and respond to cyber threats within its area of responsibility.
How has historical spending on similar IT services for European-based defense operations evolved over the past five years?
Analyzing historical spending trends for IT services supporting European-based defense operations requires access to comprehensive federal procurement data. Generally, spending in this area has likely increased over the past five years due to the heightened geopolitical tensions and the growing sophistication of cyber threats. Defense agencies are increasingly investing in advanced cybersecurity capabilities, network modernization, and IT infrastructure resilience to counter evolving threats. Contracts for cyber operations support, network management, and IT infrastructure maintenance in theaters like Europe are critical components of this spending. Specific data would reveal whether this $47.5M award represents a continuation of established spending patterns, an increase, or a decrease relative to previous investments in similar capabilities.
What specific cybersecurity capabilities or services are implied by the NAICS code 541519 and the contract's description?
The NAICS code 541519, 'Other Computer Related Services,' is broad and encompasses a wide array of IT services beyond basic support. For a Regional Cyber Center in Europe, this likely includes services such as network design and implementation, IT system integration, cybersecurity consulting, vulnerability assessments, penetration testing, incident response support, and potentially managed security services. The contract's description, 'NON-PERSONAL INFORMATION TECHNOLOGY SERVICES,' further suggests that the focus is on the technical and operational aspects of IT and cybersecurity, rather than direct personnel augmentation. These services are critical for maintaining the integrity, confidentiality, and availability of sensitive defense information and systems within the European theater.
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 - NETWORK
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12975 WORLDGATE DR STE 7322, HERNDON, VA, 20170
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $53,289,431
Exercised Options: $53,289,431
Current Obligation: $47,528,894
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $19,390,618
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: W52P1J18DA137
IDV Type: IDC
Timeline
Start Date: 2023-09-28
Current End Date: 2026-04-18
Potential End Date: 2026-04-18 00:00:00
Last Modified: 2026-01-08
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