- Dell has won a Pentagon contract worth $9.7 billion
- The technology services business will act as a single point of purchase
- The Pentagon, the intelligence community and the Coast Guard will jointly acquire software
The Pentagon is seeking to reduce costs and stop proliferation of software licenses in its latest contracts with Dell and Microsoft.
A $9.69 billion contract has been awarded to Dell to act as a single point of purchase for Microsoft licenses across the US Department of Defense, the intelligence community and the Coast Guard. The contract will move the Pentagon and other military departments away from double spending on Microsoft licenses.
Defense Department Chief Information Officer Kirsten Davies said the contract would allow the Pentagon to save $422 million annually by consolidating “existing IT budgets from all services and agencies into a single efficient vehicle.”
Annual savings of $422 million
The contract awarded to Dell – known as the Microsoft Department of War Enterprise Software Agreement II Core Enterprise Technology Agreement – allows Dell to provide Microsoft 365, advanced cloud subscriptions and on-premises licenses. The contract continues the Pentagon’s existing Enterprise Technology Agreement with Dell and Microsoft.
However, the 9.7 billion dollars is not new funding, but a consolidation of budgets from contracts that have come up for renewal at the same time.
“This second-generation blanket purchase agreement will streamline and consolidate critical Microsoft software and services across the Department of War, the intelligence community and the U.S. Coast Guard,” Davies said.
Acting Navy Chief Information Officer Barry Tanner said, “The vendors were all evaluated based on competition, comparison to GSA plan pricing and overall value chain for the department. After going through the evaluation process, they came out on top.”
Michael Dell, the founder and CEO of Dell Technologies, recently wooed President Donald Trump by pledging $6.25 billion to fund investment accounts for children, called “Trump accounts” in the president’s honor.
The Defense Department has been under increasing scrutiny across the political divide as it seeks approval of a $1.5 trillion budget for 2027. The Pentagon has failed every audit it has undertaken since they were mandated by law in 2018, with the Pentagon aiming to pass its first audit by 2028.
Via CNBC
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