Pentagon awards Dell $9.7 billion contract to consolidate software licenses

WASHINGTON — The Pentagon awarded Dell Federal Systems a $9.7 billion Core Enterprise Technology Agreement (CETA) to consolidate Microsoft software, services and licenses across the Department of Defense, top officials told reporters today.

The five-year blanket purchase agreement, which is part of the second iteration of the Enterprise Software Agreement, aims to streamline the services provided to all the department, Intelligence Community and Coast Guard.

“By providing enterprise access to Microsoft 365 advanced cloud subscriptions and critical on premises licensing, this CETA acts as part of the digital connective tissue essential for Combined Joint All-Domain Command and Control, CJADC2,” Kirsten Davies, DoD chief information officer, told reporters at the Pentagon today. “This ensures our war fighters have the tools for just in time data sharing, supports our pivot to AI and data analytics, and undergirds uninterrupted operational continuity for our most sensitive and disconnected environments.”

The agreement is not new funding, but rather consolidates existing IT budgets from the services and agencies into a single contract vehicle that is managed by the Navy and can be accessed by all organizations within the DoD.

The CETA allows the DoD to rapidly acquire and deploy software and cloud capabilities while reducing delays with what officials described as fragmented procurement processes.

“We’re putting it all together in one place in order to renegotiate at our size and scale, which drives more optimization and efficiency,” Davies said.

Moreover, Davies noted the blanket purchase agreement is expected to save $422 million annually, which the department expects to rise as it fully consolidates IT services.

“This really is a game changer. It’s the culmination of lessons we’ve learned over the last five years, the successes that have been built for all of the services,” Barry Tanner, who is performing the duties of the chief information officer for the Department of the Navy, told reporters. “It improves capability while driving efficiency across the department.

Davies said as part of her strategy and transformation agenda, there will be an increased focus on enterprise-wide cybersecurity standards.