NASA raises eyebrows with low outsourcing prices

Outsourcing its desktop PC operations will cost NASA less than it had anticipated.

The cost of desktop PCs at NASA’s Goddard Space Flight Center in Greenbelt, Md.,
through the Outsourcing Desktop Initiative at NASA, will run from $2,000 to $3,400 per
seat annually, said Mark Hagerty, the agency’s ODIN program manager.

“The fee is dramatically lower than what we’ve seen in the industry,” he

Many government and industry executives who have been monitoring ODIN and the General
Services Administration’s Seat Management Program said they were shocked by the

A study earlier this year by GartnerGroup Inc. of Stamford, Conn., estimated annual PC
expenses at about $8,000 per seat. And a study of 400 seats for an office in GSA’s
Federal Technology Service pegged the per-seat price at $8,200.

“We attribute the lower fee to our good, solid due-diligence process,”
Hagerty said. “The vendors validated our inventory and infrastructure, which helped
identify what we need.”

It is not completely clear what the Goddard cost figure covers, and some officials
suggested that the final per-seat price tag might rise. Wanda N. Smith, manager of
GSA’s Seat Management, said it is important that agencies compare apples with apples.

“People want to say, ‘How much did your seat cost?’ But you have to make
sure it’s an equivalent seat when you’re comparing them,” Smith said.

The ODIN figures represent contract dollars, not total cost of ownership, Smith said.
Contract dollars are calculated by dividing the contract award by the number of seats, but
some of those seats represent LAN connections rather than full-service PCs for which the
contractor would be responsible, she said.

Donald R. Johnson, vice president of technology and strategic studies for Federal
Sources Inc. of McLean, Va., said agencies need to look beyond the numbers to make an
accurate comparison.

“There’s useful information contained behind those numbers,” he said,
but added, “You don’t know exactly what they promised for that. You have to have
all the information together to make a comparison. That has to be done in an orderly,
systematic fashion.”

Total cost of ownership is difficult to nail down because everybody defines it
differently, Smith said.

Johnson recommended that agencies spend the arduous but necessary effort establishing a
baseline cost. That sum includes relatively accessible cost data, such as hardware and
software license fees and contracting management costs. Agencies then must figure the cost
of network maintenance and labor, and finally, the less tangible expenses, such as help
desk services, that can fluctuate according to service levels.

Using the baseline, agencies can then compare current costs to seat management proposal
prices, Johnson said.

NASA later this month will release the annual per-seat costs for desktop PCs at the
Johnson, Kennedy and Stennis space centers and the Marshall Space Flight Center.

“We anticipate the fee will be similar to what Goddard received,” Hagerty

NASA in late October awarded a $154.9 million task order to OAO Corp. of Greenbelt,
Md., for the four NASA centers. Earlier that month, the agency awarded a $19.6 million
ODIN order to RMS Information Systems Inc. of Vienna, Va., to take over Goddard’s PC

Meanwhile, GSA is working on the details for the first task order under Seat
Management. It selected Litton PRC Inc. last month to take over PC operations at GSA.

NASA in the coming six months will award as many as five more contracts under ODIN,
including one for services at NASA headquarters.

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