Air Force drops Desktop IDIQs

In an about-face on acquisition, the Air Force recently set a policy to meet its PC,
server and communications needs through blanket purchasing agreements.


The policy announcement by the Standard Systems Group at Maxwell Air Force Base’s
Gunter Annex, Ala., marks the end of the line for the Air Force’s famed Desktop
contracts, which heralded widespread use of indefinite-delivery, indefinite-quantity
procurements throughout government.


Service officials deliberated for months over forgoing the IDIQ buys in favor of BPAs.


But ultimately, Air Force contracting managers decided that the change in acquisition
strategy would cut procurement costs and keep technology up-to-date.


The new policy calls for the service to negotiate BPAs for its PCs, networking and
videoconferencing equipment, servers and related services through the Information
Technology Tools (IT2) program. The policy stated that the service will use BPAs through
2004. The Commercial Information Technology Product Area Directorate will manage the
IT2 program.


Lt. Col. Glenn Taylor, CIT-PAD director, said the Air Force should be a market
follower, buying commercial products through private-sector procurement techniques.


The Defense Department mandates its own special requirements for weapons systems, in
which it is a market leader, Taylor said, but writing requirements for commercial computer
products makes no sense.


Air Force buyers will get prices as good through BPAs as they have through the Desktop
buys, Taylor said. He predicted that BPA vendor support will also be good.


“For the most part, feedback has been good from the field,” he said.


The Air Force must show strong buying commitment if it wants the most competitive
pricing, said Bob Dornan, senior vice president of Federal Sources Inc. of McLean, Va.


The Naval Space and Warfare Systems Command, for example, maintains more than 50 BPAs,
he said, and they are not a simple thing to find on SPAWAR’s Web site.


Vendors will resist giving their lowest prices if they are unsure of an agency’s
buying commitment, he said.


Another consultant, however, predicted that BPA prices will be as competitive as those
on the service’s IDIQs. “Market pressures force you to the same pricing,”
said Bob Guerra of Guerra and Associates of Oakton, Va.


Taylor said Desktop V’s supplemental BPA contractors, Dell Computer Corp. and
Micron Electronics Inc. of Nampa, Idaho, have delivered products within the continental
United States in one to two weeks and outside it generally in two weeks.


From June 1998 through Jan. 29, Dell sold $69.2 million worth of PCs, notebooks and
servers, and Micron Electronics sold $43.5 million worth.


As for the three main Desktop V contract holders, Raytheon Data Systems—formerly
known as Hughes Data Systems—sold $369.8 million from May 1996 through Jan. 29 this
year. International Data Products Corp. of Gaithersburg, Md., sold $31.7 million on
its Desktop V contract, awarded in May 1997. Dynamic Decisions Inc. of New York sold
$238,639 from January 1997 through Jan. 29 this year.


But Air Force dissatisfaction with the long-term IDIQ strategy reportedly grew when
protests halted the Desktop IV and V procurements for months. Earlier, industry sources
said, Unisys Corp. had bid so low on Desktop III that it lost money and stopped marketing
the contract.


CIT-PAD officials said they plan to issue a BPA for rugged portable computers by March
26 and set other BPAs in coming months. On Feb. 1, SSG issued requirements for a
two-year, $30 million BPA for rugged portable PCs.  



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