DHS buys Microsoft enterprise license from Dell

DHS buys Microsoft enterprise license from Dell

The Homeland Security Department has awarded a contract to Dell Computer Corp. to purchase an enterprise license for Microsoft software, sources said.

The six-year agreement provides for a payment of between $110 million and $120 million, Dell spokeswoman Michelle Mosmeyer said. The contract covers about 144,000 users, who will receive access to Microsoft server, operating system and application software, other sources said.

'The contract is for Dell to manage the total desktop and server solution, including operating system, server and office automation software like Word,' one source said. 'Dell will also manage all upgrades, updates and patches' for the Microsoft systems, the source said. Dell will not sell hardware to DHS under the pact.

Dell will carry out the asset management of the Microsoft software, the sources said, but will not receive additional funds for managing upgrades of the software.

The department will receive a substantial cost reduction from its present software licenses by consolidating deals to buy Microsoft software, which range in scale from the Transportation Security Administration's staff of about 40,000 users to the Federal Law Enforcement Training Center's license covering fewer than 1,000, the sources said.

The department reached the agreement earlier this month, after inviting nine bidders, including GTSI Corp. of Chantilly, Va., and MarkSoft Management Resources Inc. of Canterbury, N.H., to present proposals.

The winning bidder's payoff is in knowing where the DHS users are located and other information valuable for marketing products to the department, one source speculated.

Part of the department's discount came about because of its willingness to provide the funds at the beginning of the contract. 'That is altogether different from a blanket purchase agreement,' a source said, because under BPAs the contractor only receives funds as the customer adds users to the license.

DHS plans to negotiate additional enterprise licenses with Oracle Corp. and Symantec Corp. of Cupertino, Calif., among other major software vendors, sources said (see story at www.gcn.com/22_12/outsourcing/22175-1.html).

DHS and the vendors plan to announce the agreement this week, sources said.

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