Air Force combines Microsoft contracts

The service has consolidated its Microsoft contracts into two enterprise-wide agreements with a value of $500 million, one of the largest deals in the company's history.

The Air Force said it has consolidated its Microsoft software contracts and support contracts into two mandatory enterprise-wide agreements with a value of $500 million over a six-year period, with the deal ranking as one of the largest contracts signed by Microsoft.

John Gilligan, Air Force chief information officer, said at a press briefing this afternoon that the two contracts will replace 38 decentralized software contracts and nine support contracts. Gilligan estimated the consolidated contracts will save the Air Force $100 million over six years, or roughtly 20 percent over existing contracts.

Under the new consolidated contracts, Dell will provide the Air Force with licenses for more than 525,000 Microsoft desktop Windows operating systems and the Office application software valued at $430 million. Microsoft will provide enterprise-wide support and services for the Air Force through a single support contract valued at $70 million.

Alan Horowitz, general manager of U.S. public sector services for Microsoft said the software and support contracts "is one of the of the largest deals we have ever done in size and scope of the number of systems." Besides Office and Windows, Horowitz said Dell would provide the Air Force with a wide range of application software, including server operating systems, Exchange e-mail and SQL database software.

The Air Force plans to develop "two or three standard configurations" for desktop computers and make such configurations mandatory, Gilligan said. That will help the Air Force make better use of the 50,000 personnel who support Air Force systems, with the savings from personnel efficiencies larger than the contract savings, Gilligan said.

Systems security, not costs, was the primary driver behind the contract consolidation and the decision to mandate configurations, Gilligan said. In an era of net-centric warfare, the Air Force must ensure its computers are interoperable, yet safe from holes which can be exploited by attackers.

Today, the Air Force receives notice of about "a patch a day" from software vendors, primarily Microsoft. Those patches must be tested and distributed by the Air Force Network Operations and Security Center at Barksdale Air Force Base, Gilligan said. While distribution of patches is already automatic, their application on individual desktops is often manual and can take months -- an unacceptable length of time, Gilligan said.

The new contracts and configuration standards will allow for automatic distribution and installation of patches, Gilligan said. He added that standard configurations will ensure interoperability.

Hardware to support the standard software configurations will come from the service's commodity contracts, which have shaved 25 percent of the Air Force $200 million annual desktop and laptop bill, Gilligan said.

Air Force officials have had discussions with Defense Department officials about applying the standard configuration approach through DOD, Gilligan said. He believes the rest of the military will go that route in a matter of months.

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