The Department of Defense has awarded Dell a $2.5B blanket purchasing agreement to provide the U.S. Navy with enterprise software licenses.
Under terms of the five-year deal, the technology company will provide user-based subscription licenses for products including Microsoft 365 and Microsoft Azure.
The contract award comes as the DOD transitions to DOD365, which is a higher-security version of Office365 that was purchased through the $4.4 billion Defense Enterprise Office Solutions (DEOS) contract.
The enterprise software licenses will be used by the Department of Defense and U.S. Coast Guard, and the ordering period began on June 1.
Funds will be paid through delivery orders using operations and maintenance DOD funds, although the agreement will not obligate the immediate payment of funds. Two proposals were received for the contract award.
Purchasing software has been a perennial challenge for DOD, as its contracting methods were designed for the procurement of major weapons systems rather than code-based systems that require continual updates.