US Department Of Defense Signs $617 Million Enterprise License Agreement With Microsoft


US Defense Department has announced a joint enterprise license agreement for Microsoft products worth $617 million for a period of over 3 years. As a result, all the Defense Department users can avail Microsoft Office 2013, SharePoint 2013, Windows 8 and Windows Server products as well. Microsoft is committed to making sure that the technology within the agreement has a mobile-first focus, and DOD expects to begin to take advantage of Microsoft’s mobile offerings as part of our enterprise mobility ecosystem.”

Read full press release below.

Press Release:

WASHINGTON, Dec. 28, 2012 – The Defense Department has leveraged the buying power of more than two million information technology users to award a three-year, $617 million joint enterprise license agreement for Microsoft products, defense officials announced.

The deal, led by the Army Contracting Command in collaboration with the Defense Information Systems Agency, the Army and the Air Force, demonstrates the best pricing DOD has received to date for Microsoft desktop and server software licenses, officials said.

“There’s a move afoot throughout the department to bring about efficiencies in the [information technology] world,” David L. DeVries, DOD deputy chief information officer, told American Forces Press Service. “We took a long, hard look at it … realizing that the Department of Defense relies upon the network and upon information technology to do its business.”

Under the agreement, the Army, Air Force and DISA can begin using the newest versions of Microsoft products, including Microsoft Office 2013, SharePoint 2013 and Windows 8, officials said, adding that Office 2013 provides enhanced security and content management tools.

The package has been customized to meet the specific security needs of the Defense Department.

“How do we bring about better effectiveness for the warfighter, better improved security on the networks … while reducing the cost of ownership?” DeVries asked. “We are the largest corporation out there, comprised of four military services. … No one comes close to our scale, so when we talk about something that produces a standardized way of buying, installing and maintaining [enterprise software], that’s a huge deal.”

Department officials estimate savings could run into tens of millions over the course of several years through lower license and software assurance costs, officials said.

“This effort is a significant pathfinder on how to do major contract awards for the Department of Defense,” said Air Force Lt. Gen. Michael J. Basla, Air Force CIO and chief of information dominance. “This contract award culminates over a year’s worth of great teaming between the Air Force, Army and DISA, and ultimately the Air Force will see a cost avoidance of about $50 million a year.”

Michael E. Krieger, Army deputy CIO, said the Army will save more than $70 million each year for the span of the agreement.

“The Army Contracting Command negotiated terms that met the complex technical and security requirements for Army, the Air Force and DISA in a single agreement,” Krieger said. “The spirit of collaboration between the services enables unprecedented opportunities for improvements in efficiency and productivity for DOD and the Army is proud to have led the effort.”

Navy Rear Adm. David G. Simpson, DISA’s vice director and senior procurement executive, also expressed confidence in the joint venture, noting overall savings of more than 10 percent for the life of the agreement.

“[The agreement] gives us a good way of bringing the volume of the government’s purchase to bear and reducing the time and effort that Microsoft needs to spend negotiating across the government,” Simpson said. “Bottom line: lower price for greater value.”

The admiral also explained that the license advances DOD’s continued focus on mobile computing.

“[The agreement] recognizes the shift to mobility,” Simpson said. “Microsoft is committed to making sure that the technology within the agreement has a mobile-first focus, and we expect to begin to take advantage of Microsoft’s mobile offerings as part of our enterprise mobility ecosystem.”

Officials said the agreement also provides software assurance benefits which will offer Army organizations additional training and consulting services.

DeVries said standardization and predictability have been vital to reducing and controlling costs and ultimately improving DOD’s ability to securely share information.

This deal and future ventures will enable DOD to work with a variety of vendors to develop products that meet acceptable security standards while enabling the organizations to have as much flexibility and capability as possible, he said.

“Improved effectiveness for the warfighter [and] improved security of our networks and information systems while reducing the total cost of ownership … these tenets are the basis of what the department is under way on now to achieve the joint information environment,” DeVries said.

Source: DOD

  • sri_tech

    Great news. Go Miscrosoft!!!

    • Bnlknlk Kofi Baiden


  • Bnlknlk Kofi Baiden

    Nice, now if only Balmer could give me just 1 million dollars, I’ll be a very happy person.

    • Kitab

      Santa’s back in hybernation…

  • blackhawk556

    if this deal doesn’t get windowsphone entrenched in the government, nothing will.

    • wp77

      MS sees the longterm potential of deals like this. Hopefully they will prevail just like they did with xBox…

      • blackhawk556

        I hope they do but well see how things play out

        Sent from my Windows Phone

  • Luis

    No mention of Windows Phone on this deal. It’s really sad, and huge missed opportunity

    • iamtiger

      When they say “[The agreement] recognizes the shift to mobility” trust me they’re talking phones and tablets…

    • Eric Hon

      I think the “mobility” part is really more tablets than phones, but the door isn’t completely closed yet on that opportunity. However, RIM might make some noise again.

      • TheOne2125

        DOD will not sign major deals with companies on the brink of collapse.

  • RoadOfMajor

    now the department of defense has a new weapon in their arsenal. the blue screen of death.

    • TheOne2125

      DOD has always been with MS for a few years they tried Android and like just about every other government in the world. They realized that it is a unsecure mess best left to the consumers who don’t really understand what they are getting in to.

    • grs_dev

      @RoadOfMajor:disqus You’re so witty!
      Hey at least if they need support they’ll get it from a company that knows how to support their VIP clients.

  • Jim Spignardo

    That’s huge! Surprised they didn’t go with Google Apps/Gmail….LOL

  • Rikkirik Contrera

    Great news for Microsoft, bad news for Apple and Google who do not really have a complete and integrated enterprise offering. Believe me when I say this also includes smartphones and tablets. And even if it doesn’t it will come naturally, because Integration and synchroinisation across devices is what drives windows 8.