JA19-201_Unisys_OS_2200_-_FBO__Redacted.pdf

JUSTIFICATION FOR

OTHER THAN FULL AND OPEN COMPETITION (OTFAOC)

Federal Acquisition Regulation (FAR) Part 6, Justification & Approval (J&A), Supporting Procurements under FAR Part 12 and FAR Part 15

Purchase Request Number: To be determined (TBD) Contract Number: TBD Procurement Title: Unisys Operating System (OS) 2200 Capacity Services Estimated Value:

Statutory and Regulatory Authority: 10 United States Code (U.S.C) §2304(c)(1) and FAR 6.302-1

JUSTIFICATION FOR OTFAOC

OTFAOC Number: JA19-201

Upon the basis of the following justification, I, as Head of the Contracting Activity (HCA), hereby approve the use of other than full and open competition of the proposed contractual action, pursuant to the statutory authority of 10 U.S.C. §2304(c)(1) and regulatory authority of FAR 6.302-1, only one responsible source and no other supplies or services will satisfy Agency requirements.

1. REQUIRING AGENCY AND CONTRACTING OFFICE:

Requiring Agency:

Defense Information Systems Agency (DISA) Services Directorate (SE) Overcash Avenue, Building 12 Chambersburg, Pennsylvania 17201

Contracting Office:

DISA/Defense Information Technology Contracting Organization (DITCO) Scott/PL8413 2300 East Drive Scott Air Force Base, Illinois 62225

2. NATURE/DESCRIPTION OF ACTION(S):

a. The nature of this action is to procure Unisys OS 2200 Capacity Services for DISA SE.

This acquisition will continue to provide DISA SE with Unisys OS 2200 Capacity Services currently being provided under contract number HC1028-15-D-0003, which expires on November 30, 2019. This procurement will provide DISA SE the ability to supply Unisys OS 2200 Capacity Services to the current mission partner base, in excess of 92,000 users worldwide, utilizing Unisys OS 2200 applications that provide critical support to the warfighter. The scope of this effort will provide a complete managed service that includes flexibility and scope of services sufficient to meet current and future Unisys OS 2200 environment workloads, security, training, and modernization requirements, while ensuring DISA customers receive uninterrupted, continuous access to their applications and data. The recommendation is to execute a sole source

Unisys OS 2200 Capacity Services-JA19-201

Page 3 of 8 Pages including finance and accounting services for the DoD and military services. All of the Government-developed applications are tightly integrated with the Unisys OS software, with lines of local code created and incorporated. Sustainment of automation support for these applications can only be accomplished through continued use of the proprietary software supplied by Unisys, for which current user applications were developed. Unisys is the only source with in-depth knowledge about the executive and application software that makes up the Unisys OS 2200 environment. This combination of proprietary script software and in-depth knowledge of the environment is critical to the successful management of the Unisys OS 2200 Environment Capacity Services. Only Unisys has such knowledge. This background and knowledge is critical to ensure continuity of uninterrupted support for DISA SE.

b. Justification.

(1) Minimum Government requirements.

The contractor must provide all Unisys OS 2200 software, hardware (processing, storage, and internal communications), technical support, and maintenance required to run, monitor, and manage DISA SE’s Unisys OS 2200 environment, which includes:

(a) All storage (physical and/or virtual) capacities supporting the Unisys OS 2200 environment and applications running in the Unisys OS 2200 environment.

(b) All DISA-designated peripheral open system server environments that provide direct/integrated management, monitoring, or control of Unisys OS 2200 environments and applications running in the Unisys OS 2200 environment.

(c) All data replication capacity for processor, disk, and storage (virtual and/or physical) for the Unisys OS 2200 systems located in Datacenters St Louis, Ogden, and Oklahoma City.

(d) Unclassified and classified environments.

(2) Proposed sole source contractor.

The proposed sole source contractor is Unisys, and they are the original equipment manufacturer (OEM) for the Unisys Dorado mainframe servers and Unisys OS 2200 software that make up DISA’s Unisys OS 2200 environment. The hardware and software are proprietary, and Unisys is the only source from which they can be obtained, licensed, or supported. Based upon market research, there are no other commercially available product lines with similar functionality which would fit within the DISA-established network infrastructure.

(3) Discussion regarding cause of the sole source situation.

The Unisys Dorado mainframe servers and Unisys OS 2200 software that make up DISA’s Unisys OS 2200 environment are part of the Unisys’ Clearpath product line.

Both the hardware and software are proprietary, and Unisys is the only source from which they can be obtained, licensed, or supported. No other reseller or dealer can

Page 4 of 8 Pages offer the ClearPath product line to DISA SE, so no other reseller or dealer can meet the DISA SE Unisys OS 2200 Capacity Services specific requirements.

(4) Impact.

The need for this environment is completely mission partner driven, as Unisys OS 2200 is the environment required for their applications to run. If this acquisition is not approved, the current Unisys OS 2200 environment (with a historical investment value of approximately over the past 15 years) will have to be replaced. The cost to the Government to introduce a new managed service contractor would result in stoppage of existing work upon current contract expiration. Significant time and funding has been expended to implement the managed service into this environment, and the cost to convert to different software architecture would be prohibitive. For that reason, it is imperative that DISA continue to use Unisys OS 2200. In addition to financial and labor already invested into Unisys, an extensive amount of technical expertise has been developed by Unisys through development, testing, and deployment to multiple customers and warfighters worldwide. This experience and knowledge base would be lost if required to convert to a different architectural environment. Unisys is the only source that can fulfill this requirement without substantial duplication of cost to the Government that is not expected to be recovered through competition, significant costs expended on technical reviews, business cases, functional replacements of installed inventory, training, and implementations of new products. This would also result in millions of dollars and time spent by our mission partners to rewrite their applications to be compatible with another OEM’s product line. Unisys is the only source that can provide the required proprietary hardware and software to fulfill this requirement. Also, Unisys is the only source that can provide the necessary technical support for the local code required for the mission partner applications to be compatible with the commercial version of the Unisys OS 2200 software within the SE infrastructure.

6. FEDBIZOPPS ANNOUNCEMENT/POTENTIAL SOURCES:

A synopsis for this requirement, along with a redacted justification OTFAOC, will be published to FedBizOpps website, as required by FAR 5.2.

7. DETERMINATION OF FAIR AND REASONABLE COST:

A determination will be made by the contracting officer that the order represents the best value to the Government, as defined in FAR 2.101, and results in the lowest overall cost alternative (considering price, special features, and administrative costs) to meet the Government's needs.

The contracting officer will determine that the resulting contract prices will be fair and reasonable, based on comparison with the prices outlined below. The contracting officer will also determine the pricing information valid for comparative purposes. Certified cost and price data is not required for this commercial item acquisition, in accordance with FAR 15.403- 1(b)(3). The contracting officer will determine whether the price is fair and reasonable based on:

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a. Comparison of the proposed prices to historical and existing prices paid, whether by the Government or other than the Government for the same or similar items.

b. Comparison with competitive published price list and published market prices of the same commodities.

c. Comparison of proposed prices with the independent Government cost estimate.

8. MARKET RESEARCH:

a. Market research on this requirement began with examining the current Unisys OS 2200 requirements. Market research was conducted between September 2018 and February 2019 by DISA SE. Market research included performing market surveillance by searching Federal supply schedules, Government-wide acquisition contracts, internet searches, and contacting Unisys directly. The required Unisys software products have proprietary features and a custom operating environment found only in this brand name software. Unisys, the OEM, is the sole provider of Unisys OS 2200 software products. A letter from Unisys states, “As the OEM, Unisys is the only source from which the proprietary hardware and software may be obtained, licensed, or supported.”

b. The first step in market research was to determine if another brand name solution meets DoD’s need. Initial product research was conducted through the use of websites, contacting the contractor directly, and hands-on knowledge of available software. The viability of a contractor’s product was based upon the product’s ability to fulfill the DISA SE mission partner applications specifically written to run in the Unisys OS 2200 environment. These applications require custom local code containing Unisys proprietary code to be compatible with the commercial version of the Unisys OS 2200 software within the DISA SE infrastructure. Unisys is the only vendor able to provide support to update and maintain DISA SE’s local code. Based upon market research, there were no other commercially available product lines with similar functionality that would fit within the DISA-established network infrastructure.

c. The final step in conducting market research was to determine a method of procurement.

Market research revealed that Unisys is the sole provider of maintenance support services related to their suite of software products. Market research also revealed that there are authorized resellers or dealers on the General Services Administration Schedules or National Aeronautics Space Administration Solutions for Enterprise-Wide Procurement that can offer only hardware maintenance for Unisys OS 2200 servers and/or professional IT services for Unisys OS 2200 software. However, the authorized resellers are not able to offer the hardware, software, and technical support required to meet the requirements of the Unisys OS 2200 Capacity Services Contract. In the previously mentioned letter from Unisys, dated January 30, 2019, it states, “Unisys has, in some limited cases, executed contracts with other companies authorizing them as a reseller of the ClearPath product line. These reseller agreements are restricted to specific commercial accounts and geographies while strictly prohibiting the resell of the ClearPath product line to Federal, State, or Local Governments.” Since no other reseller or dealer can offer the ClearPath product line to DISA SE, no other reseller or dealer can meet the DISA SE Unisys OS 2200 Capacity Services specific requirements.

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From SE’s constant surveillance of the market throughout the life the current Unisys OS 2200 Capacity Services contract and corporate experience, we can state that:

(1) Not owning and maintaining assets results in lower costs for DISA, as DISA does not pay outright for the full price of the hardware and maintenance; the cost is for the capacity of the Unisys OS 2200 environment used. If workload is decreased, capacity is decreased.

Hardware is vendor-owned and returned to the vendor. If DISA purchases the asset, there is the risk that the workload may decrease before reaching the maximum return on investment.

(2) The software is proprietary; therefore, upgrades and code changes are only available from Unisys, because they own the source code. The Unisys Message Center develops and maintains this local code and transfers this code to the commercially available product with each OS upgrade. This support will be necessary in this acquisition as well. Since Unisys is the sole owner of this local code and the OS 2200 source code, Unisys is the only vendor that can provide this service. Also, only Unisys can offer the ClearPath product line to SE.

9. ANY OTHER SUPPORTING FACTS:

None.

10. LISTING OF INTERESTED SOURCES:

To date, no vendors other than Unisys are an interested source. No other sources can provide the requirement.

11. ACTIONS THE AGENCY MAY TAKE TO REMOVE OR OVERCOME BARRIERS

THAT LED TO THE EXCEPTION TO FULL AND OPEN COMPETITION:

a. If Unisys elects to surrender their legal ownership, copyright, and/or intellectual property software rights and move toward a complete open source solution, then DISA will seek a competitive acquisition approach. Regardless, the Government will continue to search the marketplace. If the Government should determine that the Unisys products are no longer required, the Government will seek competition for the required functionality.

b. Procurement history:

Contract Number: HC1028-15-D-0003 Brief Description: Unisys OS 2200 Managed Services Contractor: Unisys Business Type: Large Business Life Cycle Contract Value:

Period of Performance (including all options): December 1, 2014 through November 30, Basis of Award: FFP/Sole Source Previous protests/Congressional inquiries: None

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Contract Number: HC1028-10-C-2003 Brief Description: Unisys OS 2200 Capacity Services Contractor: Unisys Business Type: Large Business Life Cycle Contract Value:

Period of Performance (including all options): December 1, 2009 through November 30, Contract Number: HC1013-05-D-2001 Brief Description: Unisys OS 2200 Managed Services Contractor: Unisys Business Type: Large Business Life Cycle Contract Value:

Period of Performance (including all options): December 1, 2004 through November 30,

12. REFERENCE TO THE APPROVED ACQUISITION PLAN (AP):

A written combined acquisition strategy/AP is required and is being routed concurrently for approval.

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