Is GSA stuck with proprietary numbering system?

General Services Administration officials plan to begin negotiations with the owner of the Data Universal Numbering System to ease restrictions on its use, according to a letter released June 12. But the Government Accountability Office suggests that the company which owns the system -- Dun & Bradstreet -- might hold most of the cards in any changes GSA might want to make.

GSA officials have been analyzing other unique identifiers, and they expect to complete their analysis by September, Dan Tangherlini, acting GSA administrator, wrote in his letter to the Government Accountability Office.

"GSA believes that Dun & Bradstreet effectively has a monopoly that has contributed to higher costs," the GAO's letter reads. "This effective monopoly results in part from the [Federal Acquisition Regulation] requirement and [Office of Management and Budget] directives that require all contractors, grantees, and other entities seeking to do business with the government to acquire a DUNS number. GSA officials have said that as long as the FAR requirement is in place they must use the DUNS number and cannot hold a competition for unique identification numbers."

GAO released Tangherlini’s comments June 12, along with its recommendation to try to ease the parameters that Dun & Bradstreet have set around its DUNS numbers, in its letter to Sen. Ben Nelson (D-Neb.), chairman of the Appropriations Committee’s Legislative Branch Subcommittee. DUNS is used to uniquely identify businesses around the world.

The objective of GSA’s research is two-fold. They want to find alternatives to awarding another sole-source contract for Dun and Bradstreet’s proprietary identifiers, and they also are wondering whether staying with Dun & Bradstreet is a worthwhile investment, given the risks of changing systems. A key questionin the decision is the cost of switching to a new system, GAO wrote.

GSA has conducted market research and plans to conduct a cost-benefit analysis and feasibility study regarding a change. Already though, officials have concluded it’s not worthwhile to switch from one proprietary numbering system to another. So, they are also considering the advantages and disadvantages of a government-owned numbering system, or even a hybrid system.

Since 2002, GSA has increased its use of the DUNS number and business information services. The central procurement agency paid $1 million for the services a decade ago. Now it pays $19 million per year under the current contract.

The current contract for DUNS numbers is an eight-year, sole-source contract awarded to Dun & Bradstreet in 2010. The contract now totals up to $154 million, according to GAO.

It won't be easy to award another contract when this one ends though.

Dun & Bradstreet put restrictions on the use of the numbers. The company limits how the government can use the data and hinders its ability to switch to a new numbering system, GAO wrote. For instance, restrictions have hampered efforts to consider companies' links to fraud cases.

Competitors of Dun & Bradstreet say it has an unfair advantage. According to GAO, one organization noted that DUNS numbers are not subject to transparency requirements, such as Freedom of Information Act requests.

Dun & Bradstreet did not respond to a request for comment.