Primes compete for sales against booming skeds

Prime contractors and product vendors are gearing up for the final sales push on the federal government's major PC and workstation buying vehicles as the peak buying season enters its final month.

The government's information technology suppliers are completing what likely will be their last technology-refreshment moves this fiscal year by adding servers and notebooks to their contracts. The maneuvering sets the stage for the first prime-time collision between traditional indefinite-delivery indefinite-quantity contracts and the booming General Services Administration schedule.

Overall sales on IDIQ contracts are holding their own thus far according to industry executives who said vehicles such as the National Institutes of Health's Electronic Computer Store and the Army's Portable-1 are seeing solid buying activity. However sales on GSA schedule contracts are up sharply - as much as 30 to 40 percent more than last year executives said.

"The schedule is growing faster than anything else " said Steve LeCompte vice president of IDC Government Market Services. He said schedule sales increased by a third for the first half of fiscal 1996 adding that third-quarter data is not yet available. In comparison IDIQ contracts historically have grown at an annual rate of about 10 to 15 percent.

Relative Strengths

IDIQ contracts remain popular with buyers such as the Army and other large agencies with structured procurement policies. But the schedule has emerged as a viable second source for agencies with IDIQ pacts. And for agencies such as the Department of Veterans Affairs which is between IDIQ vehicles the schedule has become a primary source of equipment.

But the GSA schedule advances have not gone completely unchecked. Dendy Young chief executive officer of Government Technology Services Inc. said the rise in schedule sales has been "muted by competition GSA is experiencing from other vehicles." He cited NIH's Electronic Computer Store as one such vehicle. GTSI is one of NIH's contractors as well as the top Schedule B/C reseller.

Gary Newgaard manager of federal sales and marketing at Compaq Computer Corp. said a clear picture of whether GSA schedules or IDIQs have gained the upper hand will not emerge "until we've counted all the dollars in both buckets. It's a watershed year. People are changing their buying patterns."

Contractors Refresh Technology

Among IDIQ contracts the following are seeing significant technology-refreshment activities: the Army's Small Microcomputer II held by Telos Corp. the Navy's New Technology for Office and Portable Systems (NTOPS) held by BTG Inc. and Cordant Inc. and the Navy's PC LAN+ held by Electronic Data Systems Corp.On SMC II Telos recently added Dell Computer Corp.'s PowerEdge XL servers which feature 166 MHz Pentium chips. The servers which can handle up to four processors are priced at $7 569 for a base configuration featuring one processor 32M of RAM and a 2G hard drive. Telos also has added Dell's PowerEdge WS (Web Server) to the contract according to a Telos spokeswoman. Prior to the upgrade Zenith Data Systems had been the sole server provider on SMC II.

Dell's appearance on SMC II is the company's first role on a major Defense Department IDIQ contract. Dell has sold to DOD through the GSA schedule but "we never had a good vehicle to get our foot in the door " said Rocky Mountain a manager for federal government marketing at Dell.

On EDS' PC LAN+ contract Compaq Computer Corp.'s Proliant 5000 is the server of choice."There is a fairly significant demand for a rack-mounted Proliant for not just shipboard but office [applications] " said Peter Buck EDS' PC LAN+ program manager. EDS added the Compaq server in its last technology-refreshment wave.

Meanwhile BTG last week added 166 MHz and 200 MHz Pentium desktops from ZDS to its NTOPS contract. The new products join 75 MHz and 133 MHz desktops already on the contract.

"I'm optimistic that we'll have a big year end on the contract " said Steve Baldwin BTG's vice president of business development.

Notebooks also are popular and a number of contract vehicles are adding them. BTG has placed Compaq's Armada 4130T on NTOPS and EDS plans to add the Armada 4120T to PC LAN+ as soon as this week.