Navy signs Microsoft deal

Microsoft hopes that a new enterprise license that gives the Navy a discount on Microsoft software will strengthen the company's presence at Navy facilities.

The contract could span three years and be worth $11 million if all of its options are exercised. Mike Bradshaw, director of Microsoft’s defense sector, said the long term potential return is more important than the gain in the short term.

"When I put in a consolidated agreement, I ultimately lose money versus what was happening prior to that," he said. "What it does help me do though is establish a base of products that can then be leveraged into long-term growth."

It also moves Microsoft products into the Navy's command and control operations, he said. CDW-G, as Microsoft’s reseller, will provide software for 28,000 desktops and 884 servers in Navy installations outside the continental United States.

The Naval Network Warfare Command's OCONUS Navy Enterprise Network (ONE-NET) is replacing most of the Navy’s systems overseas with one network covering 16 shore installations in Europe, the Middle East and the Far East. The agreement will consolidate purchasing so that the installations will be standardized on software. Such standardization enhances security and information technology management, Bradshaw said.

"One of the big opportunities I see here is there are some new technologies from Microsoft that are going to be enabled because you bring the infrastructure up to a common level," said Max Peterson, vice president of federal sales at CDW-G. Products such as Live Meeting and SharePoint can be implemented consistently across 16 installations as a result of the standardization, he said.

The deal comes under the Defense Department's Enterprise Software Initiative, a licensing program intended to encourage aggregation of agency requirements in exchange for lower prices from vendors.