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You are here: Home / Enterprise I.T. / HP Wins NASA IT Services Contract
HP Wins $2.5 Billion NASA Contract for IT Services
HP Wins $2.5 Billion NASA Contract for IT Services
By Jennifer LeClaire / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
Hewlett-Packard got a belated Christmas gift this year. NASA awarded the tech giant's enterprise services division a 10-year Agency Consolidated End-user Services (ACES) contract worth up to $2.5 billion.

The contract is a firm fixed-price deal with indefinite delivery and indefinite quantities. The initial term of the contract is four years, with two three-year option periods.

NASA personnel now support NASA's core business, scientific, research and computational activities. HP Enterprise Services will provide, manage, secure and maintain these essential IT services for the agency. Specifically, NASA will outsource management of its personal-computing hardware, agency-standard software, mobile IT services, peripherals and accessories, and other infrastructure to HP.

Long-Term Competitor

HP beat out Lockheed Martin for the project. "Our team is disappointed that NASA selected another solution," Sheila Collins, a spokesperson for Lockheed, said in an e-mail to Bloomberg. "We submitted a 'best-value' solution based on our knowledge of the program and our understanding of NASA's mission. We continue to serve NASA on other contracts."

But HP and NASA also have a longer-term relationship. HP first inked a deal with NASA in 2007. At that time, HP won a seven-year contract worth up to $5.6 million to provide personal computers, printers and other hardware to federal agencies through NASA's Solutions for Enterprise-Wide Procurement program.

"This is a 10-year agreement, which is about as long of term as I have seen. For large, diversified IT providers like HP, it is not uncommon to have annual IT share of wallets in the $200 to $250 million levels, especially for a large governmental agency," said Al Hilwa, an analyst at IDC. "Of course we are talking about NASA here, which is a huge consumer of technology -- we are talking about rocket science, after all."

HP's Winning Streak

HP is on a winning streak this December. The company announced earlier this month that SHI International selected HP Networking solutions as the network infrastructure for its new Infrastructure as a Service Cloud Center. The value of that deal was not disclosed.

Also in mid-December, Hewlett-Packard GmbH and E.ON IT GmbH, the IT and telecommunications provider for Europe's utilities company E.ON AG, inked a five-year $1.4 billion infrastructure outsourcing services contract. E.ON is one of the first major European utility companies to outsource its technology infrastructure.

Other December deals include BP and TOPS. HP Enterprise Services UK announced that BP signed a five-year outsourcing agreement valued in excess of $400 million. HP will deliver consistent global data-center services that let BP standardize and consolidate its hosting services and leverage cloud computing.

In a smaller but still significant deal, HP Enterprise Services announced TOPS Friendly Markets, the New York-based supermarket chain with stores in New York and Pennsylvania, has signed a seven-year applications and infrastructure services contract valued at more than $80 million.

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