B-228385, Jan 14, 1988, 88-1 CPD 34

B-228385: Jan 14, 1988

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PROCUREMENT - Sealed Bidding - Invitations for Bids - Terms - Proprietary Information - Licenses DIGEST: Protest of solicitation requirement for software license agreement with manufacturer of computer system for which maintenance and repair services are being procured is denied. Since the record shows that the software is an integral part of the system. The solicitation is for energy control maintenance and repair services for a Honeywell Delta 1000 Energy Management System used for temperature and climate control at the VA Medical Center in Charleston. The requirement in issue is for a licensing agreement with Honeywell for the latest revision of the software for the Delta 1000 system.

B-228385, Jan 14, 1988, 88-1 CPD 34

PROCUREMENT - Sealed Bidding - Invitations for Bids - Terms - Proprietary Information - Licenses DIGEST: Protest of solicitation requirement for software license agreement with manufacturer of computer system for which maintenance and repair services are being procured is denied, since the record shows that the software is an integral part of the system, and required revisions cannot be obtained without a license agreement.

Johnson Engineering and Maintenance Co.:

Johnson Engineering and Maintenance Co. protests the requirement for a Honeywell, Inc., software license agreement, and the award of a contract to Honeywell, under invitation for bids (IFB) No. 534-05-88, issued by the Veterans Administration (VA). The solicitation is for energy control maintenance and repair services for a Honeywell Delta 1000 Energy Management System used for temperature and climate control at the VA Medical Center in Charleston, South Carolina. The requirement in issue is for a licensing agreement with Honeywell for the latest revision of the software for the Delta 1000 system, which would authorize the contractor to obtain from Honeywell and install any periodic software updates as part of the contract work. Johnson contends that the license agreement is not needed for the maintenance of the system and that the requirement therefore unduly restricts competition.

We deny the protest.

Honeywell submitted the lower bid, $28,248, of the two bids received (the other was $29,444), and was awarded the contract. Johnson did not submit a bid but filed a pre-bid opening protest with the contracting officer, who denied the protest. Johnson then protested to the General Accounting Office.

Johnson contends that, despite not being party to a license agreement, it performs maintenance work on Delta 1000 computers at other government installations throughout the United States with no complaints or problems. The VA, in response, states that any maintenance contract must ensure the complete operation of the system, and argues that software, being an integral part of the system, logically must be included in a complete maintenance and repair program. The VA also states that the acquisition of software upgrades under a separate solicitation would be impractical, time consuming and potentially costly. Because malfunctions may entail problems related to both hardware and software, the VA argues, the agency would be forced to deal with multiple contractors. In this regard, Honeywell states that if the main processor board in the system fails and replacement is required only a user who had entered into a license agreement with Honeywell would be able to obtain a replacement.

Based on the above, we conclude that the license agreement requirement was reasonable. While Johnson argues that the license agreement is not required to maintain Delta 1000 systems, the protester has not established that the system used by the VA is the same as the other systems it maintains, or shown that the maintenance it performs on other Delta 1000 systems covers both software (including no-cost upgrades) and hardware, as opposed to hardware only. In fact, if Johnson's other contracts cover both, we fail to see how the contractor obtains software upgrades, because the record clearly indicates that a license agreement is required for the acquisition of the Honeywell Delta 1000 software. See Johnson Engineering and Maintenance, B-228184, Dec. 3, 1987, 87-2 CPD Para. ***.

The protest is denied.