ESRI becomes the first software vendor to participate in the General Services Administration (GSA) SmartBuy program. SmartBuy is a GSA initiative to better manage software purchases by the US Government while bringing significant savings to federal agencies. As originally conceived, the SmartBuy program will sign licenses with vendors for software that agencies can then buy. The theory is that these enterprise licenses will allow agencies to consolidate purchases, thereby allowing the government to take advantage of its buying power. Vendors have balked, though, for reasons that range from concerns about sales volumes to worries that certain companies will become the de facto government standard and lock out competitors.

In the arrangement with ESRI, each agency that wants to use the GIS software must negotiate its own enterprise agreement with the vendor, for both immediate needs and needs for the following four years, according to Kathy Beasley, GSA's contracting officer for ESRI. That gives the vendor a guaranteed volume over five years. The SmartBuy agreement adds an additional discount over the GSA schedule price.

GSA made the ESRI deal with three agencies that already use the company's software and are immediate participants in the SmartBuy program. The Agriculture Department, Census Bureau and Interior Department can use the license now, while the National Security Agency, the Environmental Protection Agency and the National Geospatial-Intelligence Agency plan to join soon.
The ESRI agreement will provide a potential cost savings of $57 million during the life of the contract when compared to nonvolume purchases using the General Services Administration's schedule contracts, GSA officials said.
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