MAY 29, 2026 – The War Department announced yesterday a five-year agreement to purchase Microsoft Services — a move expected to save the department $422 million annually.
“The Department of War is taking a definitive step forward to advance our digital infrastructure to deter near-peer adversaries by awarding a five-year, $9.7 billion Core Enterprise Technology Agreement to Dell Federal Systems,” said Kirsten A. Davies, DOW chief information officer. “This second-generation blanket purchase agreement will streamline and consolidate critical Microsoft software and services across the Department of War, the intelligence community and the U.S. Coast Guard.”
The agreement provides the department with access to Microsoft 365, advanced cloud subscriptions and critical on-premises licensing; it’s the department’s largest to date.
“This CETA acts as part of the digital connective tissue essential for Combined Joint All-Domain Command and Control … this ensures our warfighters have the tools for just-in-time data sharing, supports our pivot to [artificial intelligence] and data analytics, and undergirds uninterrupted operational continuity for our most sensitive and disconnected environments,” Davies said.
Previously, across the department, dozens of separate contracts provided services to the same groups who will now receive the services under a single enterprisewide contract. The consolidation of contracts ensures service members and department civilians continue to have access to the same services, but now those services will cost less and save taxpayer dollars.
“This enterprise approach is not just about capability, it’s also about delivering on [Secretary of War Pete Hegseth’s] promise to be responsible stewards of the American people’s resources — taxpayer money,” Davies said, noting that the new agreement is not new funding.
Because the new contract and old contracts are with the same vendor, the funding does not change; the transition will be seamless for those involved.
“We are achieving unprecedented scale and cost efficiency,” Davies said. “This blanket purchase agreement is expected to save the department an initial $422 million annually, a figure we actually expect to rise as we fully consolidate our IT services.”
The new contract also allows warfighters to focus on what matters, she said.
“This puts the tools in a warfighter’s hands, where they need them,” Davies said. “They don’t need to worry about an enterprise software capability — they can worry about warfighting. They can focus on the mission, and we focus on the tools to support them in the mission.”
The agreement is scheduled to begin June 1 and includes Microsoft products such as Windows Enterprise Operating System and Office Professional Plus, along with cloud and hybrid capabilities. It also provides the digital foundation for Combined Joint All-Domain Combined Command and Control, the overarching concept to link sensors, weapons and decision-makers, as well as seamlessly share data across the armed forces and with coalition partners.
By C. Todd Lopez
Pentagon News