BNUMBER:  B-277133 
DATE:  September 4, 1997
TITLE: EMC Corporation, B-277133, September 4, 1997
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Matter of:EMC Corporation

File:     B-277133

Date:September 4, 1997

Carolyn G. Hyde for the protester.
Lynn W. Flanagan, Esq., Department of Agriculture, for the agency.
David Ashen, Esq., and John M. Melody, Esq., Office of the General 
Counsel, GAO, participated in the preparation of the decision.

DIGEST

Protest that agency improperly issued delivery order for noncompliant 
direct access storage devices (DASD) system is denied where, although 
compliance with stated storage capacity and access time requirements 
could only be determined with certainty once DASD system was installed 
and used in the processing of the agency's particular data mix, agency 
reasonably determined that quoted system complied with the 
requirements.

DECISION

EMC Corporation protests the issuance of a delivery order to 
International Business Machines Corporation (IBM) against its General 
Services Administration (GSA) Federal Supply Schedule contract.  The 
purchase order was issued on the basis of responses received to 
request for quotations (RFQ) No. 00-97-1012, issued by the Department 
of Agriculture for direct access storage devices (DASD) for the 
agency's National Information Technology Center (NITC).  EMC asserts 
that IBM's proposed DASD system does not satisfy two salient 
characteristics set forth in the solicitation.

We deny the protest.

The RFQ requested pricing for a DASD system, comprised of items 
available on GSA schedules, which would provide storage with "a 
minimum guaranteed capacity of 720 gigabytes (GB) of data" and an 
"[a]verage response time of 10 ms [milliseconds] or less for any data 
set under all conditions (e.g., during data recovery, volume rebuild 
or reconstruction)."  As noted by Agriculture prior to closing, 
however, respondents were not required to offer 720 GB of actual, 
physical storage, but instead could meet the requirement with a 
virtual storage system that used data compression techniques that 
permitted 720 GB of data to be stored in a system of lesser physical 
capacity.  Specifically, the agency was asked:

     Does 720 Gigabytes refer to the physical, or virtual capacity of 
     the DASD storage subsystem?  If an offeror uses data compression 
     to provide larger user capacity on a lesser amount of physical 
     capacity, what compression ratios should be assumed?  Is all of 
     the data to be stored on the proposed data storage subsystem 
     compressible, or is any of the data already compressed before 
     being written to the storage subsystem such as . . . DB2 . . . , 
     etc.?

In its written response furnished to potential respondents, 
Agriculture stated that:

     The 720 Gigabytes refers to virtual capacity, with the capability 
     to store 720 Gigabytes of data presently stored on IBM 3390-3 
     DASD. [Emphasis in original.]

     NITC does not intend to specify a compression ratio to be used 
     here.

     There will be some data (e.g., DB2) stored on this equipment that 
     is already compressed.

The RFQ required vendors to guarantee the actual performance of their 
systems as follows:

     The offeror guarantees that any DASD subsystem furnished as a 
     result of this RFQ will meet or exceed the minimum performance 
     level specified above, for any data stored on the DASD subsystem.  
     The Government will monitor the performance of the subsystem(s) 
     for a period of 120 calendar days from the date of installation. 
     . . . 
 
     Should the subsystem fail to meet the required performance level, 
     the offeror will provide, at no additional cost to the 
     Government, any additional equipment necessary to meet the 
     specified performance level. . . .

EMC asserts that IBM's proposed system failed to comply with the RFQ 
requirement for a minimum storage capacity of 720 GB.  IBM proposed 
its model 9393 RAMAC Virtual Array Storage Model 2 DASD system, which 
the descriptive literature included in its quote described as 
employing built-in compression and compaction algorithms to provide an 
effective disk storage capacity of up to 726 GB, depending on the 
particular configuration of capacity increments selected.  In its 
specific response to the specifications, IBM stated that it 
"guarantees that the one (1) RAMAC Virtual Array which is provided 
will have a minimum capacity of 720 gigabytes (GB) of data in the 3390 
format.  A conservative compression ratio has been used to determine 
that the RAMAC Virtual Array will have a minimum capacity of 720 GB."  
However, IBM described the three standard storage increments which it 
proposed by reference to their standard denominations in the 
descriptive literature:  "420 GB EFF. CAP."; "EFF. CAP. INCREMENT-210 
GB"; and "EFF. CAP. INCREMENT-80 GB."  Noting that the capacities of 
the increments as described in the descriptive literature totaled only 
710 GB, EMC contends that IBM's proposed system is noncompliant with 
the 720 GB storage capacity requirement.

An RFQ leading to the issuance of a delivery order under an FSS 
contract must provide for a fair and equitable competition, and 
issuing an order for items that deviate from requirements set out in 
an RFQ may, at least in certain circumstances, be improper.  L.A. 
Sys., Inc., B-276349, June 9, 1997, 97-1 CPD  para.  206 at 3-4.  In this 
case, however, we need not consider whether circumstances existed that 
might permit the agency to issue a delivery order that deviated from 
the RFQ terms, since we find that the agency reasonably determined 
that IBM's proposed solution satisfied both of the RFQ requirements at 
issue.

First, the agency reasonably determined that IBM's proposed "virtual" 
storage system met the storage capacity requirement.  In our view, 
EMC's focus on the nominal capacity of the proposed storage increments 
simply ignores the nature of compression as used in a "virtual" DASD 
system.  Agriculture and EMC agree that "virtual" storage subsystem 
capacity is difficult to verify until the system is deployed because 
the actual storage capacity depends upon such things as the proposed 
compression algorithm and how "compression friendly" the data is.  
Here, IBM's descriptive literature for the specific model 9393 RAMAC 
Virtual Array Storage Model 2 DASD system it quoted reported "typical 
compression ratios of 2:1 for cache and 3.6:1 for disk storage which 
are used to calculate effective cache and storage capacities," but 
noted that "[g]reater ratios have also been observed for both cache 
and disk."  IBM, apparently drawing upon its knowledge of NITC's data 
requirements as acquired in the course of serving as NITC's DASD 
supplier for more than 6 years, in effect guaranteed a disk 
compression ratio of 3.65:1 (so as to achieve the guaranteed overall 
virtual storage capacity of 720 GB).  Although slightly higher than 
the typical 3.6:1 compression ratio upon which the nominal 710 GB 
storage capacity of the quoted components was based, this minimal 
increase was not inconsistent with IBM's descriptive literature, which 
noted that greater than 3.6:1 ratios had been observed, nor with the 
experience of large system customers such as Agriculture, which, 
according to the agency, have experienced compression ratios as high 
as 5:1.  In these circumstances, where the actual storage capacity of 
the quoted system can only be determined in operation using actual 
Agriculture data, the record indicates that the minimal increase in 
compression ratio--relative to that typically encountered with the 
proposed DASD system--which was necessary to furnish the required 
capacity was not unlikely, and the resulting contract included a 
mechanism by which any shortfall in the guaranteed system performance 
will be remedied at no additional cost to the government, Agriculture 
reasonably determined that IBM's guarantee of an overall 720 GB 
storage capacity satisfied the specification's storage capacity 
requirement. 

Second, EMC asserts that IBM's proposed system failed to comply with 
the RFQ requirement for an "[a]verage response time of 10 ms 
[milliseconds] or less for any data set under all conditions."  EMC 
bases its assertion on IBM sales literature downloaded from the 
Internet which indicates a minimum random access time of 11.2 
milliseconds for a model 9393 Model 002 RAMAC Virtual Array Storage 
system--apparently the model quoted by IBM--with a 290-GB capacity 
when processing the most difficult, "cache hostile" data.  

We find EMC's position to be unpersuasive, as it appears to be based 
on an unsupported, unwarranted assumption as to the actual data 
processed by Agriculture.  Specifically, Agriculture reports that its 
typical work load is not "cache hostile" in its entirety.  In this 
regard, the agency calculates from the data cited by EMC, that even if 
as much as 75 percent of its data were "cache hostile," and the 
remainder were in the next most difficult category ("cache uniform," 
with a minimum random access time of 5.9 milliseconds), the overall 
minimum random access time would be only 9.875 milliseconds.  Indeed, 
Agriculture notes that it is currently experiencing an access time of 
slightly less than 10 milliseconds using equipment which was installed 
in 1989 and is at least two generations out-of-date.  EMC has failed 
to demonstrate that, given the actual data processed by Agriculture, 
the agency acted unreasonably in concluding that IBM's quoted DASD 
system would satisfy the access time requirement for any data set 
likely to be encountered by the agency.[1]

The protest is denied.

Comptroller General
of the United States

1. EMC also objects that, after issuance of the delivery order, IBM 
proposed and Agriculture agreed to the substitution of IBM's newer, 
better performing model 9393 RAMAC Virtual Array Storage Model (Turbo) 
T42 DASD system for the model 9393 RAMAC Virtual Array Storage Model 2 
DASD system originally quoted.  EMC's objection, however, concerns the 
administration of an existing contract, which is not for consideration 
under our bid protest process.  4 C.F.R.  sec.  21.5(a) (1997).  In any 
case, even if the substitution had occurred prior to issuance of the 
delivery order, under FAR  sec.  52.215-10, which was incorporated into the 
RFQ, a procuring agency may accept a late modification of an otherwise 
successful offer where, as here, that modification results in terms 
more favorable to the government.  Human Resource Sys., Inc.; Health 
Staffers, Inc., B-262254.3 et al., Dec. 21, 1995, 96-1 CPD  para.  35 at 9 
n.3.