IVAS: Microsoft Award By Army Worth Up To $21.9B

UPDATE that contract is “IDIQ-like” WASHINGTON: The Army awarded Microsoft a five-year contract to produce a militarized version of its HoloLens augmented reality goggles. With options to extend for another five years and a maximum potential value of $21.88 billion, the award is a major vote of confidence in a program whose 2021 funding Congress cut by $230 million.

The Integrated Visual Augmentation System (IVAS) contract was awarded last Friday but announced today by both the Army and Microsoft. The $21.88B figure was in a Microsoft email, not in either announcement. There was no minimum figure given, but the Army is determined to buy IVAS for its frontline infantry in spite of congressional skepticism.

IVAS is important – and Congress is skeptical – because the goggles are an ambitious effort to combine multiple high-tech tools in a single package light and rugged enough for a soldier to wear on their face in combat:

• targeting cross-hairs linked wirelessly to a smart gunsight on the user’s weapon;
• a heads-up display of tactical data like pointers to objectives, friendly units, and threats;
• live video downloads from drones, helicopters, ground vehicles, and other sensors, allowing troops to scope out a situation before they arrive;
• simulated enemies and weapons fire, superimposed on real terrain, for training exercises;
• live uplinks to artificial intelligences to help identify and report priority targets;
• other features, often added by Army soldiers and Microsoft coders coming up with ideas that surprise their superiors.

Early versions of IVAS didn’t work in the rain – but those were simply modified civilian HoloLens devices. The version the Army’s actually buying is ruggedized for battlefield use. Are they ruggedized enough? That’s what the Army will have to prove in testing before Congress approves any further funding, let alone $21.9 billion. The Army’s acquisition chief for soldier gear, Program Executive Officer – Soldier Maj. Gen. Tony Potts, has emphasized the crucial importance of earning Congress’s trust.

UPDATE We asked the Army if this was an Indefinite Quantity/Indefinite Delivery (IDIQ) contract, where the government and contractor set general terms without specifying a specific amount to purchase or timeline to purchase it on. An Army spokesperson replied that it was “IDIQ-like,” which is a little mystifying. Here’s their full statement for those more versed in contracting arcana than us:

On March 26, 2021, the U.S. Army awarded a fixed price production agreement to Microsoft for the production of the Integrated Visual Augmentation System (IVAS), W91CRB-21-9-P002. The production agreement has a five year Indefinite Delivery/Indefinite Quantity (IDIQ)-like ordering period for production of IVAS systems, associated components, and spares, as well as PMO, Engineering, and Contractor Logistics Support (CLS). Additionally, the production agreement has five one year options for CLS. The total potential period of performance is 10 years (5 year base and 5 year option), with a potential agreement ceiling of $21.88B.