NAICS Code 518210 - Data Processing, Hosting, and Related Services - epipeline Industry Report

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NAICS Newsletter August 20, 2015

NAICS 518210

Data Processing, Hosting, and Related Services

Government Contract and Procurement Analysis Report

Report Summary

This report, offered by epipeline, contains a brief analysis of the Federal government's procurement practices with regards to purchasing Data Processing, Hosting, and Related Services.

You will find information on the top federal government agencies that purchase these services, as well as their procurement strategy (i.e. full and open competition, set-asides and more). Finally, there is a review of the top companies that are awarded federal government contracts for Data Processing, Hosting, and Related Services.

To get a more comprehensive analysis and learn more about how epipeline can help you identify current and future bid opportunities, register for a live Demo.

This report takes an in-depth look at the 'Data Processing, Hosting, and Related Services' industry, NAICS 518210. epipeline's Contract History Plus* provides you with a broad context and several perspectives that enable you to develop the best positioning and strategy for your company to more effectively compete for government contracts. The following graph illustrates one such perspective: the top Government departments/agencies buying these services over the last four fiscal years.

Top 10 Federal Agencies by % of Total Market FY11 through FY15 for NAICS 518210


This industry comprises establishments primarily engaged in providing infrastructure for hosting or data processing services. These establishments may provide specialized hosting activities, such as web hosting, streaming services or application hosting; provide application service provisioning; or may provide general time-share mainframe facilities to clients. Data processing establishments provide complete processing and specialized reports from data supplied by clients or provide automated data processing and data entry services.

Illustrative Examples:

Application hosting

Optical scanning services

Application service providers

Web hosting

Computer data storage services

Video and audio streaming service

Computer input preparation services

Microfilm imaging services

Computer time rental

Cross References:

Providing text processing and related document preparation activities--are classified in Industry 561410, Document Preparation Services;

Providing on-site management and operation of a client's data-processing facilities--are classified in U.S. Industry 541513, Computer Facilities Management Services;

Providing wired broadband Internet access services using own operated telecommunications infrastructure, in combination with web hosting--are classified in Industry 517110, Wired Telecommunications Carriers;

Providing Internet access via client-supplied telecommunications connections in combination with web hosting--are classified in U.S. Industry 517919, All Other Telecommunications;

Operating web search portals--are classified in U.S. Industry 519130, Internet Publishing and Broadcasting and Web Search Portals;

Providing access to computers and office equipment, as well as other office support services--are classified in Industry 56143, Business Service Centers;

Processing financial transactions, such as credit card transactions--are classified in Industry 522320, Financial Transactions Processing, Reserve, and Clearinghouse Activities; and

Providing payroll processing services--are classified in U.S. Industry 541214, Payroll Services.

The size standard associated with NAICS 518210 is $32.5 million (effective January 1, 2012), which means that a company, including its affiliates, would be considered a "small business" if their average earnings do not exceed $32.5 million for each of the pay periods for the preceding completed 12 calendar months.

Total reported spending under NAICS 518210 for the period of Fiscal Year 2011 (FY11) through Fiscal Year 2015 (FY15) was $5.8 billion. Current FY15 reported spending is $996 million for services under NAICS 518210. The chart below illustrates the reported** spending by year for FY11 through FY15.

Reported Contract Spending for NAICS 518210 FY11 through FY15

Source: epipeline's Contract History Plus*


The Centers for Medicare and Medicaid Services was the largest procurer of these services for the last five fiscal years (FY11 through FY15) with $1.2 billion in contract spending, comprising 20.5% of the market for NAICS 518210. The Federal Acquisition Service took the second spot with 12.1% market share and $705 million in contract dollars, while the Department of Education ($423 million) took the third spot with 7.3% market share. Veterans Affairs ($228 million), the Department of Energy ($226 million), the Army ($217 million), the Coast Guard ($200 million), and the FBI ($187 million) each reported between 2% and 3% market share. The Bureau of Alcohol, Tobacco, Firearms, and Explosives’ Acquisition and Property Management Division ($147 million) and the Food and Drug Administration ($123 million) rounded out the top ten with 2.5% and 2.1% market share, respectively. Overall, the top ten agencies represented almost two-thirds, of 62.6%, of the market.

Top 10 Federal Agencies by % of Total Market FY11 through FY15 for NAICS 518210

Source: epipeline's Contract History Plus*


The two charts below identify the top 10 Companies, by market share, for the period of FY11 through FY15. The first chart represents the top 10 companies that were awarded their contracts under ANY type of competition, whether it was full and open, small business set-aside, sole-sourced, etc. This list primarily consists of large businesses. The second chart, however, lists the top 10 companies that won their contracts under RESTRICTED competition. Specifically, epipeline limited this to those contracts awarded under the acquisition strategies listed below. The contract dollars represented on this second chart may not include all contract dollars for the individual contractor.

  • 8(a) Competed
  • 8(a) Small Disadvantaged (SDB) set-aside
  • 8(a) sole-source
  • SDB set-aside
  • SDB, 8(a) with HUBZone
  • Combination HUBZone and 8(a)
  • HUBZone set-aside
  • HUBZone sole-source
  • Service Disabled Veteran-Owned Small Business (SDVOSB) set-aside
  • SDVOSB sole-source
  • Emerging Small Business set-aside
  • Very Small Business set-aside
  • Reserved for Small Businesses ($2501 to $100,000)
  • Total Small Business set-aside

Electronic Data Systems Corporation the top spot on the unrestricted competition list with $1.5 billion in contract dollars and 27.32% market share for FY11 to FY15. Perot Systems Government Services, Inc. took the second spot with $471.4 million in contract spending and 8.87% market share, and Cingular Wireless, LLC took the third spot with $180.1 million in contract spending and 3.39% market share. $150 million (2.83% market share) went to Lockheed Martin. Rounding out the top five, Companion Data Services, LLC, posted $146.7 million in contract dollars and 2.76% market share. In the bottom half of the top ten, Rolling Bay, LLC ($136.9 million), Applied Engineering Management Corporation ($129.5 million), Intelsat General Corporation, ($113.2 million), IBM ($88.4 million), and Buccaneer Computer Systems & Service, Inc. ($80.7 million) each earned between 1.52% and 2.58% market share. Together, the top ten spots comprised over 50 % of the market.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not be reflected in the chart below.

Top 10 NAICS 518210 Contractors by % of Total Market for FY11 through FY15 - All Acquisition Strategies

Source: epipeline's Contract History Plus*

The combined spending for contracts awarded under "restricted competition," as outlined above, totaled over $989 Million for FY11 through FY15. Five of the top ten small businesses, Rolling Bay, LLC ($136.9 million), Primus Solutions, Inc. ($69.9 Million), Turningpoint Global Solutions, LLC ($63 million), Buccaneer Computer Systems & Services, Inc. ($54.1 million), and Diamond Solutions, Inc. ($50.3 million), also achieved one of the top ten spots on the unrestricted competition list. Edaptive Systems, LLC earned $40.4 million in contract dollars with 4.08% market share. Merlin International, Inc. ($36.6 million) and Chenega Government Consulting, LLC ($34.2 million) both reported over 3% market share, with 3.7% and 3.45%, respectively. Surface Technologies Corporation ($33 million) and IQ Business Group, Inc. ($20 million) finished up the top ten with 3.34% and 2.03 %market share.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 518210 Contractors by % of Total Market for FY11 through FY15 - Restricted Competition

Source: epipeline's Contract History Plus*


68% of contract spending reported for the FY11 through FY5 timeframe under NAICS 518210 used full and open (unrestricted, aka "N/A") competition; this equated to $3.97 billion in contract dollars. Competitive 8(a) requirements accounted for 6.7% of the market and $392 million in spending, while 8(a) Sole Source requirements took 6.6% of the market with $385 million contract dollars. Small businesses were the fourth largest sector, taking 3.4% of the market with $198 million in contract dollars. Service-disabled veteran-owned small businesses ($17 million) were the fifth largest sector. 14.9% of requirements reported no clear set aside; all other strategies accounted for only .11 % of the marketplace.

Acquisition Breakout under NAICS 518210 for FY11 through FY15

Source: epipeline's Contract History Plus*


These contracts are being performed across the United States with a reported spending for the FY11 through FY15 period of $150 million.

The state with the highest total of reported contract spending was Virginia with $1.4 billion, or 23.8% market share. Maryland was a close second with $1.3 billion in contract dollars and 22.1% market share. Staying in the same geographical region, Washington, DC took the third spot with $1.1 billion in spending and 19.6% market share. California ($230 million), West Virginia ($164 million), and Kentucky ($115 million) each saw over $100 million in contract dollars. New York ($72 million), Georgia ($72 million), Illinois ($69 million), and Missouri ($65 million) each reported between 1% and 2% market share. Together, the top 10 states represented almost 80% of the market; 9.3% of requirements under NAICS 518210 did not report a specific location.

Contract Place of Performance under NAICS 518210 for FY11 through January 2011

Source: epipeline's Contract History Plus*

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