The Pentagon on Wednesday announced a five-year, $9.69 billion agreement to consolidate Microsoft (MSFT) and other enterprise software licenses used across the military services, intelligence community and U.S. Coast Guard into a single contract vehicle, Reuters reported.

The agreement, called the Core Enterprise Technology Agreement, is intended to reduce duplicative spending and simplify fragmented software procurement across the Defense Department.

Reuters reported the deal combines existing spending on Microsoft 365 subscriptions, cloud services and on-premises software licensing, allowing the Pentagon to use its broader purchasing power to negotiate lower costs.