Pentagon asks Amazon, Google, Microsoft and Oracle for bids on new cloud contracts
PUBLISHED FRI, NOV 19 202111:58 AM EST
UPDATED 7 MIN AGO
Jordan Novet @JORDANNOVET
CNBC.com
KEY POINTS
-- The U.S. Defense Department expects to dole out cloud contracts to multiple companies.
-- The new push comes after Pentagon scrapped its plans for a single-vendor cloud contract for Microsoft worth up to $10 billion over a decade.
The U.S. General Services Administration said Friday that the Defense Department has solicited bids from Amazon, Google, Microsoft and Oracle for cloud contracts.
The outreach comes after the Pentagon set aside a highly contested $10 billion contract that Microsoft had won and Amazon had challenged. The value of the new contracts is not known, but the Defense Department estimates it could run into the multiple billions of dollars.
The new effort, known as Joint Warfighting Cloud Capability, or JWCC, appears like it will bolster the top providers in global cloud infrastructure, Amazon and Microsoft, although it could also provide more credibility to two smaller entities.
“The Government anticipates awarding two IDIQ contracts -- one to Amazon Web Services, Inc. (AWS) and one to Microsoft Corporation (Microsoft) -- but intends to award to all Cloud Service Providers (CSPs) that demonstrate the capability to meet DoD’s requirements,” the GSA said in its announcement.
An indefinite delivery, indefinite quantity, or IDIQ, contract includes an indefinite amount of services for a specific period of time.
The GSA said that only two U.S. cloud infrastructure providers, Amazon and Microsoft, appear able to comply with all of the Pentagon’s requirements, which include “tactical edge devices” that can operate outside of traditional data centers and support for all levels of data classification.
Amazon and Microsoft are the two companies that were the finalists for a single Joint Enterprise Defense Infrastructure, or JEDI, contract. That contract was meant to go to a single provider and was expected to be worth up to $10 billion over 10 years. Microsoft won it in 2019, Amazon filed a protest and ultimately in July the Pentagon chose to cancel the contract. Andy Jassy, currently Amazon’s CEO and previously head of AWS, argued that there was political interference in the award of the contract.
The JWCC differs from JEDI because it’s designed to have the Pentagon rely on multiple cloud providers.
The Pentagon expects each of the IDIQ contracts to have a three-year base period and two year-long option periods.
Google spokesperson Ben Jose pointed to a blog post from last week that said the company planned to pursue a bid for the military contract, noting the Pentagon is the world’s largest employer. CNBC reported Monday that executives attempted to tactfully address growing employee concern over the contract and previously established artificial intelligence principles, after employees protested against Google’s plans to bid on the JEDI contract.
Amazon and Microsoft representatives didn’t immediately respond to requests for comment. Oracle declined to comment.
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Pentagon asks Amazon, Google, Microsoft, Oracle for cloud bids (cnbc.com) |
