The Pentagon today announced a limited bid for a new cloud computing initiative that replaces the canceled $ 10 billion, decade-long JEDI contract initiative. You may (or may not) remember that he previously launched a win-win deal that he dubbed JEDI (short for Joint Enterprise Defense Infrastructure). The new initiative bears the much less catchy name, Joint Warfighting Cloud Capability or JWCC for short.
Under the tender, Amazon, Microsoft, Google and Oracle were invited to bid. This multi-vendor approach is significantly different from the JEDI tender where only one vendor would win the award. In fact, the Pentagon is making it clear that if it favors Amazon and Microsoft, any of the qualified (invited) vendors could get a share of this deal.
As the RFP states, “the government plans to award two IDIQ contracts – one to Amazon Web Services, Inc. (AWS) and one to Microsoft Corporation (Microsoft) – but intends to award to all vendors cloud services (CSP) that demonstrate the capability to meet DoD requirements.
It appears to have limited the number of vendors involved because after studying its requirements, the Pentagon discovered that there were a limited number of companies capable of meeting them. “The market research indicates that a limited number of sources are able to meet the Ministry’s requirements. Currently, the Department is aware of only five hyperscale CSPs (cloud service providers) based in the United States. Additionally, only two of these hyperscale CSPs – AWS and Microsoft – appear to be able to meet all DoD requirements at this time, including providing cloud services at all levels of national security classification.
The government is still working on the price of this one, but with several vendors involved, it’s entirely possible that it will exceed the $ 10 billion price tag of the now defunct JEDI contract. “The Department is still evaluating the contract cap for this procurement, but anticipates that a multi-billion dollar cap will be required. The limit on contract orders will be included in all directed solicitations issued to suppliers.
It should be noted that each company that wins an award under the terms of the tender will be awarded a three-year contract for their part with two one-year option periods.
JEDI was mired in controversy from the start as the major cloud providers struggled to position themselves, and the smaller ones tried to get in on the act as well. There have been many tragedies, complaints to the president, complaints from the president, complaints of presidential interference, formal investigations galore and several trials. In the end, while everyone believed Amazon would win the auction, it doesn’t. Microsoft did.
But that wasn’t the end, and the two companies scrambled for the decision, ending up in court, of course. Eventually, the Pentagon got bored of it all and decided to abandon the project altogether.
That didn’t mean, however, that the military’s requirement to modernize its computer systems was gone because the contract had done so. That’s why today, the Pentagon announced the new initiative to bring technological modernization involving cloud infrastructure back to the forefront.
It should be noted that, according to Synergy Research, according to third quarter earnings reports, the top three vendors – Amazon, Microsoft and Google account for 70% of the market share. Amazon leads the cloud infrastructure market with 33% market share, Microsoft follows with around 20% and Google is third with 10%. Oracle is in the low numbers, according to Synergy.