What you need to know
- The U.S. Department of Defense has reached out to Microsoft, Google, Amazon Web Services, and Oracle in regard to its Joint Warfighting Cloud Capability contract.
- The Joint Warfighting Cloud Capability contract replaces the JEDI contract, which was canceled after a long legal dispute.
- The Department of Defense explains that it will negotiate to award a contract to all cloud service providers that can meet the U.S. government's requirements.
Update November 22, 2021 at 4:00 pm ET: AWS provided the following statement: "Our commitment to supporting our nation's military and ensuring that our warfighters and defense partners have access to the best technology for the best value is stronger than ever. We look forward to continuing to support the DoD's modernization efforts and building solutions that help accomplish their critical missions."
The U.S. Department of Defense (DoD) expects to award several Indefinite-Delivery, Indefinite-Quantity (IDIQ) contracts to cloud service providers in the near future. These lucrative agreements would be for the Joint Warfighting Cloud Capability (JWCC) initiative that replaced the JEDI contract.
While the DoD anticipates that Microsoft and Amazon Web Services (AWS) will receive contracts, it has reached out to other cloud service providers to assess the ability of other companies to meet the demands of the Pentagon. Google, Oracle, Amazon Web Services, and Microsoft have all been solicited by the U.S. government.
"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," explains a notice from the Department of Defense. The notice later states, "the Department is still evaluating the contract ceiling for this procurement, but anticipates that a multi-billion dollar ceiling will be required. The contract ordering ceiling will be included in any directed solicitations issued to vendors."
The resulting IDIQ contracts will likely be for a period of 36 months with two additional 12-month option periods.
The DoD explains that it's only aware of five hyper-scale cloud service providers. Of those five, it believes that only AWS and Microsoft "appear to be capable of meeting all of the DoD's requirements at this time." Those requirements include providing cloud services at all levels of national security classification.
While the government only believes that AWS and Microsoft are capable of meeting the demands of the contract, it states that it will reach out to and negotiate with any vendor deemed capable of meeting the DoD's requirements.
The Pentagon soliciting several large cloud providers helps ensure that corporations cannot claim they didn't receive a fair shot at the contracts. The Pentagon scrapped a $10 billion JEDI contract with Microsoft after a long and drawn-out legal battle involving Amazon. Oracle expressed concerns regarding the JWCC contract. The new approach from the DoD helps the government illustrate that it has not excluded any companies preemptively.
