Defense Department chief information officer Terry Halvorsen made some waves earlier this year when he said he’d like to see commercial companies construct and operate data centers on DoD property. The military would provide physical and cyber security, the firms would bring the cost and scalability benefits of cloud technology.

Now, the Army is poised to try out a version of that idea. Lt. Gen. Robert Ferrell, the Army’s CIO, told an AFCEA D. C. breakfast on Friday that an upcoming pilot program will host DoD data in a privately-owned and operated data center on the grounds of Redstone Arsenal, Ala. as part of a broader effort to consolidate Army data centers in the southeastern U.S.

“It’s new territory, but we believe it’s the direction we need to go,” Ferrell said. “It’s moving away from the idea of owning and operating and looking at things as a service.”

The Army chose Redstone for the pilot because it already has several government-owned data centers in the immediate region, many of which are operated separately by various Army components for their own specific purposes at what Ferrell estimates is only a 40 percent utilization rate – something Ferrell is trying to tackle as part of the Army’s contribution to the longstanding Federal Data Center Consolidation Initiative.

But rather than collapsing them into one center still owned by the government, the Army has told its Network Enterprise Technology Command to use the opportunity ask if industry can do things better.

The Army hopes the project will help answer some of its lingering questions about the potential savings of transitioning to commercial cloud offerings.

DoD’s cloud strategy envisions a system of “cloud access points” in which military networks would peer with offsite commercial cloud services while adding government-specific cybersecurity protections. And Doug Wiltsie, the Army’s program executive officer for enterprise information systems says it remains to be seen whether such a construct will wind up being cost-effective in the end.

“Clearly the DoD CIO is making it a priority to move to private clouds that are hosted in the public space because of the belief that it will significantly reduce the cost. Personally, I want to see how those business case analyses fall out, Wiltsie said. “It’s not because industry can’t do this well, it’s because the implementation of security requirements from NSA changes the business model. There are rules that say you have to physically separate DoD’s data from everybody else’s data. That changes things like your ability to share machines and processing. And the management system has to be almost split: people working on the DoD side of that commercial data center have to be able to get a clearance. That changes a whole lot of things in the business model.”

So even though the Army has never tried the idea of a commercially-operated data facility inside a military base, it does have some allure in the sense that the costs of securing the center are somewhat of a known quantity.

“Since it’s already on an Army facility and it’s already behind our security architecture, that eliminates what it would cost us to run a cloud access point,” Wiltsie said. “We don’t know yet if the costs of that cloud access point would be big or small, but it’s something that between DISA, the Army and the Navy – which already has a cloud access point today – we’re going to gather a lot of information. The bottom line is that there are going to be a lot of commercially-operated data centers that DoD is going to point to in one way or another. We need to figure out how we’re going to do that.”

This post is part of Jared Serbu’s Inside the DoD Reporter’s Notebook feature. Read more from this edition of Jared’s Notebook.

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