Pentagon’s new $9B cloud contract vehicle to start taking orders in next two weeks

Best listening experience is on Chrome, Firefox or Safari. Subscribe to Federal Drive’s daily audio interviews on Apple Podcasts or PodcastOne.

After a drawn-out contracting saga that lasted more than five years, the Pentagon is eager to finally implement its first-ever contracts to provide enterprise cloud computing services for the entire Defense Department. Officials said they’ll be ready to start accepting orders under the multibillion dollar Joint Warfighter Cloud Computing contracts within the next 15 days.

But the process of actually awarding work to the four vendors who won the contracts this week will take longer than Defense officials originally envisioned when they began designing JWCC. Instead of turning individual orders around within five to ten days, each new task order will likely take weeks or months to award, officials said Thursday.

That’s largely because each of the four companies — Amazon, Microsoft, Google and Oracle — will be allowed to submit individual proposals for each task order DoD solicits under JWCC. Previously, the department intended to automate the selection process for each task order by comparing each company’s prices and service offerings in a pre-populated catalog against each new requirement for cloud services, then placing an order for whichever service offering best met its needs.

The change appears to have been driven, at least in part, by a desire to achieve lower prices by allowing a more traditional competition at the task order level.

“While we have discounted pricing already within the overall construct, each of those task orders will be competed and therefore we could potentially receive even additional cost savings as we go forward,” Lt. Gen. Robert Skinner, the director of the Defense Information Systems Agency told reporters Thursday.

The department still plans to use some degree of automation in the JWCC task order process. The Account Tracking and Automation Tool (AT-AT) DISA’s Hosting and Computing Center (HACC) developed will handle some of the bureaucratic steps of actually writing and managing task orders, but the actual selection process for each order will be handled by traditional government review teams, said Sharon Woods, the HACC’s director.

“The automation will be in the building of the acquisition process, which can be a little bit cumbersome,” she said. “So as mission partners put together the different pieces of their packages, that’s what will be provided to the contractors to compete. But for the competition process itself, we’ll use evaluation teams. It includes all the subjectivity and all of the critical consideration that you would expect with a competition.”

The extent to which potential customers in the military services and Defense agencies will embrace JWCC remains unclear, especially considering that unlike its ill-fated predecessor, the JEDI Cloud contract, DoD is not mandating its use.

Each of the military services now have their own well-developed contracting vehicles to buy commercial cloud services, and officials emphasized Thursday that they see JWCC as a “complement,” not a competitor to those other contracts.

But they also believe that in addition to potentially lower prices, JWCC offers another key selling point: It is the department’s only cloud purchasing vehicle offering cloud services that are authorized to handle unclassified, secret and top-secret level data.

“None of the other contracts do it at all three security classification levels, spanning the entire enterprise, from the continental United States all the way out to the tactical edge,” said John Sherman, the DoD chief information officer. “What this also brings us is direct access to these cloud service providers without going through an intermediary or reseller. This creates a more efficient and effective leveraging of these capabilities, and it’s something we’re very excited about.”

But those classified versions of JWCC aren’t available just yet. The contracts call for each vendor to start providing secret-level services within the next 60 days, and top secret services within the next 180 days.

This week’s awards — worth a total of $9 billion over up to five years — were unusual in that rather than placing all the winning companies on a multiple-award contract, DoD chose to award each company its own single-award indefinite delivery/indefinite quantity contract. Each contract includes a three-year base period and two additional one-year option periods.

On paper, Wednesday’s contract announcements placed the ceiling value of the four contracts at $9 billion each, but Defense officials said Thursday that they would spend no more than $9 billion combined across the four contracts, and no company is guaranteed a particular amount of work beyond the $100,000 minimum specified in their contract.

JWCC was devised in 2021 as something of a short-term solution after DoD decided to cancel the single-award JEDI Cloud contract it had made to Microsoft after years of bid protest litigation. The JWCC construct, in which the department hand-picked the four vendors it invited to bid on the contracts it ultimately awarded this week, was meant to serve as a bridge until the department could conduct another full-and-open competition for enterprise cloud services.

Defense officials have previously said they hoped to start that full-and-open competition roughly one year after it made the final JWCC awards, but on Thursday, they were less committal about that timeframe.

“Based on how the [JWCC] contract is satisfying the needs, we will continue on. There will be a full and open competition at some point in the future, based on the mission requirements and where the department is at that time,” Skinner said. “If the department decided not to exercise the option years, then we would have to start a little bit earlier from an acquisition standpoint to get things set up.”

 

Copyright © 2024 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.

Related Stories

    Federal News Radio pinwheel icon

    In JWCC cloud procurement, Pentagon plans a novel approach to competition

    Read more
    GettyImages/DoD/Federal News Network

    DoD picks Amazon, Microsoft, Google and Oracle for multibillion dollar project to replace JEDI Cloud

    Read more