DoD, GSA consider new contract vehicle for commercial cloud

The General Services Administration and the Defense Department are working together on a possible new contract vehicle to help federal agencies buy commercial cloud computing services.

Nothing’s final yet, but the talks, between GSA’s Office of Integrated Technology Services (ITS) and the Defense Information Systems Agency could result in a multiple award contract solely for cloud, perhaps similar to GSA’s Networx contract, which lets agencies buy telecommunications services with pre-existing service level agreements.

“The idea, very simply is this: is cloud sufficiently defined as a market? And is it sufficiently different that, like Networx, it needs a contract that’s focused on the types of terms and conditions, the bidding and everything else you need to make it work right?” Mark Day, GSA’s deputy assistant commissioner for ITS said Wednesday at AFCEA’s annual joint warfighter IT day. “We and DISA are increasingly focusing on how we assess that.”

One reason such a contract vehicle might make sense and might be widely used is that the federal market for cloud is “maturing,” Day said. He said most agencies already have tackled basic cloud acquisitions such as the purchase of infrastructure-as-a-service to host public websites, and are now moving to more complex acquisitions which contemplate moving some legacy IT services to cloud offerings involving platform as a service- and software-as-a-service.

“Increasingly, customers are starting to do good risk analysis and no longer assuming that they have zero risk inside their own walls,” Day said. “If you looked at most risk analyses about moving to the cloud five years ago, people were saying, ‘I have no risk because I’m running the system myself, and oh my God, look at the risk I’m taking on if I move to the cloud.’ People are beginning to have a much better sense of the fact that they have risks if they’re running it and they have risks if it’s out in the cloud. The risks might be different, but the risk exists. It’s a maturing capability to think about this.”

Also, Day said, GSA’s customers now are developing more robust transition plans for cloud, including clearly plotting through how to make sure they can extract their own intellectual property from a managed service provider’s platform and move it to a new IT environment if need be.

“Some of us have heard of managed service contracts where it was great going in, but then when it was time to move to a new contract, we couldn’t do the next bid because the vendor said, ‘You told me to build you a solution, I built you a solution. I’m not going to tell you how I did it.’ People are starting to realize that when you go to software or platform as a service, your data may well be in a proprietary schema,” Day said. “When you try to go get your data out of that service, it may be in a format you don’t understand. That’s an enormous problem if we don’t plan for it. Some people have said it’s like having a prenuptial agreement for your marriage, but really, that’s what contracts are about: when we’re not happy with each other.”

Robert Foster, the Defense Logistics Agency’s deputy director for information operations, told the same conference his agency might be a prime candidate for such a contract vehicle if GSA and DISA do indeed set one up.

DLA already is DISA’s biggest customer, and has spent the past five years virtualizing all of its servers in preparation for an eventual transition to cloud computing. Some of its data will need to stay in DISA’s government-operated MilCloud environment, but the agency’s very interested in commercial cloud too.

“But our number one issue right now is contracts,” Foster said. “If I have to go out and write my own contract for software as a service or infrastructure as a service or hardware as a service, I don’t know if I’ll ever get it past the lawyers. They give me a deer in the headlights look when I start talking about things like cloud access points and intellectual property and all the things they have to deal with. So I what I need is a vehicle where I can reach industry.”

The cloud contract would not be the first time GSA and DISA have partnered on a large purchasing vehicle. As of 2012, the two agencies were operating three separate contract vehicles for commercial satellite communication services, but decided to merge them into a single contract known as CS2.

Day said the consolidation cut agencies’ average acquisition time by 12 to 24 months and reduced the prices they pay for satellite services by 34 percent. The time and savings, he said, resulted from an early example of the category management approach to contracting that GSA is now working to apply more broadly throughout its portfolios.

“We could have put plain vanilla contracts in place with commercial terms and told agencies to come use them, write your own task order, figure it out,” he said. “But we recognized there’s a fundamental problem in this business: the people who understand the requirements and the people who turn it into contracts talk two different languages. So we realized we need people who are experts in the market. They need to understand the market they’re buying in, not just how the Federal Acquisition Regulation works. They need to understand how the requirements turn into acquisition-speak that a contracting officer can then carry over the line and turn into an actual contract. We did not have that middle person, so we began to put subject matter experts in place, and it’s paid off. This is just the beginning of really changing how ITS does business.”

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