Pentagon calls on Google, Oracle to join AWS and Microsoft in multicloud bidding

Brief:

The Department of Defense has tapped Amazon Web Services, Google, Microsoft and Oracle to bid on the agency's multicloud contract, the General Services Administration announced Friday.
A replacement to the canceled $10 billion Joint Enterprise Defense Infrastructure (JEDI) cloud contract, the Joint Warfighting Cloud Capability (JWCC) announced in July does not yet have an associated price tag. The Pentagon anticipates a multi-billion dollar ceiling for the contract.
While the Pentagon anticipates awarding indefinite-delivery, indefinite-quantity (IDIQ) contracts to AWS and Microsoft, it will award additional contracts to cloud services providers (CSPs), so long as they meet the agency's requirements. Each IDIQ contract has a three-year baseline, with the option to extend for up to two additional years.

Insight:

For the Department of Defense, choosing cloud service providers (CSPs) to bid is a question of capabilities. While there are five U.S.-based hyperscale CSPs, only AWS and Microsoft "appear to be capable of meeting all of the DoD's requirements at this time," the GSA said.

When assessing vendors, the Pentagon is looking for: global availability and resiliency; ease of use; centralized management and control; commercial parity; elastic compute, storage and network infrastructure; advanced data analytics; security; and tactical edge devices.

IBM was left out of the Pentagon's list of hyperscale CSPs that could bid for the contract. The cloud vendor has made inroads with high-profile customers through its financial services cloud, but is not one of the top five worldwide IaaS public cloud providers.

Oracle also fails to capture a significant part of the market, instead falling into the bucket of "others" within Gartner's market share bucket. Oracle was not named a finalist in the final bidding for the JEDI contract.

In the U.S., and internationally, the market remains dominated by AWS and Microsoft, which account for 41% and 20% of the market, respectively.

The Pentagon's cloud contract has long been a battle between the two market leaders. Once awarded to Microsoft, AWS heavily contested the outcome. When the Pentagon overhauled the cloud contract, it made way for both vendors to win bids and billions in awards.

In the private sector, more companies are shifting to multicloud strategies, pivoting from single vendors to multiple providers. Gartner analyst David Smith called it an inevitable shift for organizations of any size. It allows companies to target vendors for best-of-breed services, and aligns vendors with specific workloads, as seen with Wells Fargo's multicloud roadmap.

As CSPs bid for parts of the JWCC contract, one important aspect for the Pentagon to consider is the developers available to work on the contract. Professional software developers overwhelmingly want to work with AWS, Stack Overflow data shows. Only 2% of software developers use IBM, and 1% use Oracle.