May the force be with multiple clouds?
As the American Department of Defense ditches its JEDI cloud infrastructure contract amid legal wrangling between Microsoft and Amazon, we examine the possible implications of the decision and what might lie ahead
The US Department of Defense dropped something of a bombshell when it decided to scrap the $10 billion cloud infrastructure contract.
The JEDI, short for Joint Enterprise Defense Infrastructure, agreement has become one of the most troublesome contracts for the DoD in recent times, the deal being the subject of a legal battle between cloud giants Microsoft and Amazon Web Services (AWS).
At the time of the tender AWS held the edge over Microsoft in the cloud computing space, but since then that advantage has been eroded with the latter securing several major cloud deals.
This, according to Nick McQuire, Chief of Research, Enterprise at CCS Insight, added fuel to the fire and helped create a situation that left the DoD little option but to go back to the drawing board.
“As it dragged on and on and on, it got to a point where no one was winning,” he says. “It got to that stage where the customer, the US Department of Defense, wasn’t benefiting from the project.
“Amazon was facing mounting legal costs, and Microsoft couldn’t proceed with implementing what they were originally contracted to do. This was not an off the shelf type of deal. With a cloud contract worth $10 billion, there’s going to be a lot of customization, and there’s going to be a lot of investment input on both sides of the coin.
“Ultimately, I think the bigger issue was the fact that Bezos and Trump didn’t get on. It’s inescapable from certain viewpoints that there was influence coming from within the top of the White House.”
Officially, the Department determined that, due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI cloud contract no longer meets its needs.
Announcing the decision, John Sherman, acting DoD Chief Information Officer, said: “In light of new initiatives like JADC2 and AI and Data Acceleration (ADA), the evolution of the cloud ecosystem within DoD, and changes in user requirements to leverage multiple cloud environments to execute mission, our landscape has advanced and a new way-ahead is warranted to achieve dominance in both traditional and non-traditional warfighting domains.”
Indeed, the DoD is working on a new contract and soliciting proposals from cloud providers, with Amazon and Microsoft both likely to be involved in what is now framed as the Joint Warfighter Cloud Capability, or JWCC.
What is the JWCC?
The Joint Warfighting Cloud Capability, or JWCC, represents a series of cloud contracts that are expected to be awarded by April 2022.
It will initially be based on direct awards to fill the Department’s urgent, unmet requirement for a multi-vendor enterprise cloud spanning the entire department across all security levels, and is expected to operate for a performance period of no more than five years.
“The strategy, it appears, is to break up the original RFP into different chunks and put those components out to tender,” McQuire says.
“It marks a shift from a single provider model to looking at specific needs in certain areas, and breaking it down into smaller and, in my opinion more executable, chunks of the contract.”
The Department is eager to move on quickly. However, are there wider ramifications to this unravelling that we should be aware of?
“The JWCC aligns very much to how the market outside government is approaching cloud at this current moment in time,” McQuire says.
“What we’re seeing is very much a workload-by-workload decision, and vetting suppliers in the interest of wanting choice, wanting to manage costs, and sourcing the best of breed for that particular use case.”
Edwin Elmore, Director of Federal Sales at Versa Networks, also believes that the breaking up of the JEDI agreement reflects the wider direction of travel in the cloud sphere.
“The Department is best served by a multi-cloud strategy,” he says. “The cloud industry has quickly evolved.
“Cloud companies have continued to invest in DoD-specific services and service hardening, with their cloud services being accredited at Impact Level 4 and Impact Level 5, which provides the DoD with more vendor options.
“The future is a world of many clouds, public clouds, private clouds, and hybrid clouds. The DoD is unique in its consumption of IT resources, and the cloud is a critical component of its strategy. For example, the tactical edge is experimenting with cloud edge services disconnected from the internet.”
And the market continues to evolve at a speed that leaves customers looking for agility and flexibility with cloud vendor agreements.
The $10 billion JEDI contract could be one of the last of its kind, the sheer size and scope of the work for one party perhaps representing its most significant hurdle. Indeed, the limited flexibility offered in the original JEDI framework appears to be a key reason for the shift to an alternative approach in the form of the JWCC.
But what does this mean for vendors and how they position themselves in front of customers, especially large organisations with complex requirements such as the DoD?
“The challenge is about whether you are fit for purpose in terms of the direction of where the market is heading,” McQuire explains.
“From a customer standpoint, they will be asking if they are protected if their requirements change, or whether their original requirements are going to cover them for any potential change down the line.
“I think that’s what we’re starting to see companies get really clever about today — they want flexibility; they want flexible guarantees from their cloud providers. They may not necessarily be going in that direction at this moment in time, but they want the agility to do so. This is the major learning to be taken from the JEDI story.”
McQuire is one of many interested onlookers as the US DoD cloud story progresses into its next chapter.
With contracts expected to be awarded around April 2022, it is still too early to predict with any real certainty what the final line-up of vendors and responsibilities will look like — however, based on what we know about the major cloud players at this moment in time, speculation is already mounting.
Indeed, McQuire believes that many if not all of the largest cloud protagonists — including Microsoft, AWS and Google, along with IBM — will assume some form of JWCC contract.
“There are patterns that have emerged already,” he adds. “Microsoft tends to be the back-office solution provider of choice in the workplace via SaaS solutions like Office 365.
“You often see Google in the database, data analytics, and potentially machine learning environment operating as a form of data transformation provider. Equally, you see AWS being the preferred vendor for the migration to cloud for existing applications and from a developer tooling perspective, where developers want to build new things.
“IBM is a go-to for the traditional on-prem, hybrid type of setup — and some customers are starting to think about IBM more in a leveraging Red Hat capability context to help them with multi cloud management and orchestration as well.”
Whatever the combination of vendors the US DoD selects next year, the result will be a consortium of experts that provide the agility and flexibility needed to meet the Department’s detailed requirements.
This is critical in the eyes of Elmore, who points to the need to develop a robust zero trust approach to rolling out cloud across its architecture to better defend the country against state-sponsored adversaries.
“Operations, expertise and resources will also become a challenge,” he says. “Selecting and implementing agile solutions that reduce costs, provide advanced connectivity, ease of management, and advanced security features managed from a single pane of glass will be critical.
“Continuing to invest in legacy systems is not in the best interest of the government. The time to modernise network and security capabilities to allow a multi-cloud zero trust strategy is now.”