Nation & World

Pentagon kicks off a winner-take-all contest

The prize is a multibillion-dollar cloud computing contract

FILE PHOTO: An aerial view of the Pentagon building in Washington, June 15, 2005. REUTERS/Jason Reed/File Photo
FILE PHOTO: An aerial view of the Pentagon building in Washington, June 15, 2005. REUTERS/Jason Reed/File Photo

WASHINGTON — After months of scrutiny, complaints and at least one legal action, a group of Pentagon leaders sought to assure the country’s top technology companies this past Wednesday that the competition to build an internet cloud network for the Defense Department would be an open and fair competition.

Speaker after speaker in a packed hotel ballroom in Pentagon City, Va., stressed that the Defense Department needs to upgrade its often-antiquated technology as a matter of urgent national security, and they insisted the program had the attention of the agency’s top leaders.

“This is not another IT project,” Air Force Brig. Gen. David Krumm said during the meeting, known as an Industry Day. “This is going to make a difference like few things have — to get data to our war fighters when and where he or she needs it.”

“Whichever one of you wins this, am I am challenging you to bring your A-game,” he added.

Given the high stakes, the Pentagon’s plans to pick a single winner have alarmed industry officials who fear the losers could be locked out of a multibillion-dollar program for a decade or more.

“The Pentagon would never limit the Air Force to flying only cargo planes for every mission,” said Sam Gordy, the general manager for IBM U.S. Federal. “Locking the entire U.S. military into a single, restrictive cloud environment would be equally flawed.”

In a statement, Microsoft expressed disappointment that the Pentagon would be pursuing “a single cloud solution.”

“We believe the best approach is one that leverages the innovations of multiple cloud service providers,” the company said.

In a call with reporters after the meeting, Tim Van Name, the deputy director of the Defense Digital Service, said that having a single cloud provider is the best approach because having several “would exponentially increase the overall complexity.”

With several providers, the Pentagon “would have to manage the seams between the applications,” making it riskier and more difficult to manage.

He vowed it would be an open and fair competition, despite some concerns in industry that Amazon’s web services unit, which holds a $600 million cloud contract from the Central Intelligence Agency, has an advantage — “We want the best solution for the department. We have no favorites.”

Defense officials have said moving Pentagon computing systems to the cloud is a vital tenet of the nation’s strategy of staying ahead of countries such as China, which is investing heavily in technologies such as artificial intelligence.

For military leaders speaking Wednesday, it’s also about getting information more quickly to decision-makers. Much of the military’s sensitive and confidential information is locked down on systems that can’t communicate with each other.

In some cases, the computers are not even connected to the internet.

The cloud procurement “is about ensuring the women and men who fight our nations’ wars win. Period,” Krumm said. “And if you’re not prepared for that, you don’t need to be here.”

Industry Day followed months of industry speculation that might have the inside track to the contract award. The Pentagon set off a firestorm last month when it awarded a nearly $1 billion contract to a partner of Amazon Web Services to migrate agencies systems to the cloud.


After the outcry, and a legal challenge filed by Oracle, the Pentagon suddenly reversed course, announcing this week that it had dramatically scaled back the contract to the company, Herndon-based Rean Cloud. Instead of being worth $950 million, the value was slashed to $65 million, and its scope was much more narrowly defined.



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