DoD awards $59.6M AWS cloud services task order for IL 4, 5, and 6 compute and storage

Contract Overview

Contract Amount: $59,651,205 ($59.7M)

Contractor: Amazon WEB Services, Inc.

Awarding Agency: Department of Defense

Start Date: 2024-11-22

End Date: 2028-04-21

Contract Duration: 1,246 days

Daily Burn Rate: $47.9K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: TASK ORDER AWARD AGAINST JWCC MULTIPLE-AWARD IDIQ CONTRACT HC105023D0005 TO AMAZON WEB SERVICES, INC. FOR AWS SECRET IL 4, 5, AND 6 (SECRET) CLOUD COMPUTE AND STORAGE SERVICES FOR THE ENTERPRISE CLOUD MANAGEMENT AGENCY (ECMA).

Place of Performance

Location: SEATTLE, KING County, WASHINGTON, 98109

State: Washington Government Spending

Plain-Language Summary

Department of Defense obligated $59.7 million to AMAZON WEB SERVICES, INC. for work described as: TASK ORDER AWARD AGAINST JWCC MULTIPLE-AWARD IDIQ CONTRACT HC105023D0005 TO AMAZON WEB SERVICES, INC. FOR AWS SECRET IL 4, 5, AND 6 (SECRET) CLOUD COMPUTE AND STORAGE SERVICES FOR THE ENTERPRISE CLOUD MANAGEMENT AGENCY (ECMA). Key points: 1. This task order leverages the existing JWCC IDIQ contract, indicating a streamlined procurement process for established cloud services. 2. The contract is for a period of approximately 3.5 years, suggesting a medium-term need for these cloud capabilities. 3. The award to Amazon Web Services, Inc. aligns with the government's strategy to utilize major cloud service providers. 4. The fixed-price contract type helps mitigate cost uncertainty for the government. 5. The specific focus on Secret-level cloud environments highlights the sensitive nature of the data being handled.

Value Assessment

Rating: good

The award amount of $59.6 million for cloud compute and storage services over approximately 3.5 years appears reasonable given the scope and the provider. Benchmarking against similar large-scale cloud service contracts awarded by the DoD or other federal agencies would provide further context. The firm fixed-price structure offers cost predictability, which is a positive indicator for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under the JWCC (Joint Warfighting Cloud Capability) IDIQ, which itself was a result of a competitive process. However, this specific task order was awarded on a 'full and open competition after exclusion of sources' basis, implying that while the IDIQ was competed, the specific award mechanism for this task order might have had limitations or specific criteria that narrowed the field of potential bidders.

Taxpayer Impact: While the JWCC IDIQ was competitively awarded, the specifics of this task order's competition level need further examination to ensure maximum taxpayer value. Limited competition can sometimes lead to higher prices than a truly open bid.

Public Impact

The Department of the Army will benefit from enhanced cloud computing and storage capabilities. This contract delivers critical infrastructure for hosting and processing classified data at Secret levels (IL 4, 5, and 6). The services provided will support the Enterprise Cloud Management Agency (ECMA) in its mission. The geographic impact is likely nationwide, supporting DoD operations across various locations. Workforce implications may include the need for personnel skilled in AWS cloud environments and classified data handling.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with a single major cloud provider.
Ensuring robust security protocols are maintained for classified data at multiple impact levels.
Managing the complexity of integrating these services with existing DoD IT infrastructure.

Positive Signals

Leverages an existing, competitively awarded IDIQ contract (JWCC).
Utilizes a firm fixed-price contract type to control costs.
Awarded to a leading cloud service provider with extensive experience.

Sector Analysis

This contract falls within the Cloud Computing and Data Processing sector, a rapidly growing area within federal IT spending. The federal government is increasingly migrating workloads to cloud environments for scalability, cost-efficiency, and enhanced capabilities. Major cloud providers like Amazon Web Services, Microsoft Azure, and Google Cloud are key players in this market, competing for significant government contracts. The DoD, in particular, is a major consumer of cloud services, seeking to modernize its infrastructure and improve warfighter capabilities.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses (ss: false, sb: false). While the primary awardee is a large corporation, there may be opportunities for small businesses to participate as subcontractors, depending on AWS's subcontracting plans and the specific requirements of the task order. Further analysis of subcontracting goals would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight for this task order will likely fall under the purview of the Enterprise Cloud Management Agency (ECMA) and the Department of the Army's contracting and program management offices. The Department of Defense's Inspector General may also conduct audits or investigations related to contract performance and financial management. Transparency is facilitated through contract award databases like FPDS, though detailed performance metrics may not be publicly available.

Related Government Programs

Joint Warfighting Cloud Capability (JWCC)
General Services Administration (GSA) Cloud IT Services
Department of Defense Enterprise Cloud Strategy
Amazon Web Services (AWS) Government Cloud Contracts

Risk Flags

Potential for vendor lock-in
Security compliance for classified data
Integration complexity with legacy systems

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.7 million to AMAZON WEB SERVICES, INC.. TASK ORDER AWARD AGAINST JWCC MULTIPLE-AWARD IDIQ CONTRACT HC105023D0005 TO AMAZON WEB SERVICES, INC. FOR AWS SECRET IL 4, 5, AND 6 (SECRET) CLOUD COMPUTE AND STORAGE SERVICES FOR THE ENTERPRISE CLOUD MANAGEMENT AGENCY (ECMA).

Who is the contractor on this award?

The obligated recipient is AMAZON WEB SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $59.7 million.

What is the period of performance?

Start: 2024-11-22. End: 2028-04-21.

What is the track record of Amazon Web Services, Inc. in delivering cloud services to the Department of Defense, particularly for classified environments?

Amazon Web Services, Inc. (AWS) has a significant and established track record of providing cloud services to the Department of Defense (DoD) and other federal agencies. They are a primary awardee of the Joint Warfighting Cloud Capability (JWCC) IDIQ contract, which this task order is a part of. AWS offers a range of cloud services designed to meet various security requirements, including those for classified environments up to the Secret level (Impact Levels 4, 5, and 6). Their experience includes supporting large-scale deployments, ensuring compliance with government security standards (like FedRAMP and DoD Cloud Computing Security Requirements Guide), and providing robust compute, storage, and networking capabilities. Numerous other DoD components and agencies rely on AWS for mission-critical applications, demonstrating their capability and trustworthiness in handling sensitive government data.

How does the pricing of this $59.6 million task order compare to similar cloud service contracts awarded by the DoD?

Directly comparing the pricing of this $59.6 million task order to similar DoD cloud service contracts requires access to detailed pricing structures and service level agreements for comparable awards. However, the award amount, spread over approximately 3.5 years (1246 days), suggests an average annual spend of roughly $17 million. This figure needs to be contextualized by the specific services procured (compute, storage, specific IL levels) and the scale of deployment. Given that AWS is a major provider and the JWCC IDIQ was competitively established, the pricing is likely benchmarked against market rates for enterprise-level cloud services. Without specific comparable contract data, it's difficult to definitively state if it's high or low, but the firm fixed-price nature provides cost certainty for this defined scope.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks associated with this contract include potential vendor lock-in, ensuring continuous security compliance for classified data across multiple impact levels, and the complexity of integrating these cloud services with the DoD's existing IT infrastructure. Vendor lock-in can limit future flexibility and potentially increase long-term costs. Maintaining security across IL 4, 5, and 6 requires rigorous adherence to evolving DoD security directives and constant vigilance against cyber threats. Integration risks stem from the diverse and often legacy systems within the DoD. Mitigation strategies likely involve robust contract management, regular security audits and assessments, clear performance metrics, and potentially multi-cloud strategies for future procurements to avoid over-reliance on a single provider. The firm fixed-price nature also mitigates financial risk for the government.

How effective is the use of the JWCC IDIQ contract vehicle for procuring these essential cloud services?

The use of the Joint Warfighting Cloud Capability (JWCC) IDIQ contract vehicle for this task order is generally considered an effective procurement strategy for essential cloud services. JWCC was designed to provide the DoD with access to leading commercial cloud capabilities across all classification levels, aiming for speed, agility, and scalability. By leveraging an existing IDIQ, the DoD avoids lengthy, standalone procurement processes for each specific cloud requirement. This allows for faster deployment of critical capabilities. The JWCC itself underwent a competitive process, establishing a baseline for services and pricing. This task order benefits from that established framework, streamlining the acquisition and enabling the Enterprise Cloud Management Agency (ECMA) to quickly obtain the necessary AWS Secret-level cloud services.

What are the historical spending patterns for cloud services within the Department of the Army, and how does this award fit within that trend?

The Department of the Army, like the broader Department of Defense, has shown a consistent and increasing trend in spending on cloud services over the past several years. This reflects a strategic shift towards modernizing IT infrastructure, enhancing data accessibility, and improving operational agility. Historically, spending may have been fragmented across various systems and providers. However, initiatives like the JWCC and the push for enterprise cloud adoption signal a move towards consolidating and standardizing cloud usage. This $59.6 million award for AWS Secret-level services fits squarely within this trend, representing a significant investment in secure, high-impact cloud capabilities necessary for modern military operations. It aligns with the DoD's overall strategy to leverage cloud technologies for mission success.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - COMPUTE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 410 TERRY AVE N, SEATTLE, WA, 98109

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $886,173,711

Exercised Options: $59,651,205

Current Obligation: $59,651,205

Actual Outlays: $13,390,435

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HC105023D0005

IDV Type: IDC

Timeline