It’s become increasingly difficult to keep up with the Pentagon’s massive cloud computing deal, given all the twists and turns it has taken over the past few years. With new delays, complaints and appeals filling the news at all times, it’s hard to imagine a resolution to the contract.
The Department of Defense’s multi-year, $10 billion Joint Enterprise Defense Infrastructure (JEDI) contract will grant either Amazon Web Services or Microsoft the responsibility of transitioning sensitive military data to the cloud. The winner will be positioned to secure similar deals around the globe, while the other provider will find it nearly impossible to regain market share. The competition has created a modern-day space race between U.S. tech giants as they attempt to prove to the government and the world that they have the best science and technology. Meanwhile, the government is waging a war of its own against other major world players looking into cloud transitions, drawing attention to what the U.S. should be doing compared to China.
JEDI decision-makers pioneered the project at the slow pace that is expected of major government processes. Originally set to be awarded in September 2018, the date has been postponed for a variety of reasons ranging from personnel changes to ongoing legal trouble with Oracle.
However, the process has begun to speed up amidst mounting pressures to reach a decision. What began as a tense competition between two of the country’s largest cloud companies has instead transitioned into a space race—though this time, instead of shooting for the moon, governments are aiming for the cloud.
The Chinese government is developing its own military cloud computing system, making the Department of Defense increasingly eager to expedite its own bidding process. President Trump even weighed in on the JEDI contract for the first time this summer, indicating his plans to look at the deal more closely. The race is now political and reaching the finish line first has eclipsed other priorities.
The evolution of the JEDI contract has sparked a new line of questions. Should the U.S. be developing its own cloud system (like China)? Is it better to go with a single established provider? What are the implications of fast-tracking a major deal like this?
Could We Build Our Own Unique System?
As China works to build a system that is bigger and better than any other, many U.S. leaders might wonder why we aren’t doing the same. This concern is not unfounded. Much like China, the U.S. has the talent and ability to create their own system. So the question is: Why is China embracing a self-built cloud ecosystem while the U.S. is not?
The differing digital landscapes in the two countries means that, while a self-built system may make sense in China, it doesn’t in the U.S. In addition to catalyzing government job growth, the Chinese government likely has turned to a self-governed data center out of a desire to protect data. Because there’s political tension between China and other parts of the world, having a third-party global company—especially an American company like Amazon or Microsoft—housing their military secrets probably isn’t the most appealing approach.
With U.S.-based companies at our fingertips, and without the same security threats here, it is much more intuitive for us to seek a partnership with one of these organizations. Though it would create a massive influx of government jobs, building our own system would be incredibly costly and take more time. The economics of this deal also tie into why the DoD will be selecting a single cloud provider instead of spreading data across multiple platforms.
Why is the U.S. Choosing a Single Provider for JEDI?
The government, like the majority of private companies, is “buying in bulk” by choosing to reward a single company with the contract. Most cloud providers will offer incentives based on the length and amount of an agreement, meaning the Pentagon will be able to use the massive size of the contract to get a better deal.
A single platform may be beneficial financially, but it poses a risk as it means missing out on the unique capabilities of other providers. For example, Microsoft is known for its strengths around A.I. and disaster recovery solutions; Amazon Web Services offers different benefits such as serverless coding. Other companies already eliminated from the running also have unique selling points that the government will not be able to leverage.
Additionally, placing a single provider in charge of all DoD data will pose a huge business challenge to other powerhouses, greatly reducing their chances of increasing their market shares. By contrast, a multi-cloud ecosystem would allow the government to access benefits and strengths across a variety of platforms and avoid a technological monopoly.
Should the Pentagon Rush Their JEDI Decision?
Whether you’re a grocery store chain or a big box store, the risk with moving too quickly with digital transformation is a failure to notice mistakes before it’s too late. Major oversights can cause a business to entirely abandon a project down the line.
The difference between the DoD and a grocery chain is that, in this case, the stakes are much higher, of course, in the event the contract goes awry. Security is vital, and it is important that the government not will miss steps in the process because of political pressures driving the acceleration of the project. If security isn’t the top priority, the door to key pieces of intelligence will be left wide open for bad actors.
Who Will Win the Great Cloud Race?
Much like the space race, the cloud race will impact military efficiency and position either the U.S. or China as the top country in technology, science, and economics. The U.S. will gain a leg up on China by using Amazon or Microsoft because it will be less expensive and less risky; but by using only one provider for JEDI, the country may miss out on potential benefits of other technology companies.
Rushing the process could also cut the U.S.’s lead in the race. While crossing the finish line first is important, security must remain a top priority for the U.S. in order to have a solid system long term—and building a secure system takes time.
It’s likely that we’ll see a decision for the JEDI contract in the next few months, if not sooner. Of course, fast-tracking the decision doesn’t necessarily mean fast-tracking the project. Inevitably, even after a provider is chosen, there will be many speed bumps and curves in the road that will lead to a long implementation process. So the jury is still out on who will win the high-stakes cloud race.
Chris Smith is VP of Cloud Architecture, Unitas Global.