CIA Awards Multi-Billion Cloud Contract To Leading Cloud Vendors


This week, the Central Intelligence Agency (CIA) awarded a multibillion-dollar commercial cloud enterprise (C2E) contract to five cloud providers, including Amazon, Microsoft, Google, IBM, and Oracle. Can the multi-vendor approach stall legal battles and pace digital transformation initiatives?

Ever since the inception of cloud computing, the U.S. government has spent billions of dollars on improving IT services within its intelligence community (IC), which comprises 17 agenciesOpens a new window , including CIA, DoD, NSA, and army intelligence. The IC has made lucrative deals with commercial cloud vendors, which has reduced technology gaps and ushered the community agencies into a new digital transformation era. 

On November 20, 2020, the Central Intelligence Agency (CIA) awardedOpens a new window its long-awaited multibillion-dollar commercial cloud enterprise (C2E) contract to five major cloud titans, including Amazon, Microsoft, Google, Oracle, and IBM. The deal will deliver cloud computing capabilities such as data storage, computing, data analytics, and other services such as machine learning to CIA and other 16 agencies of IC for the next 15 years. Reportedly, the cloud contract could be worth tens of billions of dollars.

CIA spokeswoman Nicole de Haay toldOpens a new window Nextgov, “We are excited to work with the multiple industry partners awarded the intelligence community (IC) commercial cloud enterprise (C2E) cloud service provider (CSP) contract and look forward to utilizing, alongside our IC colleagues, the expanded cloud capabilities resulting from this diversified partnership.”

Also Read: Public Cloud Spending To Grow 18.4% in 2021: Gartner

CIA: The Early Adopter of Cloud Technology

In the intelligence community, the CIA was the first to implement cloud technology within its IT system. However, the CIA’s journey to cloud had a couple of legal challenges. In mid-2012, the CIA released a draft request, which was met with protests from Microsoft and AT&T. Soon, the CIA reworked its draft request, and in 2013, it awarded a $600 million cloud contract to AWSOpens a new window to build a private cloud for the entire intelligence community. 

This was dubbed as the biggest win for the cloud titan. 

Within a month, AWS’s rival IBM filed a complaint with the Government Accountability OfficeOpens a new window (GAO) against the CIA’s evaluation of proposals and selection decisions. Eventually, the CIA took corrective action and reopened the bids with AWS and IBM, which stirred Amazon to file a legal complaint against GAO’s decision to reopen the bids for IBM. 

In October 2013, Judge Thomas Wheeler of the U.S. court of federal claims ruled in favor of Amazon.

Also Read: Debunked: 3 Myths Holding Businesses Back from Moving To the Cloud

Why Did the CIA Opt for Multi-Cloud Providers?

After seven years, the CIA wanted to update its IT infrastructure with the latest cloud and emerging technologies. CIA’s strategic decision to partner with multi-cloud vendors could help IC leverage each cloud provider’s strengths. In February 2020, John Sherman, principal deputy CIO in the Pentagon, explained IC’s move to a multi-cloud model for C2E. 

He saidOpens a new window , “We recognize too that over the past six or seven years, we’ve now gotten to a point in our enterprise where we’re ready not only to move to a different type of ecosystem, but the mission demands it — that we are ready to move to an environment where we can use best-athlete capabilities.

“Having potentially more than one vendor that brings different strengths on things like [artificial intelligence] and [machine learning] and different workloads and database management, all these kinds of different pieces going together to where, as an officer at one of the agencies, you can say my workload may run best in this cloud.”

It is also assumed that CIA’s decision to opt for multi-vendor stems from the on-going controversies and lawsuits around DoD’s $10 billion JEDI military cloud contract, which was recently awarded to Microsoft over Amazon. The litigation around such high-profile deals delay digital transformation efforts and affect rapid innovations in IC. Supposedly, the CIA wanted to deflect legal battles and expedite cloud transformation initiatives across IC.

Holger Mueller, a principal analyst at Constellation Research, tweeted his perspective on the CIA multi-billion-dollar cloud contract.

@CIAOpens a new window Awards Secret Multibillion-Dollar #CloudOpens a new window Contract –

MyPOV – Much smarter by the CIA to go #MultiCloudOpens a new window (and selections) than the DoD was. Bids across @ASWCloud @AzureOpens a new window @GoogleCloudOpens a new window @IBMCloudOpens a new window and @OracleCloudOpens a new window . #NextGenAppsOpens a new window a new window

— Holger Mueller (@holgermu) November 21, 2020Opens a new window

The winning companies also celebrated their victories.

An AWS spokesperson saidOpens a new window , “The company is honored to continue to support the intelligence community as they expand their transformational use of cloud computing. Together, we’re building innovative solutions across all classification levels that deliver operational excellence and allow for missions to be performed faster and more securely.”

A Microsoft spokesperson saidOpens a new window , “We look forward to providing the intelligence community our latest unique and differentiated Azure cloud and productivity capabilities.”

Google’s spokesperson told Bloomberg GovernmentOpens a new window , “We’re proud to have been named a vendor for the commercial cloud enterprise contract (C2E).”

With an ecosystem of multiple cloud vendors, the CIA aims to develop an integrated, interoperable cloud system underpinning emerging technologies, including AI and machine learning. The intelligence agency also aims to fend off any possible legal challenges and fast track the cloud transformation efforts across the U.S. intelligence community.

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