Alphabet, Oracle, Microsoft, Amazon to Build Pentagon Cloud (1)

Alphabet Inc., Oracle Corp., Microsoft Corp. and Amazon.com Inc. will build the Pentagon an enterprisewide cloud system as part of a contract worth up to $9 billion.

The Joint Warfighter Cloud Capability (JWCC) contract is the replacement for the Pentagon’s scuttled $10 billion JEDI program. That contract initially went to Microsoft, though after a lengthy legal battle waged by Amazon, the DOD canceled it.

Now, Microsoft and Amazon will both lend their cloud services to the Pentagon with the addition of two new companies, Alphabet and Oracle, who were invited to bid in November 2021. The contract will be a three-year base with two option years.

The DOD announcement said each company would win a contract and earn a piece of the $9 billion total shared ceiling. The contracts come with a minimum guarantee of $100,000 for each cloud service provider, according to a DOD official.

“The approach that the Department of Defense has taken is to be able to give both its users and those running various missions the ultimate flexibility in having multiple providers and their services available to them,” Bill Rowan, public sector vice president of cloud company Splunk, told Bloomberg Government.

The DOD planned to announce its cloud partners in April but delayed the award to December “to get this right,” John B. Sherman, DOD chief information officer, told the Senate armed services panel in May.

DOD spending on cloud services has skyrocketed in recent years. The market for cloud services, as defined by Bloomberg Government analysts, reached $4.4 billion in reported unclassified DOD spending in fiscal 2022, more than doubling in growth since 2019.

JWCC will also “form the foundation to support” another major Pentagonwide effort to connect data across all branches of the military worldwide, the Joint All-Domain Command and Control initiative, according to DISA information released September 2021.

Google cleared an important hurdle earlier this week when the DOD granted the company Impact Level 5 provisional authorization, allowing its cloud environment to handle classified data.

Earlier: Pentagon Cloud Contract Aims to Enable Global Info-Sharing

With assistance from Tony Capaccio

To contact the reporter on this story: Josh Axelrod in Washington at jaxelrod@bloombergindustry.com

To contact the editors responsible for this story: Amanda H. Allen at aallen@bloombergindustry.com; Fawn Johnson at fjohnson@bloombergindustry.com