Tech Group Asks Lawmakers to Release Pentagon Cloud Award Report

(Bloomberg) -- A group representing some of the tech industry’s largest companies is urging Congress to increase transparency of the Pentagon’s winner-take all competition for a broad-based cloud services contract that may be valued at billions of dollars.

The IT Alliance for Public Sector, a division of the Information Technology Industry Council (ITI), sent a letter on Monday to the House and Senate Armed Services Committees asking members to publicly release the Pentagon’s justification for choosing just one winner for its cloud services project known as the Joint Enterprise Defense Infrastructure Cloud Program.

Tech companies jockeying for a piece of the Pentagon’s business have urged the Defense Department to pick multiple cloud providers for the project, arguing that the Pentagon’s requirements unfairly favor Amazon.com Inc., the dominant cloud services company. Companies also say choosing just one company for the job will stifle innovation and raise security risks.

“The current strategy dilutes the benefits of best practices, strongly increasing the likelihood of vendor and technology lock-in, and negatively impacting innovation, costs, and security,” the group said in the letter. “Moreover, it sends an ominous signal that competitors should not invest in the public sector marketplace.”

Spending Measure

Representatives from the Defense Department and the two committees didn’t immediately respond to requests for comment. The letter, which ITI confirmed, was first reported by Nextgov, an online site focusing on technology and the federal government.

ITI’s letter refers to a provision lawmakers added to the $1.3 trillion spending bill Trump signed in March, which asked the Pentagon to deliver two reports, outlining its procurement strategy for cloud computing services and a justification for why the agency is planning to award a single contract.

The business coalition is asking Congress to publicly release those reports “to increase transparency in the acquisition process.” The Pentagon has said it would submit the reports to Congress by May 7.

The department has so far declined to release a formal justification for its single-award decision. Defense Secretary Jim Mattis told a panel of senators April 26, however, that the Pentagon’s goal is “to get the best possible service for the front line.” He denied the eventual winner has been decided.

“I’m aware that some people in industry believe this should be an equal opportunity thing where everyone gets a piece of the pie,” he said.

Oracle Campaign

Oracle Corp. is said to be leading a campaign to prevent Amazon from winning the contract, along with Microsoft Corp., International Business Machines Corp., Dell Technologies Inc. and Hewlett Packard Enterprise Co.

All of the companies, including Amazon, belong to ITAPS. Several of the companies, which have longstanding government business in legacy data systems, outlined attempts to lobby defense or appropriations committee members in the first quarter of 2018.

IBM lobbied specifically on “provisions relating to DoD cloud programs, including the Joint Enterprise Defense Infrastructure (JEDI)” in the spending bill, according to disclosures to the government.

The Pentagon has said it’s making the shift to the cloud to give it a tactical edge in the battlefield and strengthen its use of emerging technologies. The department has said it plans to issue the final request for proposal by May 15 and award the contract by the end of September.

--With assistance from Tony Capaccio

To contact the reporters on this story: Naomi Nix in Washington at nnix1@bloomberg.net, Ben Brody in Washington at btenerellabr@bloomberg.net.

To contact the editors responsible for this story: Sara Forden at sforden@bloomberg.net, Larry Liebert

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