Microsoft says NSA needs to undo its $10B cloud computing contract with Amazon

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An aerial view of the NSA.
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Amazon Web Services (AWS) has been named the winner of a $10 billion cloud computing contract, called “WildandStormy,” for the National Security Agency. But Microsoft, no doubt still salty about Amazon’s successful challenge of Redmond’s $10 billion JEDI contract with the Pentagon, filed a formal bid protest with the Government Accounting Office last month. 

Microsoft says that if the NSA had properly evaluated the bids, Microsoft would have won. The GAO will decide the outcome of the protest by the end of October. The news was first reported by the trade publication Washington Technology.

The award and protest come as US intelligence agencies have been looking at overhauling their computing and storage resources over the last several years. Currently, many of the agencies’ cloud operations use so-called GovCloud products from various vendors, including Amazon’s AWS and Microsoft’s Azure. The initial move to the cloud was spurred years ago by the exponential increase in data that intelligence agencies were gathering and analyzing. That increase was outpacing the agencies’ ability to store it all in-house. AWS was an early winner and secured a $600 million contract with the CIA in 2013.

After years of using GovCloud services tailored for the intelligence community, the NSA, CIA, and Pentagon have been soliciting bids for new cloud computing contracts. In November, the CIA announced an award for its Commercial Cloud Enterprise program with a 15-year contract worth tens of billions of dollars. It was granted to AWS, Microsoft, Google, Oracle, and IBM. As different needs arise at the agency, the five companies will compete for subcontracts.

Less is known about the NSA’s WildandStormy program, though it appears to be a part of the agency’s Hybrid Compute Initiative, which blends more traditional cloud services with hardware-as-a-service (HaaS) products from “one of the bigger players,” NSA Chief Information Officer Greg Smithberger told Janes last year. It’s unclear if he was referring to AWS at the time.

The HaaS requirement stems from the fact that the NSA says some of its applications require more specialized computing. “There are some of the [network] pieces that are a little more exotic… there are pieces of this that are a little too hard to re-factor and move into a [commercial] cloud service,” Smithberger said. 

The hybrid approach would allow the NSA to offload the management of more of its operations, allowing the agency to divvy up its more traditional and more specialized storage and computing needs while still working with the same providers.

“NSA is always on all the time and running a very high capacity—it’s like a jet engine that’s wide open all the time, given the NSA requirements,” acting Department of Defense CIO John Sherman said to FedScoop. “There is nothing elastic about what goes on with the mission at Fort Meade,” he added. “The software they have in GovCloud now needs to run, in some instances, on bare metal to be able to get that extra oomph of performance off of that.”

AWS has provided cloud computing to the intelligence community for nearly a decade, giving the service a formidable advantage over its competitors. In recent years, Microsoft has made a play for those contracts by building facilities that can be accredited to handle secret and top-secret data.

But despite Microsoft’s presence in the field, AWS continues to have the upper hand. “[The NSA’s award] just reiterates that Amazon is still the cloud provider to beat across the federal government,” Chris Cornillie, an analyst at Bloomberg Government, told Nextgov. “Microsoft has come a long way and made it a two-way horse race in government, but Amazon was forming relationships and gathering security certifications a decade ago, and Microsoft is still playing catch-up.”

https://arstechnica.com/?p=1786735