LegiStorm

Summary:

In September 2017, the Deputy Secretary of Defense issued a memorandum calling for the accelerated adoption of a Department of Defense (DOD) enterprise-wide cloud services solution as a fundamental component of ongoing DOD modernization efforts. As a component of this effort, DOD is seeking to acquire a cloud services solution accessible to the entirety of the Department that can support Unclassified, Secret, and Top Secret requirements, focusing on commercially available cloud service solutions, through the Joint Enterprise Defense Infrastructure (JEDI) Cloud acquisition program. DOD intends to conduct a full and open competition that is expected to result in a single award Indefinite Delivery/Indefinite Quantity firm-fixed price contract for commercial items. DOD has indicated that the minimum guaranteed award is $1 million, and that the initial period of performance is two years. The contract is expected to have a maximum ceiling of $10 billion across a potential 10-year period of performance. DOD is in the final stages of evaluating proposals, with Amazon Web Services and Microsoft remaining in contention for the contract. The Department originally expected to award the contract in August 2019. However, Secretary of Defense Dr. Mark T. Esper is reportedly currently reviewing the JEDI Cloud program, which may delay the award. Significant industry and congressional attention has been focused on DOD's intent to award the JEDI Cloud contract to a single company. Oracle America filed multiple pre-award bid protests with the Government Accountability Office, which were denied. Oracle America then filed a bid protest lawsuit with the U.S. Court of Federal Claims; the court ruled against Oracle in a July 12, 2019, decision. In filings associated with its bid protests, Oracle America alleged in part that the JEDI Cloud acquisition process was unfairly skewed in favor of Amazon Web Services through potential organizational conflicts of interest associated with three former DOD employees, each of whom was involved to greater or lesser degrees in the early development of the program. DOD investigations determined that Amazon Web Services had no conflicts of interest and established that the actions of the individuals identified by Oracle America did not negatively impact the procurement or grant Amazon Web Services an unfair competitive advantage. However, the investigations did identify individual violations of ethical standards established by the Federal Acquisition Regulation. Some industry observers contend that an initial single award appears to contradict broader federal cloud computing implementation guidance and industry best practices that stress the importance of multi-cloud solutions. Others point to the implementation approaches identified by DOD's 2019 Cloud Strategy as evidence that the Department expects the JEDI Cloud to serve certain enterprise-wide functions, performing as one component of a broader multi-cloud, multi-vendor system. Opponents of DOD's use of a single-award contract for the JEDI Cloud program have suggested that this tactic could restrict future competition for enterprise-wide DOD cloud services. Supporters of DOD's approach argue that the JEDI Cloud program's requirement for offerors to develop applications and data schema easily transferable to different platforms suggests that the Department may be equipped to migrate from any service environment developed under the JEDI Cloud contract to another such environment. Several Members of Congress have engaged the Administration to express their views regarding the JEDI Cloud acquisition program and pending contract award. The 116th Congress is considering related authorization and appropriations legislation that could shape future implementation of the program (H.R. 2740, H.R. 2500, and S. 1790).