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Updated July 16, 2019
DOD’s Cloud Strategy and the JEDI Cloud Procurement
In September 2017, the Deputy Secretary of Defense issued
that is designed to create a cloud-based replacement for
a memorandum calling for the accelerated adoption of a
certain DOD software applications—or on-premises cloud
Department of Defense (DOD) enterprise-wide cloud
solutions, such as the Defense Information Systems
services solution as a key component of ongoing DOD
Agency’s milCloud 2.0, to be used in limited situations
modernization efforts. Accordingly, DOD is seeking to
where the General Purpose cloud is “not capable of
“acquire a[n] … enterprise cloud services solution that can
supporting mission needs.”
support Unclassified, Secret, and Top Secret requirements,”
based on commercially available cloud service solutions,
The JEDI Cloud Program
through the Joint Enterprise Defense Infrastructure (JEDI)
DOD issued its Request for Proposals (RFP) for the JEDI
Cloud program. The Department is in the final stages of
Cloud on July 26, 2018; the RFP closed on October 9,
evaluating proposals and anticipates announcing a contract
2018. DOD has completed its initial downselect from
award decision in August 2019. DOD requested $61.9
proposals submitted by offerors, with Amazon Web
million in funding for the JEDI Cloud acquisition program
Services and Microsoft remaining in contention for the
for Fiscal Year (FY) 2020. Significant industry and
contract.
congressional attention has been focused on DOD’s intent
to award the JEDI Cloud contract to a single company.
Contract Structure
DOD is conducting a full and open competition that is
Background
expected to result in a single award Indefinite
Broadly speaking, cloud computing refers to the practice of
Delivery/Indefinite Quantity (ID/IQ) firm-fixed price
remotely storing and accessing information and software
contract for commercial items. DOD has indicated that the
programs on demand, instead of storing data on a
minimum guaranteed award is $1 million. The contract has
computer's hard drive or accessing it through an
a maximum ceiling of $10 billion across a potential 10-year
organization’s intranet. This practice relies on a cloud
period of performance. Under an ID/IQ contract, the
infrastructure, a collection of hardware and software that
government is only required to purchase the minimum
may include components such as servers and a network.
amount specified in the contract, and may ultimately choose
Cloud infrastructure can be deployed privately to a select
not to reach the contract ceiling. The contract period of
user group, publicly through subscription-based commercial
performance is structured as a 2-year base ordering period,
services available to the general public, or through hybrid
with 3 additional option periods, for a potential total of 10
deployments that combine aspects of both private and
years (see Table 1).
public cloud infrastructure. As of mid-2018, DOD reported
maintaining more than 500 public and private cloud
Table 1. Anticipated Period of Performance
infrastructures that supported Unclassified and Secret
requirements. DOD has been critical of its current cloud
Performance Period
Timeframe
services implementation, describing them as
Base ordering period (2 years, guaranteed)
2019-2021
“decentralized” and creating “additional layers of
complexity” that impede shared access to common
Option #1 (3 years, if exercised)
2021-2024
applications and data across the department. DOD has also
acknowledged that its prior lack of “clear guidance on
Option #2 (3 years, if exercised)
2024-2027
cloud computing, adoption, and migration” has led to
Option #3 (2 years, if exercised)
2027-2029
“limited capability … and inefficient acquisitions that
cannot take advantage of economies of scale.”
Source: JEDI Cloud RFP, “Combined Synopsis/Solicitation for
Commercial Items.”
DOD’s Cloud Strategy
JEDI Cloud Source Selection Process
DOD publicly released its Cloud Strategy in February 2019.
DOD has indicated that it intends to award the JEDI Cloud
The strategy described plans to extend cloud computing
contract to the offeror whose proposal meets specified
services across the Department through developing a
“multi
requirements and represents the best value to the
-cloud, multi-vendor … ecosystem composed of a
General Purpose and [multiple] Fit For Purpose”
government, based on a two-step evaluation process. In the
clouds.
first step, offerors were evaluated against seven “sub-
DOD anticipates that the JEDI Cloud acquisition program
factor” performance-based criteria. Offerors’ proposals
will ultimately lead to a foundational enterprise-wide
were deemed acceptable or unacceptable for each
General Purpose cloud suitable for the majority of DOD
individual sub-factor as considered sequentially. A
systems and applications. DOD envisions Fit For Purpose
judgement of unacceptable for any sub-factor immediately
clouds as task-specific clouds—such as the ongoing
disqualified a proposal from further consideration. If a
Defense Enterprise Office Solutions acquisition program
proposal received a mark of acceptable for each sub-factor,
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DOD’s Cloud Strategy and the JEDI Cloud Procurement
it proceeded to the second phase of the source selection
after the Secretary of Defense submits (1) a plan to
process, where it was then evaluated against five additional
establish a DOD-wide budget accounting system for funds
technical factors, together with the offeror’s price
requested and expended for cloud services, as well as funds
proposals, to determine a competitive range of offerors.
requested and expended to migrate to a cloud environment;
Qualifying offerors were next evaluated against two
and (2) a detailed description of DOD’s strategy to
additional factors: the offeror’s approach to meeting small
implement enterprise-wide cloud computing to the
business participation goals and a demonstration of the
congressional defense committees.
proposed solution’s capabilities.
Proposed Legislation
Industry Reactions
Section 1035 of S. 1790, the Senate-passed version of the
DOD’s acquisition strategy sparked resistance from many
FY2020 NDAA, would specify that the DOD CIO and the
commercial cloud vendors and industry observers who
DOD Chief Data Officer, in consultation with the J6 C4 &
opposed DOD’s intent to award the contract to a single
Cyber Directorate of the Joint Staff and the DOD Chief
company. Oracle America and IBM both filed pre-award
Management Officer, must develop and issue DOD-wide
bid protests with the Government Accountability Office
policy and implementing instructions regarding the
(GAO) against the JEDI Cloud solicitation. GAO denied
transition of data and applications to the cloud.
Oracle America’s protests and dismissed IBM’s protests.
Oracle America then filed a pre-award bid protest lawsuit
H.Rept. 116-84, which accompanies H.R. 2968, the House
with the U.S. Court of Federal Claims; the court ruled
Appropriations Committee-reported version of the FY2020
against Oracle America in a July 12, 2019, decision.
DOD appropriations act, highlights the committee’s
questions regarding DOD’s pursuit of a “single vendor
In filings associated with its bid protest lawsuit, Oracle
contract strategy” for the JEDI Cloud procurement.
America in part alleged that the JEDI Cloud acquisition
Accordingly, the House Appropriations Committee would
process was unfairly skewed in favor of Amazon Web
direct that no funds may be obligated or expended to
Services through potential organizational conflicts of
migrate data and applications to the JEDI Cloud until the
interest associated with three former DOD employees, each
DOD CIO provides a report to Congress expanding on the
of whom was involved to greater or lesser degrees in the
Department’s plans to transition to a “multi-cloud, multi-
early development of the program. Two of these individuals
vendor” cloud environment. The DOD CIO would also be
were subsequently employed by Amazon. DOD
directed to submit quarterly reports on the Department’s
investigations determined that Amazon Web Services had
cloud adoption and implementation strategy.
no conflicts of interest and established that the actions of
the individuals identified by Oracle America did not
Considerations for Congress
negatively impact the procurement or grant Amazon Web
Some industry observers contend that an initial single
Services an unfair competitive advantage. However, the
award appears to contradict broader federal cloud
investigations did identify individual violations of ethical
computing implementation guidance and industry best
standards established by the Federal Acquisition Regulation
practices that stress the importance of multi-cloud solutions.
(FAR), which directs government procurement activities to
Others point to the implementation approaches identified by
be “conducted in a manner above reproach,” and for
DOD’s Cloud Strategy that indicate the Department expects
government employees to strictly avoid “even the
the JEDI Cloud to serve certain enterprise-wide functions,
appearance of a conflict of interest in Government-
performing as one component of a broader multi-cloud,
contractor relationships.” These findings were reportedly
multi-vendor DOD cloud system. Opponents of DOD’s use
referred to the DOD Inspector General for further review.
of a single-award contract for the JEDI Cloud program have
suggested that this tactic could restrict future competition
Congressional Activity
for enterprise-wide DOD and cloud services. Supporters of
Enacted Legislation
DOD’s approach argue that the JEDI Cloud program’s
Section 1064 of P.L. 115-232, the FY2019 National
requirement for offerors to develop platform-agnostic
Defense Authorization Act (NDAA), requires the DOD
applications and data schema suggests that the Department
Chief Information Officer (CIO) to conduct specified
may be well equipped to migrate from any service
enabling activities to support DOD’s cloud adoption
environment developed under the JEDI Cloud contract to
initiative and to submit a report detailing the current status
another such environment.
and anticipated implementation of DOD’s cloud adoption
initiative. The section also established a limitation on the
Other Resources
obligation or expenditure of 15% of the authorized FY2019
funds for the initiative until the required report’s
DOD Cloud Strategy, available at https://go.usa.gov/xy2Wm
submission. Section 1064 also required the Deputy
Secretary of Defense to “ensure that the acquisition
CRS Products
approach of the Department continues to follow the [FAR]
CRS Insight IN10990, The DOD’s JEDI Cloud Program, by Heidi
with respect to competition.”
M. Peters
Section 8137 of P.L. 115-245, which provided FY2019
DOD appropriations, prevents the obligation or expenditure
of FY2019 funds to “migrate data and applications to the
Heidi M. Peters, Analyst in U.S. Defense Acquisition
proposed [JEDI] ... cloud computing services” until 90 days
Policy
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DOD’s Cloud Strategy and the JEDI Cloud Procurement
IF11264
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