WASHINGTON – The US Defense Department's is poised to release a new cloud computing policy, opens the door for commercial firms to host military data and applications, and allows the services and combat support agencies to procure cloud services themselves.
Commercial data storage giants Amazon and Google are considered contenders for the business, alongside Microsoft and IBM. Amazon — a household name as an Internet retailer, but perhaps not a major player at the Pentagon — made headlines last year when it landed a $600 million contract through the CIA to build the US intelligence community's cloud computing environment over IBM.
At an industry conference here, the Amazon Web Services (AWS) vice president for public sector business, Teresa Carlson, was mum on the CIA, but touted Amazon's work for NASA and other federal agencies. Still, the company has found it challenging to surmount the Pentagon's acquisitions system and cultural reluctance to embrace cloud computing.
"People say, 'Is this cloud thing real,' that you can go into a portal and start spinning up infrastructure, 'I have to spend seven months ordering it and putting my security around it, there's no way I can get it going,' " Carlson said, speaking at the Defense One Summit on Nov. 19. "I'm like, 'Yeah, you can.' "
Cloud computing, which warehouses data and services in large groups of remote, networked servers for online access, is considered more secure, mobile and cost-effective than agencies hosting it on their own.
The policy, an update from its 2012 release, is expected to let the services and major agencies within DoD purchase approved commercial cloud services through their respective contract offices. The Defense Information Systems Agency (DISA), which was the Pentagon's cloud broker, will no longer act as the sole contracting office, but it would have approval over agencies' security plans and serve in an advisory role.
On Dec. 1, Acting Chief Information Officer Terry Halvorsen released new policy guidance, the "DoD Cloud Way Forward," which sets out how DoD will use commercial cloud computing, seen as a potential cost-saving measure.
DoD has authorized the services to engage its own contracting and more broadly define the cloud security requirements so that the Pentagon could be more open to commercial offerings, Halvorsen said.
Amazon is the sole company with DoD approval to handle higher-risk, or level 3-5, security impact data, "but there are a group of Amazon-like companies right on the verge of getting the approval," Halvorsen said.
Organizations could see a 40 percent cost savings over hosting their own data, money that could be plowed back into war-fighting — the argument Halvorsen uses to convince agencies to relinquish direct control of servers and data.
"You've got to make the economic case and then prove they can still get their data, but it's mostly about getting the money picture right," he said.
In one case, Amazon found an agency that thought it had 10 petabytes (10 million gigabytes) to store, but only needed 7 petabytes, Carlson said at an industry conference in early November.
"Government is often oversold on technology, so it's the ability to say, 'Buy what you need and pay for what you need,' " Carlson said. "We're very disruptive. ... When you buy something, you pay for it and you only use it when you need it. You turn it off when you don't need it."
DoD could be reaping even more savings, but its acquisition rules are not suited to the metered, pay-as-you-go model offered by Amazon or other cloud services firms.
"They're accustomed to firm, fixed-price contracts, so this is still a square peg in a round hole," according to Alex Rossino, an analyst with Deltek, a software and market research company.
Deltek forecasts the federal agency demand for vendor-provided cloud computing services will increase from $2.45 billion in fiscal 2014 to $6.5 billion in 2019, in part driven by DoD loosening the reins.
A separate analysis by IDC Government Insights pegged federal cloud spending for fiscal 2014 at more than $3 billion, saying it could rise to as much as $3.4 billion in fiscal 2015 and to $5.9 billion by fiscal 2018.
Though Silicon Valley could get a big piece of this pie, Rossino said he's not counting out traditional defense firms. DISA's Milcloud and Defense Enterprise Computing Centers have seen work by Lockheed Martin, among other "usual suspects," Rossino said. Booz Allen Hamilton, for example, has earned $276 million for Army cloud research and integration since 2010.
Reaching beyond DISA was a necessary step, as DISA lacked the capacity to tackle all of DoD, Rossino said.
"The door is too small for everyone to get through at DISA, but it is still important, like the spider at the center of the web," he said.
Although there was initially resistance to the idea, Halvorsen — a former Navy chief information officer — has pressed to open opportunities for private firms, beyond DISA, said Hari Bezwada, the chief information officer for the Army's PEO Enterprise Information Systems.
"Mr. Halvorsen came in and said there are a lot of people who can do things better than us, so let's find ways to take advantage of those," Bezwada said. "He's been very influential and creative because he came from the service. That's the beautiful thing about it, he brings the problems we face, he makes tactical sense, and he said, 'Listen, we've got to open it up, and be transparent.' "
The Army has launched cloud computing pilot programs with Amazon, Bezwada said, adding: "We expect to do the same thing with other vendors as they come along and get provisional [approvals] from DISA," Bezwada said.
Amazon's main competitor, IBM, is making a play for DoD business with its Cloud Managed Service data centers, on a secure campus at the Navy's Allegany Ballistics Laboratory in Rocket Center, West Virginia, built for a level 3-5 workload. Already involved in a government pilot program, IBM is obtaining a provisional authorization to operate from DISA. The facility already has a nonsecure Internet protocol router network connection, a key DISA requirement, said IBM spokesman Mitch Derman.
In June, IBM announced data centers in Dallas and Ashburn, Virginia, specifically for federal clients, part of its investment of $1.2 billion to expand cloud operations.
This week, Microsoft announced the Navy is deploying Office 365 to a first wave of 8,000 Navy reservists, providing them with new mobility options and access to the collaboration and communication tools needed to do their job. The plan is to deploy to 40,000-plus Navy reservists, enabling them to complete training, administrative and operational tasks regardless of where they are located, rather than having to be in a Navy office.
Microsoft's general manager for DoD business, Tim Solms, touted Microsoft's Azure government cloud — which hosts applications and data — its secure data centers and Office 365 suite of products. The company is seeking level 3-5 certification for Azure, though it has Azure pilot projects ongoing in each branch of the services and within various agencies, Solms said.
From the Azure cloud, troops could not only manage data but run applications to control facilities on posts, camps and stations, such as traffic control, energy and water usage. "So very non-IT things, but facilities engineering problems, really every part of the logistics chain, becomes something we could tap in and operate," Solms said.
The Navy is in source-selection for a tactical cloud system for big data, advanced analytics and data science for naval warfare planning and execution. It's essentially a research and development contract for finding ways to use cloud for big data solutions in the tactical environment, an issue that largely has confounded much of the military so far.
The other services also have voiced interest in similar cloud capabilities.
DISA is seeking commercial cloud service provider integration models, with a request for information for industry solutions that provide flexible cloud options inside the DoD firewall, core data centers or in containers. The RFI represents an early foray into commercial options for higher-sensitivity DoD data.
The Marine Corps released an RFI this year for cloud support of its Global Combat Support System-Marine Corps program.
At the heart of DoD's embrace of cloud computing is the Joint Information Environment (JIE), a framework to provide commanders with a shared, visible global network, Halvorsen said. Through the JIE's regional Joint Regional Security Stacks, individual commands will be able to monitor the entire DoD network. The first JRSS, in San Antonio, is online.
As the JIE whittles down the vast majority of its data centers, it is expected to create $2 billion in cost savings for DoD, in part through the consolidation of 1,600 firewalls DoD must synchronize over its global network, Halvorsen said.■
Amber Corrin contributed to this report.
Joe Gould was the senior Pentagon reporter for Defense News, covering the intersection of national security policy, politics and the defense industry. He had previously served as Congress reporter.
