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GovWin Recon - July 23, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Health IT:

Big Data / Analytics:

Transparency and Performance:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Legislation:

Mergers and Acquisitions:

State and Local:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free! 

 

GovWin Recon - July 22, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Health IT:

Big Data / Analytics:

Transparency and Performance:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Mergers and Acquisitions:

State and Local:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

Cloud Spending on the Army’s Four Largest Task Order Vehicles

Here at Federal Industry Analysis we crunch a lot of data.  For me this data crunching has recently focused on determining spending on cloud goods and services on four of the Army’s largest multiple award IT contract vehicles.  These vehicles are Information Technology Enterprise Solutions - 2 Services (ITES-2S), Information Technology Enterprise Solutions - 2 Hardware (ITES-2H), Strategic Services Sourcing (S3), and Rapid Response - Third Generation (R2-3G).  Awards for follow-ons to some of these vehicles are pending (i.e., ITES-3H), while competitions for follow-ons to the other vehicles are hotly anticipated (i.e., ITES-3S and RS3).  Vendors winning spots on these follow-ons expect there will be a decent amount of spending on cloud products and services so it is worth taking a look at spending data on the current vehicles.

Spending by Contract Vehicle

Taking a look at spending by vehicle first, we can see that obligations made over the four and a half year period from Fiscal Year 2010 to 2014 have been awarded primarily on the R2-3G contract.  Practically all of this work is related to Task Order #2T01, which was awarded to Booz Allen Hamilton for the Army’s “Rainmaker” project.  Rainmaker is a cloud-based intelligence system initially deployed to Afghanistan as part of the Army’s Distributed Common Ground System (DCGS-A).  Rainmaker is currently being engineered to tie into a number of Army intelligence data systems both abroad and here in the continental United States.

The other work represented here includes $12 million obligated for Tactical Cloud Integration Lab support at Aberdeen Proving Ground, $10 million for cloud related hardware and software awarded via ITES-2H, and $5 million awarded via ITES-2S for contractor support related to the Worldwide Ammunition Reporting System - New Technology (WARS-NT) application.  Presumably this effort involves cloud-enabling WARS-NT.  The available evidence is unclear at this point.

Spending by Fiscal Year

Turning to total spending by fiscal year on all four contracts, the data reveals a mild trend toward greater annual spending from FY 2012 onward.  The spike in obligations in FY 2012 is an aberration related to Rainmaker.  Spending the following year, however, continued to outpace that in FY 2011.  Similarly, spending in FY 2014 is already higher than FY 2011 even though data is available for only the first and part of the second quarters.

Spending by IT Segment

The data in the chart below should be taken with a grain of salt.  I tried to the best of my ability to separate obligations into cloud services, hardware, and software, but given the limited amount of information available from line item obligations data, there is bound to be some play in the numbers.  Despite the grayness I feel comfortable writing that the Services number is definitely the highest of the IT segments represented.  As for the hardware and software number, these are included because in the data there are obligations for applications (e.g., AppSense) to be delivered as Software-as-a-Service and hardware intended to optimize Army networks and data centers for the delivery of cloud-based services.  One such solution is Cisco Wide Area Application Services (WAAS) network equipment.  I realize that technically these purchases are not cloud “services.”  They are included here, however, because the Army considers the to be related to cloud and because in order to optimize networks for greater use of cloud services an investment in modern hardware is necessary.  Lastly, some equipment specifically intended to provide for the rollout of Unified Capabilities is included here for the reason just explained.  DoD will provide UC as a cloud-based enterprise service and so the equipment required to use it must be put in place.

Spending by Prime

Lastly, here is a quick look at spending by prime since FY 2010.  Not surprisingly, Booz Allen Hamilton leads the pack with almost $111 million in obligations related to Rainmaker.  The remaining vendors have earned relatively small amounts related to both services and commodity purchases by Army customers.

Observations

According to another dataset I maintain on total awarded cloud contract value, the Army has awarded contracts for cloud services valued at more than $525 million since FY 2010.  When comparing that data with the data above we can see that approximately 24% of Army contract spending related to cloud computing has gone through the four vehicles discussed here.  Also, the spending by fiscal year chart (#2 above) shows that spending by Army customers on cloud services using these vehicles is generally on an upward trend since fiscal 2012.  Both of these points lead to the conclusion that f vendors want to have a shot at Army cloud spending in the years to come the place to be will be on the follow-ons for these vehicles.

GovWin Recon - July 21, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

 

Headlines beginning with an * include quotes from Deltek analysts.   

 

Sequestration / Budget:

 

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Legislation:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

GovWin Recon - July 18, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Health IT:

Big Data / Analytics:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

GovWin Recon - July 17, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Health IT:

Mobility:

Transparency and Performance:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Legislation:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

GovWin Recon - July 16, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

 

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility/Communications:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Legislation/Policy:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

NIST Kicks Off New Cloud Computing Efforts

The National Institute of Standards and Technology (NIST) Cloud Computing Program (NCCP) launched three new working groups at the end of June 2014, and all three groups are set to start work by mid July 2014.

Following the announcement from NIST on June 25, 2014, the Cloud Computing Program will expand the number of public working groups to address several new areas. One working group will target interoperability and portability. Another group will focus on cloud services. The third group will concentrate on frameworks for federated community clouds.

Interoperability and Portability - Two of the major challenges highlighted in the U.S. Government Cloud Computing Roadmap from 2011 were cloud interoperability and portability. The focus of this group will include exploring contexts where interoperability and portability are relevant in cloud computing.

Deliverables from the working group will include definitions of cloud computing interoperability and portability along with the relationship and interactions between them. The working group will also develop contexts where interoperability and portability are relevant to cloud computing (and the cloud computing reference architecture). The group will then leverage those definitions and contexts to establish common terminology and concepts for interoperability and portability, particularly where cloud services are concerned. The kick off meeting for the working group is scheduled for July 10, 2014 with the target date for completing the work in fall 2015.

Cloud Services – According to the announcement from NIST, “The new public working group will use the NIST Cloud Computing Reference Architecture to provide consistent categories of cloud services so buyers know what they are committing to before signing costly, long-term contracts.”  This focus addresses the fourth requirement from the Cloud Computing Roadmap. The activities of this working group will enable customers to understand the complexities of different types of cloud services so they can better evaluate and select products from vendors. On the provider side, clear guidance will be established for where interoperability and portability are required within similar categories of services.

The first deliverable from this working group is expected to be a NIST guidance paper. Priority actions include categorizing common types of cloud services according to the NIST Reference Architecture to offer government organizations a clear and consistent view of cloud services. Efforts for this working group are scheduled to kick off July 15, 2015 with a goal of completing the deliverables this fall (on or around October 2014).

Cloud Federated Community Cloud Frameworks – The fifth requirement of the U.S. Government Cloud Computing Technology Roadmap covers the Federated Community Clouds. According to the group’s charter statement,” the focus of Federated Community clouds is to develop a framework to support seamless implementations of disparate community cloud environments. The future of cloud computing is where both internal and external cloud resources from multiple providers are deployed and managed in order to meet business needs.”

Deliverables from this working group include a common definition for “Federated Cloud,” as well as requirements analysis. The working group will be responsible for collecting use cases that support the need for a federated cloud and generating a list of needed technologies and standards. These efforts will also chart a development path for the federated cloud and identify key stakeholders.  The kick off meeting for this group is set for July 10, 2015 with the target date for completing this work in fall 2015.

These three new groups continue to build on the initial set of five public working groups, which included cloud computing reference architecture and taxonomy, security, standards roadmap, target business use cases, and standards acceleration to jumpstart the adoption of cloud computing (SAJACC). As the NCCP’s mission describes, “The long term goal is to provide thought leadership and guidance around the cloud computing paradigm to catalyze its use within industry and government. NIST aims to shorten the adoption cycle, which will enable near-term cost savings and increased ability to quickly create and deploy enterprise applications. NIST aims to foster cloud computing systems and practices that support interoperability, portability, and security requirements that are appropriate and achievable for important usage scenarios.” Additional information on participating in these efforts is available through the updated NCCP announcement site.

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Originally published in the GovWin FIA Analysts Perspectives Blog. Follow me on Twitter @FIAGovWin.

 

GovWin Recon - July 15, 2014

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts.

Sequestration/Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Health IT:

Big Data / Analytics:

Mobility/Communications:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Legislation/Policy:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

 

 

FITARA: The Pros and Cons of Cloud Services Working Capital Funds

The news has been replete recently with stories about the slow progress of the Federal Information Technology and Acquisition Reform Act (FITARA) through Congress.  If passed in its current form, FITARA, as it is known in the acronym-soup of the National Capitol Region, would be the single most important piece of legislation pertaining to federal IT enacted in many years.  FITARA has many important elements.  This post, however, focuses on just one – cloud computing working capital funds – and provides a few thoughts about the potential impact these funds could have on cloud adoption across the federal government.

“Section 303: Transition to the Cloud” of House Resolution 1232 (Section 5303 as written into the FY 2015 National Defense Authorization Act), authorizes agency Chief Information Officers to work with relevant fiscal authorities at their agency to establish cloud service working capital funds.  These funds would establish a ready pool of money to be used for investments in cloud computing.  Using working capital funds for cloud services would have several important effects on agency cloud procurement. 

First, funding available via working capital funds would provide increased flexibility for agencies seeking to leverage the “buy by the drink” benefit of cloud computing.  With a steady and reliable funding stream agencies would be able to realize the promise of utility-based computing.  This is not a benefit that many have been able to use so far.  A quick review of the contract language in many cloud procurements reveals that agency contracting shops are taking a standard firm fixed price approach to the acquisition of cloud services.  Agencies are thus squeezing square pegs into round holes and not getting the full benefits promised by a cloud approach.

Second, the use of cloud services working capital funds would centralize investment in cloud services.  Think of the impact this could have.  Authority centralized in the CIO’s office would enable the CIO to coordinate the use of cloud computing on an enterprise level.  Agencies are already moving toward common operating environments.  The cloud working capital fund provision of FITARA would basically enable the integration of cloud services into that common environment.  CIOs are also already deep into the process of inventorying applications and all other IT assets to comply with PortfolioStat.  Having gleaned an enterprise-wide picture of redundant capabilities an agency CIO with centralized investment authority could compete a single cloud contract for those capabilities in short order.  Duplication of buying would be removed from the environment.  So far so good, right?

The potentially not-so-good-for-industry part of this scenario is that these cloud working capital funds could eventually drive down IT spending.  Agencies continue to spend upward of 70% of their annual IT budgets maintaining legacy systems.  This funding flows into revolving generations of operations and maintenance contracts for those systems.  Conceivably, the centralized acquisition authority described above would also enable CIOs to direct greater percentages of funding toward work cloud-enabling older systems and applications.  While great in the short-run for vendors providing such services, once the transition to the cloud had been implemented, expenditures maintaining the operation of those systems would be set to a new and lower baseline.

In short, the passage and enactment of FITARA could be a mixed blessing for commercial cloud services providers.  Vendors offering cloud services would benefit in the near-term from the creation of cloud services working capital funds, but the eventual result of FITARA could be to drive significant reductions in IT spending at federal agencies.  By necessity this trend would result in a smaller market, a development that would be great for agencies and taxpayers, but not so great for those whose jobs depend on selling IT products and services to the federal government.  

 

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