Top Ten Cloud Vendor Solutions from FY 2013 to 2015
Published: September 14, 2016
Cloud computing is a brave new world for federal contractors, but who’s winning in it?
Vendors like to know the lay of the land when it comes to competing for government contract dollars. Sometimes, however, getting detailed information on certain subjects can be challenging. Take the federal cloud computing market, for example. Vendors offer a vast array of cloud services that are often layered on top of solutions provided by strategic partners.
These partners, companies like Amazon Web Services, Microsoft, IBM, and others offer vast computing and storage infrastructure resources that small and mid-sized businesses cannot. Conversely, small businesses can compete for set-aside contract dollars (the percentage of which is growing, by the way) that the large companies cannot. The result is a strategic teaming arrangement in which the small business prime competes for, say, a cloud migration contract. But when they win the work, the migrated data is hosted by the large business sub-contractor. This common arrangement leads to the question of competitive advantage. Are the “top vendors” in the cloud space those companies that are winning contracts as primes or are they the large business subs doing the hosting of federal agency data? And of the two which is the actual cloud service provider?
A couple of visual examples will clarify the concept and illustrate the difficulty of knowing exactly who is winning the most in the federal cloud market. The first chart below shows the top ten cloud vendors from fiscal 2013 to 2015 based on the value of prime contracts won. This data comes from Deltek GovWin’s cloud computing database, which is a collection of more than 1,600 efforts and contracts available with purchase of our Federal Priorities: Cloud, Big Data, Mobility, and Data Centers report due out at the end of October.
According to this data, Amazon Web Services leads the pack with just over $600M in awarded contract value. Most of this total is attributable to the big award given by the CIA for on-premise Commercial Cloud Services (C2S). Meanwhile, other big players like Microsoft are nowhere to be seen among the top ten vendors.
Now compare the chart above with this one below.
The data in this chart shows awarded contract value by the commercial solution provided to government customers (to the extent that we have been able to identify it). This chart provides a peek behind the sub-contracting/strategic teaming curtain discussed above. Notice how the total for AWS is now $288M higher than it was in the first chart. Also notice how Microsoft’s cloud-based Office 365 solution is represented. Azure is a different animal altogether that is harder to identify. As a final caveat, I’d also recommend viewing these totals as the minimum for each type of vendor solution. The real totals are probably much higher.
This exercise illustrates the challenges inherent to determining who the leaders are in federal cloud computing. The available data confirms the general belief that Amazon Web Services has taken the cloud market by storm since arriving on the scene just a few years ago. Microsoft also continues to hold its own thanks to the proliferation of its Office products, which it now offers exclusively via the cloud. These are the commercial giants with which traditional government contractors must now contend in the brave new world of cloud computing.