Federal Cloud Computing: A Competitive Landscape Snapshot

Published: September 23, 2015

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Cloud vendors in the federal marketplace come in all sizes. Established large businesses are winning the lion’s share of the work, but small and mid-sized businesses are finding success delivering software and platform-based solutions.

As government personnel from the top down continue to emphasize the importance of leveraging the cloud for their IT needs, every vendor and their uncle has responded by creating a cloud-based service offering. This evolving situation has provided agency customers with an unprecedented variety of cloud choices. It has also heightened competition in the federal cloud market, making it a challenge to understand who’s having success. Fortunately, Federal Industry Analysis’ cloud contracts database offers insight into the competitive landscape of cloud vendors and the services they are providing. Today’s post leverages that data to shed light on the highest earning companies and to illuminate some of the complexities in the market that go beyond simply the delivery of Infrastructure, Platform, or Software-as-a-Service.
Cloud Vendors by Won Contract Value
Starting with the view from 30,000 feet, the chart below shows the ten leading vendors in the federal cloud market based on the value of the contracts they’ve won over the last five fiscal years.
The field is almost entirely dominated by established federal contractors. A few of the vendors involved, like IBM, Dell, and Verizon, do have large commercial operations as well, but their presence in the federal marketplace is longstanding. The only newcomer is Amazon Web Services, which has become a major player in both the public and private cloud markets in just the last five years. The major takeaway from this data is that established federal contractors are not being shoved out of the market by commercial companies. Rather, agencies continue to trust them the most to provide technological innovation, including cloud-based solutions.
Cloud Vendors by X-as-a-Service
Parsing the data by service delivery type changes the picture, revealing that certain vendors dominate in certain service delivery types.
Predictably, the field of infrastructure providers is led by Amazon Web Services. The total number of contract dollars AWS is earning, however, is probably much higher than the awarded contract value data is able to depict here. This is because AWS works with a number of partner firms, like DLT Solutions, which win contracts to migrate data to AWS data centers. Contracts are thus awarded to the partner firms, but AWS gets a major share of the work.
When it comes to SaaS vendors the picture shifts again to include smaller businesses like InfoReliance, Visionary Integration Professionals, and the District Communications Group.
Dell Federal appears on this list because it is providing a number of agency customers with the Microsoft Office 365 suite of business applications under several high-value contracts.
Finally, here is a look at the vendors providing identifiable Platform-as-a-Service solutions. This group of vendors includes smaller players too, as well as some larger, well-known names.
Almost invariably, the PaaS solutions are being used by government customers for testing and production environments. Many vendors providing IaaS services also provide PaaS capabilities, however, so the lower contract totals shown here should not be considered definitive. Unfortunately, disentangling IaaS from PaaS is impossible for someone looking in from the outside.
Reviewing the provided data yields several insights into the state of the federal cloud market.
First, established vendors are holding their own against commercial newcomers. Companies like Microsoft and Google aren’t well represented in the data, but they are players in the market (especially Microsoft). It is simply difficult to determine the success they are having.
Second, large companies dominate the Infrastructure-as-a-Service side of the market. This is no surprise given the level of investment required to stand up data centers.
Third, smaller companies are having success providing Software and Platform-as-a-Service capabilities. Even here, however, they are facing stiff competitive from large businesses.