Cloud Spending on the Army’s Four Largest Task Order Vehicles
Published: July 16, 2014
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.
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.