Army Spending on Other Transaction Agreements for Cloud Computing, FY 2020-2022

Last week’s post examined the spending data for cloud-related prototype projects carried out by the Department of Defense’s Fourth Estate. This week’s post takes a look at similar data for cloud-related work undertaken by organizations in the U.S. Army. The Army is one of the DOD’s components that took advantage early on of the new procurement method called Other Transaction Authority (OTA). The latest data on OTA spending shows that this trend is ongoing with a growing number of components leveraging OTA for cloud-based prototypes.

Total Cloud-Related OTA Spending, FY 2020-2022

A look at the obligations data for cloud-related OTAs reveals that the Army spent $420M in FY 2022. Three-year spending on cloud-related prototypes, meanwhile, totaled $1.2B. Contrary to what we saw with the Fourth Estate’s steadily rising spending, however, the Army’s cloud OTA spending more resembles a roller coaster. Reaching a peak in FY 2020, spending turned downward in FY 2021 due to the end of several prototype projects. Spending in FY 2022 then began to recover as several organizations started new work.

Cloud-Related OTA Spending by Army Organization, FY 2020-2022

The Army organizations using OTA contracts to do cloud-related work are listed in the chart above. For those that reported their spending, the presence of Army program executive offices is no coincidence. The Program Executive Office Enterprise Information Systems (PEO EIS), for example, was among the first in the Army to being leveraging OTA for cloud-related projects. Its spending rose every year, from $196M in FY 2020 to $244M in FY 2022. The cloud-related projects that make up PEO EIS’ spending are as follows

• Army Vantage - $340M
• Cyber Protection Brigades - $216M
• Army Accessions Information Environment - $69M
• Army Training Information System - $49M (Ended in FY 2021)

The PEO Simulation, Training, and Instrumentation (STRI) also increased its spending on cloud prototypes, from $49M in FY 2020 to $133M in FY 2022. Cloud OTA projects undertaken by PEO STRI include the following:

• Synthetic Training Environment Training Management Tool - $98M
• Persistent Cyber Training Environment Cyber Innovation Challenge #4 - $44M
• Persistent Cyber Training Environment Cyber Innovation Challenge #1 Follow-On - $96M

At least five other Army offices also began leveraging cloud-related OTAs in FY 2022, including PEO Command, Control, and Communications-Tactical, Army Training and Doctrine Command, Army Materiel Command, and Joint Munitions Command. All of these organizations are contributing to cloud work related to Army’s Cyber Protection Brigade with FY 2022 spending totaling $19.2M.

Parting Thought

Army’s spending on OTAs illustrates the volatility that can accompany R&D work for the DOD. OTA programs are not generally intended to carry on for several years. Rather, they often last for less than one fiscal year until they result in either a useable proof of concept or a prototype. It’s really only at a couple of the Army’s PEOs that long-term OTA-related work is going on. The other news worth reporting is that a larger number of Army organizations are beginning to leverage OTA.