FY 2020-2022 Air Force Cloud Spending

To say that the Department of Defense (DOD) has slow-rolled its transition to the cloud would be an understatement. Progress adopting cloud has proceeded in fits and starts with most parts of the department adopting cloud capabilities very slowly. Concerns about security dominated the early days of adoption, but when these had been largely overcome the challenge then became how to deal with the complexity (and propriety) of transitioning legacy systems to cloud platforms. Application rationalization followed, giving components visibility into the capabilities they already owned so that they could make informed migration decisions. While all of this was happening, department leadership became embroiled in controversy about the approach it should take to enterprise cloud adoption. The effort to procure a Joint Enterprise Defense Infrastructure (JEDI) then floundered, leaving department components to chart their own course.

Amidst all of this, the Air Force proved to be the most aggressive of the military departments to adopt cloud capabilities. Contracts for the Cloud One and Platform One efforts were awarded a few years ago. Now these building blocks are bearing fruit as evidenced in the spending data.

• FY 2020 - $777M
• FY 2021 - $861M
• FY 2022 - $1,687M

Totaling $777M in FY 2020, the Air Force’s identifiable spending on cloud exploded in FY 2022, more than doubling to $1.7B. This is the most significant jump in cloud spending by a military department that this analyst has ever seen. It demonstrates the strength of the Air Force’s pivot to the cloud over the last few years.

To what can we attribute this rise? The data shows two big drivers – growth in the use of the Platform One software development cloud and the adoption of cloud-based capabilities.

SaaS

• FY 2020 - $337M
• FY 2021 - $312M
• FY 2022 - $811M

PaaS

• FY 2020 - $102M
• FY 2021 - $110M
• FY 2022 - $290M

IaaS

• FY 2020 - $78M
• FY 2021 - $129M
• FY 2022 - $204M

Air Force investment in Platform-as-a-Service (PaaS) nearly tripled from FY 2020 to FY 2022, making it the fastest area of growth, and demonstrating the promise that PaaS has always had for leading the market. Not to be left behind, spending on Infrastructure-as-a-Services (IaaS) also came close to tripling and spending on Software-as-a-Service (SaaS) more than doubled.

Parsing the spending data by market category confirms the rise of PaaS and growing dominance of SaaS in the Air Force’s portfolio.

• Cloud Capability - $1,746M
• Cloud Engineering - $1,487M
• Unknown - $49M
• Consulting - $26M
• Cloud Infrastructure - $15M

Spending on cloud capabilities, those delivered as SaaS, totaled more than $1.7B over the three year period. Meanwhile, spending on Cloud Engineering, which includes PaaS work, came in a close second, totaling $1.5B. Air Force customers also spent small amounts on cloud infrastructure and cloud-related consulting.

The commitment to the cloud that Air Force leadership made several years ago appears to be paying dividends. This bodes well for industry partners who have waited patiently for at least a part of the DOD to finally accelerate its transition to cloud-based platforms and capabilities.