{"id":24936,"date":"2018-11-15T02:15:03","date_gmt":"2018-11-15T02:15:03","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2018\/11\/15\/gao-shuts-down-oracles-jedi-protest-but-its-not-over-yet\/"},"modified":"2026-08-08T04:45:17","modified_gmt":"2026-08-08T04:45:17","slug":"gao-shuts-down-oracles-jedi-protest-but-its-not-over-yet","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/industry\/2018\/11\/15\/gao-shuts-down-oracles-jedi-protest-but-its-not-over-yet\/","title":{"rendered":"GAO shuts down Oracle\u2019s JEDI protest, but it\u2019s not over yet"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The Government Accountability Office has denied a bid protest from Oracle America Inc., which argued that a massive, controversial Pentagon cloud contract was improper and &#8220;unduly [restricts] competition\u201d in its <a href=\"https:\/\/www.c4isrnet.com\/it-networks\/cloud\/2018\/04\/23\/the-case-for-dods-single-award-cloud-contract\/\" target=_blank>winner take-all-structure<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In a Nov. 14 <a href=\"https:\/\/www.gao.gov\/about\/press-center\/press-releases\/read\/oracle_bid_protest_nov_2018.htm\" target=_blank>statement<\/a>, Ralph White, the GAO\u2019s managing associate general counsel for procurement law, denied all three of Oracle\u2019s areas of protest, asserting that the Department of Defense\u2019s ongoing Joint Enterprise Defense Infrastructure cloud contract acquisition process is consistent with procurement regulations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The JEDI cloud contract <a href=\"https:\/\/www.federaltimes.com\/it-networks\/2018\/07\/26\/jedi-10b-final-request-drops-and-its-still-single-award\/\" target=_blank>was announced in July<\/a> as a single-award, indefinite-delivery\/indefinite-quantity contract that could be worth up to $10 billion dollars over the next decade. Many say the contract represents the first major step toward a cloud-based future for DoD, though Pentagon officials have downplayed this idea.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cFolks are trying to present this as the Department of Defense moving to a single award for all cloud computing,\u201d Robert Daigle, director of cost analysis and program evaluation at the Pentagon, told reporters earlier this year. \u201cThis contract, even if we max out the annual spend, represents about 16 percent of our hosting costs currently, which represent about 12 or 13 percent of our overall business system IT costs. So really the amount that we\u2019re talking about here is not the end of history; it\u2019s one cloud contract.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But the significance is undeniable, and the single-award approach has drawn further criticism from throughout the defense industry that the winner will have a de facto stranglehold on the Pentagon\u2019s cloud-computing structure in perpetuity. Congress, too, has raised questions and even <a href=\"https:\/\/www.federaltimes.com\/it-networks\/2018\/09\/14\/dods-still-got-some-jedi-splainin-to-do\/\" target=_blank>outlined restrictions<\/a> on JEDI funding in the defense spending bill in September.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe single-award approach is contrary to industry\u2019s multi-cloud strategy, which promotes constant competition, fosters innovation and lowers prices,\u201d Oracle wrote in its bid protest.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Daigle and other DoD officials have <a href=\"https:\/\/www.federaltimes.com\/it-networks\/2018\/04\/24\/jedi-cloud-contract-fair-and-open-competition-shanahan-says\/\" target=_blank>rebuked that idea<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe\u2019ve not heard anybody say that a multiple-cloud solution is a better solution for providing that capability to the war fighter, and that\u2019s why we\u2019re saying that based on where technology is today, based on where the offerings of the commercial cloud providers are and based on current acquisition law, the department\u2019s optimal solution is a single award contract,&#8221; Daigle said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But according to the GAO, the Pentagon\u2019s decision to go with a single company for the massive cloud-computing contract was proper and legal.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe agency reasonably determined that a single-award approach is in the government\u2019s best interests for various reasons, including national security concerns, as the statute allows,\u201d White wrote.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Oracle and others also accused the Pentagon for playing favorites by formulating the contract in a way that guarantees only Amazon or Google can truly compete for the work. Amazon was immediately seen as the front runner, because it already won a $600 million cloud contract from the Central Intelligence Agency in 2013.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Pentagon officials have denied the allegations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe approach here has been really around a fair and open competition,\u201d Deputy Secretary of Defense Patrick Shanahan said earlier this year. \u201cWe want to create long-term, strong industrial partnerships, but we want multiple partnerships.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the GAO statement, Scott also disagreed with such accusations \u2014 at least from Oracle \u2014 writing, \u201cthe allegations regarding conflicts of interest do not provide a basis for sustaining Oracle\u2019s protest.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Oracle is not alone in their protest of the Pentagon\u2019s cloud-computing procurement process. IBM filed its own protest in October also challenging various aspects of the JEDI procurement. The GAO is reviewing that protest with an expected decision of Jan. 18.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cPre-award protests, such as the ones filed by Oracle and subsequently IBM, are exceptionally challenging considering agencies are granted broad discretion in describing solicitation requirements,\u201d according to Lauren Brier, an associate attorney who focuses on federal contracting at the Washington-based Federal Practice Group. \u201cAs long as an agency provides a reasonable explanation for such challenged requirements, the pre-award protest will likely make it past GAO review.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In May, Oracle successfully protested a nearly $1 billion Army cloud contract that was awarded to REAN Cloud LLC, eventually leading to the program being cancelled. One key difference in the two protests could be the timing.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWith a projected award date of spring of 2019, most of the attention will now turn to the upcoming awardee and any post-award protests that may follow,\u201d Brier said.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>One JEDI protest down &#8230; many, many more likely to 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