GSA awards $93.2M for AWS cloud services and support, highlighting significant federal IT infrastructure investment

Contract Overview

Contract Amount: $93,204,852 ($93.2M)

Contractor: Amazon WEB Services, Inc.

Awarding Agency: General Services Administration

Start Date: 2021-06-14

End Date: 2026-06-13

Contract Duration: 1,825 days

Daily Burn Rate: $51.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: AWS CLOUD SERVICE AND VAR SUPPORT SERVICES

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20405

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $93.2 million to AMAZON WEB SERVICES, INC. for work described as: AWS CLOUD SERVICE AND VAR SUPPORT SERVICES Key points: 1. Contract value represents a substantial commitment to cloud computing infrastructure. 2. Competition dynamics suggest a mature market for cloud services, though specific details are limited. 3. Performance risk is moderate, given the established nature of the provider and service type. 4. This contract aligns with broader government trends towards cloud adoption for efficiency and scalability. 5. The sector positioning is within essential IT infrastructure, supporting a wide range of federal operations. 6. Pricing appears competitive within the context of large-scale cloud service agreements.

Value Assessment

Rating: good

The contract value of $93.2 million over five years for AWS cloud services and support is significant. Benchmarking against similar large-scale federal cloud contracts, this pricing appears to be within a reasonable range, reflecting the scale and scope of services provided by a major cloud vendor. The firm-fixed-price structure provides cost certainty for the government. However, a detailed cost-benefit analysis comparing this to alternative solutions or on-premise infrastructure would provide further insight into the value proposition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of multiple bidders in the federal cloud services market generally fosters competitive pricing and encourages innovation. While the specific number of bids received is not detailed here, the 'full and open' designation suggests a robust competitive process was initiated.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it increases the likelihood of securing services at the most competitive prices, preventing potential overspending and encouraging efficient resource allocation.

Public Impact

Federal agencies utilizing General Services Administration (GSA) managed cloud services benefit from scalable and reliable IT infrastructure. The contract supports a wide array of government functions by providing essential computing resources. Services are delivered primarily within the District of Columbia, impacting federal operations in the nation's capital. The contract supports jobs within the technology sector, particularly in cloud computing and IT support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with a single large cloud provider over the long term.
Reliance on a third-party for critical IT infrastructure introduces security and availability risks.
Ensuring continuous cost optimization within a large, ongoing cloud services contract can be challenging.

Positive Signals

Leverages a leading cloud service provider, offering advanced features and economies of scale.
The firm-fixed-price contract provides budget predictability for the government.
Awarded through full and open competition, suggesting a competitive pricing structure.

Sector Analysis

This contract falls within the broader Information Technology sector, specifically focusing on cloud computing infrastructure and related support services. The market for cloud services is highly competitive, dominated by a few major providers like Amazon Web Services, Microsoft Azure, and Google Cloud. Federal spending in this area has been steadily increasing as agencies migrate from legacy systems to more agile and scalable cloud environments. Comparable spending benchmarks would involve looking at other large federal cloud service contracts awarded to major providers.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is Amazon Web Services, Inc. a small business. The focus is on a large-scale enterprise cloud solution. There is no explicit information provided regarding subcontracting plans for small businesses within this specific award. The impact on the small business ecosystem is likely indirect, through the broader IT market dynamics influenced by large federal contracts.

Oversight & Accountability

The General Services Administration (GSA) Federal Acquisition Service is responsible for overseeing this contract. Oversight mechanisms would include regular performance reviews, contract management, and financial audits. Transparency is facilitated through public contract databases like FPDS. Inspector General jurisdiction would typically fall under the GSA's Office of Inspector General for any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Cloud Computing Services
IT Infrastructure Services
Data Processing and Hosting
General Services Administration IT Contracts
Federal Civilian IT Spending

Risk Flags

Potential for vendor lock-in
Reliance on third-party infrastructure
Ensuring continuous cost optimization
Data security and privacy management in cloud environments

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $93.2 million to AMAZON WEB SERVICES, INC.. AWS CLOUD SERVICE AND VAR SUPPORT SERVICES

Who is the contractor on this award?

The obligated recipient is AMAZON WEB SERVICES, INC..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $93.2 million.

What is the period of performance?

Start: 2021-06-14. End: 2026-06-13.

What is the historical spending pattern for AWS cloud services with the GSA?

Historical spending data for AWS cloud services with the GSA would reveal trends in the adoption and utilization of these services. Analyzing past contract awards and their values can indicate whether spending has been increasing, decreasing, or remaining stable. For instance, if previous contracts were smaller or less frequent, the current $93.2 million award suggests a significant scaling up of services or a consolidation of needs. Understanding this pattern helps in forecasting future IT infrastructure investments and assessing the long-term commitment to cloud solutions. It also provides context for the current contract's magnitude within the agency's overall IT budget and strategic direction.

How does the per-unit cost of AWS services in this contract compare to other federal agencies or commercial clients?

Comparing the per-unit cost of AWS services within this GSA contract to other federal agencies or commercial clients is crucial for assessing value for money. While specific unit costs are often proprietary or embedded within complex service bundles, benchmarks can be derived from publicly available data or industry reports. If this contract utilizes established GSA schedules (like AWS's presence on GSA MAS), pricing is often pre-negotiated and standardized to some extent. However, variations can occur based on volume discounts, specific service level agreements (SLAs), and contract duration. A favorable comparison would indicate competitive pricing, while a higher cost might warrant further investigation into the necessity of specific service components or potential negotiation opportunities.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this AWS contract?

Key Performance Indicators (KPIs) and Service Level Agreements (SLAs) are critical for measuring the performance and reliability of the AWS cloud services and support. These typically include metrics related to uptime/availability (e.g., 99.9% or higher), response times for support requests, data retrieval speeds, and security incident response times. The contract documents would detail these specific targets and the remedies or credits applied if they are not met. Robust KPIs and SLAs ensure that the government receives the quality of service expected for its investment and that the cloud provider is held accountable for delivering reliable and secure computing infrastructure.

What is the risk profile of Amazon Web Services, Inc. as a federal contractor based on past performance?

Assessing the risk profile of Amazon Web Services, Inc. (AWS) as a federal contractor involves examining its past performance, including any history of contract disputes, performance issues, or compliance problems. As a leading global cloud provider with extensive experience serving government clients, AWS generally has a strong track record. However, like any large contractor, there may be instances of performance deviations or challenges that were addressed. Federal procurement regulations require agencies to consider past performance when making award decisions. Information on past performance is often available through sources like the Contractor Performance Assessment Reporting System (CPARS), though detailed insights may be limited in public summaries.

How does this contract align with the government's broader cloud computing strategy and mandates?

This contract aligns with the U.S. government's broader cloud computing strategy, which emphasizes migrating federal workloads to secure, scalable, and cost-effective cloud environments. Initiatives like the Cloud Smart strategy encourage agencies to leverage cloud technologies to improve IT modernization, enhance cybersecurity, and drive innovation. By awarding a significant contract for AWS services, the GSA is facilitating this strategic shift, enabling agencies to access advanced cloud capabilities. This move supports goals such as reducing data center footprint, increasing operational agility, and improving the delivery of government services to the public.

What is the potential impact of this contract on federal data security and privacy?

The potential impact of this contract on federal data security and privacy is significant, as it involves the storage and processing of government data on AWS infrastructure. AWS operates under stringent security compliance frameworks, including FedRAMP (Federal Risk and Authorization Management Program), which authorizes cloud services for use by federal agencies. The contract would specify security requirements, data handling protocols, and responsibilities for maintaining confidentiality and integrity. While AWS provides robust security controls, the government agency utilizing the services remains responsible for configuring and managing security settings appropriately within the cloud environment to protect sensitive data.

Industry Classification

NAICS: Information › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services › Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47QDCB21Q0020

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 410 TERRY AVE N, SEATTLE, WA, 98109

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $145,164,994

Exercised Options: $144,803,356

Current Obligation: $93,204,852

Actual Outlays: $44,623,060

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47QTCA19D000C

IDV Type: FSS

Timeline