The Pentagon’s cancellation of the $10 billion JEDI cloud computing contract won in 2019 by Microsoft – the biggest tech story of the week and surely one of the biggest of the year – has major implications for the HPC and Big AI sectors. Though just what they are or will be is, for now, a matter of speculation.
But one thing is certain: JEDI’s successor contract will boost an HPC market trend in place for at least two years: cloud HPC adoption is growing rapidly. We say this thanks to industry analyst Steve Conway, Senior Adviser, HPC Market Dynamics at Hyperion Research, who enlightened us about a Pentagon policy document, released on May 26 by DoD’s acting CIO John Sherman, called “Department of Defense Outside the Continental United States (OCONUS) Cloud Strategy.”
Assuming the document has both domestic and global implications for DoD, it’s clear the Pentagon regards HPC and AI as integral to its cloud plans.
“OCONUS users must have access to deployable cloud computing, high performance computing, and edge computing capabilities as they become available,” the document declared. “This includes innovative cloud services that enable agile software development, robust collaboration, and powerful analytics such as Al/ML.”
“So there’s the cloud and high performance computing tied together…,” Conway said. “The OCONUS strategy is exclusively a cloud strategy… for DOD. …the strong tie in between cloud and HPC is baked right into the document.”
Another outcome indicated by other Pentagon JEDI-related statements is that Amazon and Microsoft appear to have inside tracks to winning post-JEDI DoD cloud business. In its July 6 announcement, DoD said that JEDI’s single supplier approach would be replaced by multiple providers, most likely AWS and Azure – though the department said it remains open to other cloud services providers (CSPs) successfully competing for Pentagon business.
Referring to its new-found “multi-cloud/multi-vendor” strategy, the Pentagon said: “The Department intends to seek proposals from a limited number of sources, namely the Microsoft Corporation (Microsoft) and Amazon Web Services (AWS), as available market research indicates that these two vendors are the only Cloud Service Providers (CSPs) capable of meeting the Department’s requirements. However, as noted in its Pre-Solicitation Notice, the Department will immediately engage with industry and continue its market research to determine whether any other U.S.-based hyperscale CSPs can also meet the DoD’s requirements. If so, those Department will also negotiate with those companies.”
The JEDI mono-vendor potboiler, enlivened by the prospect of enormous money going to only one CSP, has endured for several years, with vendors such as Oracle and IBM accusing the Pentagon of giving AWS unfair advantages in how the JEDI contract was drawn up. Later, former President Trump, in a potboiler of his own involving former Amazon CEO (and Washington Post owner) Jeff Bezos, became involved, calling for an investigation into the JEDI process. The two years that have followed Microsoft being named (and renamed) the JEDI winner have been rife with protests and court cases filed by Oracle and AWS.
It’s taken so long – with the prospect of more process to come – that in its announcement this week the Pentagon said the JEDI strategy has become obsolete. “The Department has determined that, due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI Cloud contract no longer meets its needs. The Department continues to have unmet cloud capability gaps for enterprise-wide, commercial cloud services at all three classification levels that work at the tactical edge, at scale — these needs have only advanced in recent years,” the Pentagon said, citing such efforts as Joint All Domain Command and Control (JADC2) and the Artificial Intelligence and Data Acceleration (ADA) initiative.
According to federal sector observers, single vendor contracts tend to generate legal challenges and delays.
“Pentagon contracting rules, especially for contracts awarded to a single provider, have a formal appeal and challenge process,” stated Kelsey D. Atherton in an article in Popular Science yesterday. “Sometimes, the process helps make sure that a company promising an aircraft, for example, can actually deliver it. With JEDI, challenging the contract also meant freezing the entire process in time, as the military’s data storage and transfer needs evolved while the contract was unable to be filled. The long legal fight over JEDI kept the Pentagon from adopting one big cloud…”