In an unprecedented move by Amazon Web Services (AWS), the company signed a multimillion-dollar agreement with the Central Intelligence Agency. Drawing on the success of its cloud and domain hosting business, Amazon has released little information regarding this contract.
While the specific details of the agreement have not been made public, it is clear that Amazon is making a move to position itself in the private cloud business.
From various reports, it appears that Amazon is going to be providing cloud-based services for the Central Intelligence Agency by installing systems utilizing Amazon’s current technology and adapted for the private CIA cloud. Amazon will then be the CIA’s service provider for the next ten years, a lucrative deal that has many in the cloud web host industry up in arms.
Companies like HP, IBM and VMware are fired up that Amazon has taken steps to encroach on their business of providing enterprise services. In the past, AWS stuck to domain hosting and cloud services. With this current move, the company is beginning to make inroads into uncharted territory for Amazon.
Spokespeople for Amazon, while not releasing the specific details of what will be installed inside government data centers, did release a statement to the public that this was not the first time AWS has worked with government services. Services like GovCloud are specifically designed by Amazon to meet the needs of federal, state, and local government agencies. The hardware powering these services, however, is all stored inside Amazon’s own data centers, not the centers of the agencies.
What this does appear to be the first time for, however, is the specific construction of private cloud servers for a government entity inside of their own data centers. While the price tag has been heavily contested by rival IBM through a lawsuit filed through the Government Accountability Office (GAO), it is clear that Amazon will certainly benefit from this deal.
The lawsuit filed by IBM states that the Amazon contract was over $54 million more expensive than the offer made by IBM. As a result, the GAO countered with a response stating that Amazon offered an alternative solution that was technologically superior to that offered by IBM in this case.
Supposedly worth up to $600 million over the next ten years, this contract goes against the previous statements of Amazon stating that it was against all private cloud services. While competition in these markets is very fierce, it does seem that Amazon is drawing on its wildly successful background of public cloud and domain hosting to ensure success in these future endeavors.
Amazon has long been a leader in the public cloud services sector. It has seen wild growth and success as a result of smart investment and rapid technological advancements. Amazon’s data centers are now thought to contain a staggering amount of information, at least one percent of the entire internet.
As Amazon moves further into the private cloud sector, many eyes will be on the company and its response to its heavy competition. Whether or not this is the first private cloud created by Amazon, we’ll never know. What we do know is that, with so much money to be made, it likely won’t be the last.