The fight between Amazon and IBM over the CIA’s $600 million cloud contract is taking an ugly turn especially for an industry that coined the term coopetition.
To quickly recap, Amazon Web Services won a contract with the CIA to provide cloud services. IBM protested and the Government Accountability Office agreed that some corrective actions needed to be taken.
The award was pulled back and new proposals were submitted for evaluation.
Pretty standard stuff so far, but then Amazon took the unusual step and filed suit against the federal government to force the CIA to abide by its original decision.
Now some of the contents of the lawsuit are public and Amazon’s lawsuit throws some sharp barbs at IBM and GAO, calling IBM’s protest “untimely” and “meritless.” GAO’s decision is “flawed.”
Very impolite language for the government market.
IBM’s response – to our sister publication FCW, which has been tight on this story – also goes after Amazon, a rising player in the federal space. “Unlike Amazon, IBM has a long history of delivering successful transformational projects like this for the U.S. government.”
I’m not sure if Amazon’s actions are burning bridges or not. But it is hard to imagine the two companies mending fences anytime soon. I doubt we'll ever see an Amazon-IBM team.
So much for the spirit of coopetition.
Oral arguments in the case are set for Oct. 7.
Posted on Aug 21, 2013 at 1:21 PM0 comments
Two more companies have joined four other losing bidders in protesting the Air Force’s NetCents 2 Application Services contract awards.
InfoReliance Corp. and Computer Sciences Corp. both filed protests on Friday. Decisions on their protests are due Nov. 25.
Their protests follow the protests of Booz Allen Hamilton, General Dynamics, HP Enterprise Services and Northrop Grumman.
More protests could be coming as the Air Force received 21 bids and only made six awards.
At the risk of repeating myself, the Air Force faces an interesting decision.
They will reaffirm the perception that they are dysfunctional if they quickly cave in and pull the awards for a self-imposed corrective action.
You’d think that after all the time they have taken with NetCents 2 – we are less than three months away from the third anniversary of the RFP – that their decision making would be bullet proof and they’d be able to withstand a bid protest fight.
But if recent history is any kind of indication, there are no clear skies ahead for the Air Force.
Posted on Aug 20, 2013 at 10:44 AM0 comments
The battle between SRA International and Science Applications International Corp. apparently is over as the Government Accountability Office has ruled against SAIC’s bid protest.
I told the story about these two Top 100 companies squaring off over a Military Sealift Command contract in a blog earlier this summer.
SRA was the incumbent on the contract but lost the recompete to SAIC in May 2012. They filed a protest and the command pulled back the award to take a corrective action because of issues with cost evaluations. They issued a new solicitation in August 2012.
This time SRA won the competition and SAIC filed its own protest. Earlier this month GAO rejected SAIC’s protest and the award to SRA stands.
According to the GAO ruling, SAIC objected to the agency’s cost realism evaluation of its proposal. They didn’t like the way the Navy adjusted labor rates and claimed that the Navy didn’t conduct meaningful discussions with respect to SAIC’s costs.
The company also objected to the Navy failing to downgrade SRA’s technical proposal in light of adjustments to SRA’s proposed costs.
“We have considered all of SAIC’s various arguments…and find that none provide a basis on which to sustain the protest,” GAO wrote in its decision.
So SRA hangs onto its work with a $56.5 million bid, which the Navy adjusted to $74.4 million to reflect current labor rates.
A couple things are interesting to me. One is that the protests resulted in two contract extensions for SRA as the Military Sealift Command needed coverage for the networks and communications between its 170 ships and the Defense Department’s ashore command and control infrastructure.
The second was the acknowledgement in the command’s justification for an extension of the delays the protests caused. The command said that in the future it needs to account for such delays when it creates the timeline for its procurements.
So while GAO’s decision allows the new contract to move forward, the reality remains that bid protests slow things down. That’s a shame but probably inevitable.
You can look at bid protests a few different ways:
- Protesters are sore losers.
- Companies game the system to hang on to work they rightly lost.
- Companies fight back because of agency procurement mistakes.
And guess what? I think all three of those are correct. You can find protests that fit any of those descriptions. But I’d also bet that the companies fighting back because they feel wronged are more common than the protestors who are sore losers or trying to game the system.
But that doesn’t mean that there aren’t problems with procurement, but the fix – more training and professional development and more people working contracts – will take years to have an impact.
Until then, bid protests remain a vital check and balance for a struggling procurement system.
Posted on Aug 20, 2013 at 8:06 AM0 comments