Cloud

Cloud contracts: How to choose between winner-takes-all and best of breed

The Pentagon's upcoming multibillion dollar cloud deal will go to one provider, but is that the best option?

Building a slide deck, pitch, or presentation? Here are the big takeaways:
  • The Pentagon is set to award a multibillion dollar cloud contract to a single provider, locking them into one vendor.
  • As companies embrace the cloud, they must decide if they wish to go all-in with one vendor, or select best of breed components from multiple sources.

As the Pentagon prepares to make a massive move to the cloud, the US Department of Defense (DoD) has solidified its stance that the multibillion dollar contract will go to a single vendor, according to a report from the Wall Street Journal.

Amazon Web Services (AWS), the current leader in the cloud space, is expected to get the contract, especially due to its experience working with government contracts. Other top providers have lobbied for the contract to go to multiple vendors, the report said, but the DoD is moving ahead with its single-vendor plan.

The Joint Enterprise Defense Infrastructure (JEDI) contract could be the biggest cloud deal ever, the report noted, and it's all going to one company. Some of the main reasons for choosing this structure are accelerating cloud adoption and protecting data, according to defense officials cited in the report.

SEE: Cloud migration decision tool (Tech Pro Research)

What's happening with JEDI and the Pentagon highlights a common conundrum with the cloud: When is it best to go all-in with a single vendor, and when should an organization hand-pick best of breed technologies?

According to 451 Research general manager and research vice president Melanie Posey, it all depends on the maturity of the company in regard to their cloud needs.

For a company that has never used the cloud before and is jumping in feet first, going with a single vendor could make "quite a lot of sense," Posey said. This is especially true for firms that don't have much, or any, previous experience with the cloud, because there will be fewer tasks associated with integrating disparate solutions, Posey noted. It could also help with long-term strategy, as IT leaders only need to communicate their end goal to one party, which can then handle it from soup to nuts.

On the other hand, a "best of breed," wherein a company selects the best solutions from multiple providers and integrates them, may be good for organizations that have many stakeholders with different visions for what they want to do with their cloud resources, Posey said. For example, maybe a company wants the G Suite integrations of Microsoft Azure, but the machine learning tools in Google Cloud.

If any organization is philosophically committed to the best of breed approach, they must be "prepared to do some serious vetting" to determine which vendor is the best in a given service, Posey said. The company will also need the expertise to be able to properly integrate all of the services from various vendors once they've decided on them.

Regarding the fear surrounding best of breed, Posey said, "it's not so much about the technology itself, it's more about other concerns related to vendor lock-in." However, lock-in means different things to different professionals, and people aren't usually clear about what exactly they're afraid of when it comes to lock-in.

There's no real financial incentive for choosing a winner-takes-all approach versus best of breed, Posey said. Large enterprises, like the Pentagon, won't be paying "list price" for services anyway, because their size nearly guarantees a more custom pricing option.

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Image: iStockphoto/LeoWolfert

About Conner Forrest

Conner Forrest is a Senior Editor for TechRepublic. He covers enterprise technology and is interested in the convergence of tech and culture.

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