Interior wins protest of huge cloud contract

Monday - 8/5/2013, 6:09pm EDT

The Interior Department's foundation cloud hosting services contract finally is free from protests and ready to be used by the bureaus.

The Court of Federal Claims denied CenturyLink's protest on July 26, saying the telecommunications company did not "succeed on the merits of its protest" so the court did not "consider the standard for injunctive relief has been met in this case."

This was CenturyLink's third unsuccessful protest of the cloud contract that could be worth $10 billion over nine years.

The department asked vendors to provide a variety of cloud services, including storage, secure file transfer, virtual machine, database, Web hosting and a development and test environment.

Interior awarded places on the indefinite delivery, indefinite quantity multiple award contract in May to:

  • Aquilent
  • AT&T
  • Automonic Resources
  • IBM
  • CGI
  • GTRI
  • Lockheed Martin
  • Smartronix
  • Unisys
  • Verizon

Of those 10 companies, four received the initial authority to operate under the Federal Risk and Authorization Management Program (FedRAMP).

Interior awarded the first task order under the contract in June despite the protest. Unisys won the deal to move Interior's Financial and Business Management System (FBMS) to the cloud. The eight-year, $44 million contract will help the department lower its costs and improve the operation and maintenance of the enterprise resource planning (ERP) system.

CenturyLink filed a preward protest with the Court of Federal Claims March 14 asking for a temporary restraining order, a preliminary injunction and a permanent declaratory and injunctive relief.

The company based its protest on several factors including the solicitation does not provide adequate information regarding the agency's actual storage requirements for any of the technical service lines and therefore the rest of the procurement is flawed. CenturyLink also argued that the technical evaluation and the price evaluation criteria were unreasonable.

CenturyLink made its case to the court by saying "RFP does not tell offerors what they need to know in order to compete intelligently on an equal basis with respect to data storage for the technical service line for virtual machines." The company asserts the RFP does not state what the agency's actual storage requirements are and directs offerors to allocate proposed storage volumes in an irrational manner, and the agency does not identify how many virtual machines the agency requires, and the range provided in the solicitation is "so broad as to be meaningless."

CenturyLink argued that Interior did not establish a uniform basis upon which to evaluate offerors' technical proposals. It also stated that DoI's "unit of service" measure upon which offerors are required to base their pricing for cloud- based services was flawed. Therefore, Interior could not have an equal basis upon which to evaluate offeror pricing.

"We're disappointed with the Court of Federal Claims' recent decision as we do not enter into protests or claims unless we have a reasonable expectation of a positive outcome," said a CenturyLink spokeswoman in an email.

Interior argued that virtual server system files are routinely generated, their aggregate size is predictable, and as a result, there are established standards for how much digital space is appropriate for a particular server.

"Modernizing the way the Department of the Interior does business by moving our applications and data to cloud technology allows Interior to speed up the acquisition process and make our data and applications more accessible to the public and to our geographically diverse workforce," said Andrew Jackson, Interior's Deputy Assistant Secretary for Technology, Information and Business Services in an email. "We expect to provide greater variety of services, security, and support for application owners and employees."

The court found "DoI provided all the necessary parameters for the virtual servers. For instance, the government described the type of operating systems that the servers would need to run — Windows, Unix, and Linux — and identified the percentage of each system that would be required; the performance characteristics of the computers that the servers would be serving; and the speed of data access that the servers would be required to support."

The court also agreed with the government and CGI, which acted as an intervenor in the case, that Interior failed procedurally to raise all of its challenges in its opening brief and therefore results in the waiver of those arguments raised in the reply.

The court found both of CenturyLink's claims that the price and technical evaluation criteria lacked merit.

CenturyLink first protested the request for proposals in November 2012 to the agency based on questions and answered received about the RFP. Interior dismissed the protest in December.

CenturyLink then protested to the Government Accountability Office in December, 10 days after Interior denied their protest. The company brought similar challenges to the RFP that it alleged to the Court of Federal Claims.

GAO denied the protest in March 2013 — the same month CenturyLink filed with the Court of Federal Claims.

This was the second major cloud computing contract that came under a series of protests. Interior's award to Onix and Google went through several iterations of protests before a final award in May 2012.

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