Have you heard of the cry baby who went to big mummy to try wrestle the lolly back?
We are referring to the recent case of Big Blue who lost a USD600 million bid to Amazon Web Services (AWS) to provide cloud computing to spy agency CIA.
Background in a nutshell, AWS was originally awarded the coveted US government contract after undergoing a tough bidding and evaluation process with IBM. Feeling sore and extremely unhappy, Big Blue brought this matter up to the Governmental Accountability Office (GAO), in an attempt to get support.
NOTE: GAO is an independent, nonpartisan agency that works for Congress. Often called the ‘congressional watchdog’ GAO investigates how the federal government spends tax payer dollars.
Surprisingly, the GAO recommended that the customer (CIA) rebid the contract!
Appalled, the winning IT provider AWS fired back with a lawsuit in the U.S. Court of Federal Claims to protect its well-earned contract to develop the CIA’s cloud platform.
Fortunately, the U.S. Court of Federal Claims upheld AWS’ win as deserving and additionally (upon detailed analysis of both parties’ cloud computing proposals), also accused IBM of “gamesmanship” – in terms of maneuvering around its proposed cloud solution by changing the criteria parameters and definitions to seem more capable than it actually was.
Adding salt to wound, the federal court judge said that “AWS’s offer was superior in virtually every way but price, and IBM’s advantage in that area was likely not as great as IBM attempted to make it appear.”
Owch and a double owch!
The wise judge added that by forcing the winner AWS to resubmit new proposals, “AWS would have to bid against its own winning proposal. This court will not allow such an unjust result.”
While this judgment puts rest to the fight over the huge CIA cloud computing contract, the entire episode also raises questions as to the customer’s veto right to decide who to buy from.
We would have all thought that the customer has the final discretion on its bed partner – who they want to buy from, work with and receive support from. However, this is not the case in the US where a 3rd party can ‘force’ the customer’s decision.
No doubt that the CIA is a US government entity, and the taxpayers monies have to be carefully accounted for – especially when it comes to such a huge spending of a couple of million dollars.
Nonetheless, the manner that the case was resolved – requiring the involvement of the GAO and a US federal court, suppresses the end customer’s right to be fully in control of what they want and decide on.
IT BYTES BACK! says: IBM issued a statement that said it, “… strongly disagrees with the court’s unwarranted assertions. Our position remains the GAO’s findings were appropriate and the contract should have been rebid.” Well, we say “Sore Loser.”
