After Failed REAN Cloud Deal, Pentagon Starts from Scratch


The Pentagon has reopened its search for a vendor to migrate its legacy applications to the cloud following the Government Accountability Office’s May 31 decision recommending that the Defense Department cancel its $65 million fast-track contract with REAN Cloud LLC.

The U.S. Transportation Command, or USTRANSCOM, will hold an industry day on Aug. 14 to “aid the Government in planning for our long term Cloud Computing solution,” according to a July 18 announcement.

A USTRANSCOM spokesperson confirmed that this procurement would replace the previous award to REAN Cloud, which the Pentagon scuttled following GAO’s May 31 decision. REAN didn’t respond to a request for comment.

Responses are due by Aug. 3 to register for the industry day, where vendors will have opportunities to meet one-on-one with government officials to discuss best practices in cloud migration and managed services, and recommend contract vehicles and pricing structures.

REAN Deal Revoked

In February, REAN Cloud was awarded a $950 million “other transaction authority,” or OTA, contract to migrate the Pentagon’s portfolio of legacy applications to the cloud. The deal was a follow-on to a successful pilot program with USTRANSCOM and the Defense Innovation Unit Experimental (DIUx).

The move sparked outcry from competitors, who criticized the fast-tracking of a contract of that size, rather than using full-and-open competition under federal acquisition guidelines. Others feared the award would tilt the Pentagon’s search for a commercial cloud provider in favor of REAN Cloud’s partner, Amazon Web Services LLC.

On March 6, the Pentagon scaled the the award back to $65 million and limited its scope to USTRANSCOM.

Less than three months later, the Pentagon revoked the deal entirely after GAO upheld a Feb. 20 bid protest from Oracle Corp.ruling that DIUx hadn’t exercised due consideration for competitive bidding. Further, GAO stated that REAN Cloud hadn’t yet completed its pilot program with USTRANSCOM, making it ineligible for an OTA award.

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