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AWS $174 million DTA agreement a sign of how far cloud has come

by Jack Le Guay •
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AWS has signed a new three-year WofG agreement with the DTA for $174 million, bringing the total value of AWS volume sourcing agreements with the agency to $565 million. 

The new agreement signals a steep maturation in public sector cloud, only three years after AWS was certified to host PROTECTED level data by the Australian Signals Directorate (ASD) on the now-defunct Certified Cloud Services List (CCSL). 

The first three-year contract was signed shortly afterwards, in May 2019, with an initial value of $39 million. That figure was amended in October 2019 and July 2020, more than tripling the initial value of the contract. 

The average value of the six amendments over the two agreements is now $94 million, with a new amendment announced on average every seven months. The agreement is mandatory for non-corporate federal agencies and can also be used by states, territories and universities. 

2019 also saw the creation of the Microsoft VSA4 volume sourcing agreement, with both agreements largely responsible for tripling the value of the federal cloud market* in one year, from $217 million in 2018-19 to $604 million in 2019-20. 

Full-throated support for public sector cloud found in federal policy and strategy documents has been instrumental in pushing adoption. Recent publications such as the Digital Economy Strategy, Data Strategy, Digital Government Strategy and Secure Cloud Strategy have set both concrete and more aspirational long-term goals and guidelines that necessitate greater use of cloud. 

The creation of large cloud-based platforms such as the Welfare Payments Infrastructure Transformation has signalled cloud's growing importance and maturity. 

The federal government first addressed cloud in 2011 in the Australian Government Cloud Computing Strategic Direction document. This document outlined benefits and risks of the nascent technology and provided a potential roadmap for adoption. 

In 2013 the National Cloud Computing Strategy provided greater clarity around the government’s intentions regarding cloud use, requiring agencies to ‘consider’ cloud and efforts to standardise procurement processes. 

In 2014, the incoming Abbott Government went even further, announcing a ‘cloud-first’ policy at a time when there was still considerable confusion and scepticism of the technology. 

Many critiques of cloud centred around cyber security concerns, with the Australian Signals Directorate  refusing to certify cloud providers to host PROTECTED level data, slowing uptake in the federal market. 

This all changed with a relaxation of offshore hosting restrictions, leading to the certification of Microsoft Azure in 2018 and AWS in 2019. The CCSL process was dumped in 2020 and was superseded by a more agency-led approach outlined in the Secure Cloud Strategy.   

Alongside shifting attitudes on cyber security has been an explosion in cyber security investment in recent years, with the ASD contracting $1.37 billion in work since 2018-19. 

While all systems seem primed for continued cloud growth, people remain a significant bottleneck to further adoption. Skills shortages and general capability issues both within the public sector and in the broader economy continue to be weak points. However, this is also changing. 

On the government side, the creation of the APS Digital Profession, work by individual agencies and investment in digital skills programs have been recent developments to try and build skills and capability. 

Suppliers recognise the problem as well, with training and professional services also able to be procured by agencies through the AWS volume sourcing agreement. 

*Annualised figure. Based on a keyword search of cloud-specific terms Intermedium’s AnalyseIT database, the actual figure is likely much higher. 

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