AWS rakes in half a billion pounds from UK Home Office
- Reference: 1701435667
- News link: https://www.theregister.co.uk/2023/12/01/uk_home_office_aws/
- Source link:
Amazon bankrolling industry lobbying against Microsoft Azure should surprise no one [1]READ MORE
The contract – valued at £450,281,369 to be precise but there is no guarantee it'll reach that – runs for three years and kicks off today. Payment will be spread over the contract period, and the contract was a call-off from a framework agreement. This means that it could have been awarded after a mini-competition or been given directly to AWS.
The Register contacted the UK government early this morning to check how the award was made, but we have yet to receive a response.
The size of the award indicates the service will underpin the Home Office's digital operations, and it comes at an interesting time for AWS. The cloud giant and arch-rival Microsoft are under increasing scrutiny in the UK as the competition regulator examines just how level the playing field is.
Both businesses have won huge contracts in the British public sector in recent years. As an example, AWS [2]was tapped to provide storage for secret government files, and a four-year hyperscale cloud deal [3]was inked with the UK tax office – HMRC – in 2021.
[4]European Commission loves Oracle enough to sign six-year cloud deal
[5]Unit4 ditching on-prem in favor of SaaS come 2025
[6]AWS says it wants in on the European sovereign cloud game
[7]Amazon, Microsoft under UK regulator's eye as cloud market probe confirmed
The Home Office itself is no stranger to AWS, having signed a multimillion-pound services deal with the cloud vendor a few years ago. By our reckoning, that contract is coming to an end, and so here we are at the renewal stage.
How much longer the cloud party will go on for is open to conjecture. In October, the UK's Competition and Markets Authority (CMA) [8]confirmed it is going to inspect the health of the UK's cloud marketplace, currently dominated by AWS and Microsoft, which are estimated to account for up to 80 percent of the approximately £7.5 billion ($9.5 billion) local cloud infrastructure market.
[9]
As far as the contract starting today is concerned, it is not clear exactly what public cloud hosting services AWS will be providing, although the very specific amounts mentioned indicates that the department has a good idea of what it wants from the contract. Certainly, the amounts involved would indicate that a substantial amount of digital work in the department will be running on Amazon's infrastructure. ®
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[1] https://www.theregister.com/2023/11/17/anti_microsoft_amazon/
[2] https://www.theregister.com/2021/10/26/uk_security_services_aws/
[3] https://www.theregister.com/2021/02/19/aws_hmrc_contracts/
[4] https://www.theregister.com/2023/11/02/european_commission_oci/
[5] https://www.theregister.com/2023/10/31/unit4_onprem_support_2025/
[6] https://www.theregister.com/2023/10/25/aws_sovereign_cloud_product/
[7] https://www.theregister.com/2023/10/05/uk_iaas_probe_confirmed/
[8] https://www.theregister.com/2023/10/03/uk_iaas_market_cma_probe/
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/paasiaas&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZWoRM7qyarm8@WmTbeVphAAAANA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[10] https://whitepapers.theregister.com/
Guess it depends on how much profit Amazon makes in the UK
AWS parasites
Nah, they'll do what they always do, offshore the profit into a low tax country and pay zero corporation tax. They contribute little to the UK and just take, take, take
Magic Money Tree
It does exist, then.
How much has the home office wasted on previous "deals"?
How many hospitals would this build?
Hmmm, are we sure using AWS is a great plan for secret goverment files based on how seemingly difficult it been for everyone else to stop their S3 buckets from leaking. I suppose on the flip side they'll be open secrets before long.
Interesting detail in the contract
I wouldn't worry so much about the S3 buckets - the Home Office is so comfortable it has waived all AWS's security clearances for this contract https://www.contractsfinder.service.gov.uk/notice/48741bae-f983-483f-b55c-7cbc1a928b97?origin=SearchResults&p=1 (see technical requirements within the published contract)
Re: Interesting detail in the contract
Also on that contract finder page it shows Amazon Web Services as an SME.
So that's how more contracts are awarded to smaller organisations - just label anyone as such!
We need a scale of cloud sizes
The earlier contract was for two years and a "hyperscale cloud service". Which I assume is access to everything it may ever need in a hyperscaling sort of way ...
This one is "£450,281,369 to be precise [and] runs for three years" - so I assume it's whatever is bigger than "hyperscale" ... more than everything ... Marketing Hyperbole scale? Government twaddle-speak scale? Backhander scale?
Be interesting to see what the Government actually gets from this that makes it worth almost 10x the price of a "hyperscale" system.
Re: We need a scale of cloud sizes
The deal delivers two things - firstly a shed load of money to the private sector, which is a "win" because the Tories hate everything about the public sector, secondly it's a hugely expensive millstone they can put round the neck of the Home Office, and will be a burden on the next government, which clearly isn't going to be a Conservative one. If the terms of the contract have been tweaked enough for ministers to be pleased, then a huge over-run will occur, which the few remaining Tory morons will be cat-calling and mocking the next government for.
Like many things the government are currently committing to, they're being done out of spite because they known their numbers up. It's a bit like when John Major privatised the railways - it was deliberately done in a fashion that would make undoing it so slow and complicated that nobody would attempt it. On that last one of course, it's rather amusing that it has been the Tories who have brought most of the railways under direct state control.
AWS was tapped to provide storage for secret government files.
Is it April 01 already ?
HOLY FUCK.
Nuff said
Yes minister that's correct. Their CTO is based in Monaco and their Head of legal in Geneva. You'll need to visit them regularly if we sign this deal, so it's a bloody handy coincidence that you love F1 and skiing.
"The contract – valued at £450,281,369 to be precise"
No, that's just the initial cost.
The true cost is going to be more because cloud activity will ramp up and incur cost overruns, to no one's surprise.
Uneless there's a clause in there that caps AWS on the amount it can invoice without capping the UK Home Office's activity ?
I don't think so.
Taking All Bets
1:10 odds for the actual cost will be the contract value
2:5 odds that the cost will overrun
1:2 odds that the cost will be at least double the initial contract value
For
that money, they could build their own government cloud service, and not have to worry about where the data will end up.
Unless thats the plan all along.......
My comment is that this shows what the Home Office are directly contracting, there will be a number of their suppliers who are also making use of AWS.
The size of the award indicates the service will underpin the Home Office's digital operations, and it comes at an interesting time for AWS. The cloud giant and arch-rival Microsoft are under increasing scrutiny in the UK as the competition regulator examines just how level the playing field is.
Both businesses have won huge contracts in the British public sector in recent years. As an example, AWS was tapped to provide storage for secret government files, and a four-year hyperscale cloud deal was inked with the UK tax office – HMRC – in 2021.
It'd be very interesting to see how much tax AWS pay HMRC on the ~half billion