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Amazon's AWS set to sign $600m CIA cloud contract

There's money to be made in the cloud

Amazon is set to win a $600 million contract with the Central Intelligence Agency (CIA) to provide a unified platform for its 17 internal divisions.

According to GovExec, not only will that save money for the US taxpayer, it will also help solve some of the issues that brought up the 9/11 terrorist attacks.

Hailed by CIA CIO Douglas Wolfe as "one of the most important technology procurements in recent history", the bidding process was marred by controversy.


Microsoft, AT&T and IBM all protested to the US Government Accountability Office forcing the CIA either to go to court or to amend the procurement document.

To win the contract, Amazon will have to build a cloud within the CIA's own virtual secure premises, in other words, a "public cloud built on private premises".

Deals like that one have helped Amazon become one of the fastest growing software businesses in history according to Bloomberg (although AWS doesn't deal in traditional, client-side software).


According to Pacific Crest Securities, web services will bring in a whopping $5 billion for Amazon, up 58% year-on-year, almost matching that of VMWare and, at that growth rate, not far from the likes of Dell, IBM and HP.

Amazon still derives most of its revenues ($74.45 billion) from the traditional retail arm of its business but AWS allows it to generate revenue (and margins) from a completely different audience - businesses and enterprise.

And with web services revenue expected to rise fo $6.7 billion in 2015, one wouldn't bet against Amazon to become the third-largest server company by the end of the decade.