“Intent to award” notices have been sent out to hundreds of applicants from companies seeking a slice of G-Cloud business.
A £60 million tender was unveiled in October, asking for companies to put themselves forward for contracts – which some 400 firms did, necessitating two deadline extensions.
The buying process itself won’t kick off until March, but the high level of applications has given G-Cloud director, Chris Chant reason to be pleased with progress to date – so much so that the government is planning a second version of the central App Store before the first one has actually gone live Chant predicts:
“My expectation is that from Easter the second iteration of the framework will be out. This time it will enable us to add new suppliers on a monthly basis. That really for me sets the scene for things: we’ll have a living framework and dynamic procurement. ”
Of the bids to date, Chant argues:
“ We've got some prices coming in for Cloud at 10% of prices we know government departments are paying at the moment. We are paying outrageous amounts for IT in some cases. It’s important we generate a competitive marketplace not what we had before. ”
But not everyone is entirely impressed by progress. Joe Dignan, analyst with research firm Ovum, argues that while the tendering is a success in terms of volume, it is:
“less successful in that a number of the biggest pure-play Cloud vendors did not bid on this round. This is something of a surprise to all concerned…One would think that the Cloud specialists would welcome the chance to prove Cloud as an effective platform in government. So why are they not bidding? Ovum would suggest that the fault does not lie with the procurement process run by the Cabinet Office, but a mismatch of requirements between suppliers and government, and the procurement process itself. ”
Dignan challenges what he calls the:
“Orwellian ‘SME good, big company bad’ mantra that has been adopted as a political imperative. No one wants a cartel, and both large and small players have different but important roles to play. However, positive discrimination as a forcing function is widely discredited. By ensuring that the bar was set low for expressions of interest in GCloud in the name of inclusion, the Cabinet Office now has the challenge of doing the necessary due diligence and providing feedback on all 1,739 companies. ”
He also questions what he sees as the adversarial nature of the public sector procurement process:
“If the Cloud specialists are not bidding they will have very good reason for not doing so, and these objections need to be dealt with before the requirements are set. Cloud is all about doing things differently and this requires thinking differently about ROI. ”
But most of all he questions the thinking around the willingness, or not, of the Cloud specialist suppliers to develop public sector-specific business models and private Clouds:
“ It would appear that the Cloud specialists are confident that their existing product offerings and business models are well-suited to an “agile” and “fit-for-purpose” approach in the public sector. Equally, there is a reputational risk in undertaking the delivery of a high-profile public sector program, and the potential rewards must balance the risk. The scope of the program offers more risk than it does reward. ”
But he concludes that there is still time to get things on an even keel:
“We are still a long way from pure-play Cloud companies that feel the Cloud is a free capitalist market that is working efficiently to drive rapid innovation in a new generation of ICT services. The view of Cloud companies appears to be that governments should concentrate on working out how they can safely buy Cloud services from the free market rather than trying to build a restrictive internal government Cloud market that the companies feel is not in the interest of either the agencies of vendors. With the next call for the G-Cloud framework planned for April 2 there is time to make sure we get the process right. ”
