Microsoft Corporation has secured a $170.4 million contract from the U.S. Department of War to supply Azure cloud computing services for the Air Force's Cloud One Program. The project involves delivering cloud infrastructure solutions to assist the Air Force and its customers, with work centralized at Microsoft's locations across the contiguous United States. The contract, awarded via a sole source acquisition and managed by the Air Force Life Cycle Management Center at Hanscom Air Force Base, is set to conclude by December 7, 2028, with initial funding of nearly $1.95 million allocated for fiscal year 2026 operations and maintenance.
Key Points
- The contract value is $170.4 million for providing cloud services to the U.S. Air Force’s Cloud One Program.
- Microsoft received the contract through a sole source acquisition, indicating no competing bids were considered.
- The project will be executed at Microsoft’s facilities across the contiguous United States and is scheduled to last until December 7, 2028.
- Initial funding of approximately $1.94 million has been obligated for fiscal year 2026 operations and maintenance.
Microsoft Corporation, a leader in cloud and technology solutions, has been awarded a firm-fixed-price task order totaling $170,444,462 from the U.S. Department of War to support the Air Force’s Cloud One Program. This contract secures Microsoft Azure cloud service offerings to reinforce the Air Force’s efforts in modernizing and maintaining its cloud infrastructure. The scope of work is designated to be performed at Microsoft facilities within the contiguous United States, facilitating support directly aligned with the Air Force’s operational needs.
The contractual agreement arises from a sole source acquisition process, highlighting that Microsoft was uniquely chosen for this task order without competing bids. Oversight and management of the contract fall under the jurisdiction of the Air Force Life Cycle Management Center based at Hanscom Air Force Base in Massachusetts, with the specific contract reference FA8726-26-F-B007.
The timeline for the program extends through December 7, 2028, reflecting a long-term commitment to cloud service delivery for the military branch. At the time of award, the Department of War allocated $1,944,400 in fiscal year 2026 funds dedicated to operations and maintenance, signifying the initial funding phase for this undertaking.
Microsoft’s involvement with the Cloud One Program underlines their pivotal role in providing advanced cloud infrastructures to national defense initiatives. This partnership demonstrates an integration of commercial cloud technology within governmental defense frameworks, reinforcing IT modernization efforts.
While detailed operational specifics are not disclosed, the contract underscores the strategic importance of cloud capabilities in military applications and the reliance on trusted technology providers to fulfill these requirements.
Risks
- The sole source nature of the acquisition limits competition, which may present operational risks if Microsoft encounters unforeseen challenges.
- Dependence on cloud infrastructure introduces potential cybersecurity and service continuity risks critical to defense applications.
- The long project duration implies that evolving technology requirements or funding shifts could impact contract execution.