Defra expands AWS engagement with £20m-plus deal

Environment department replaces incumbent contract a year before expiry

The Department for Environment, Food and Rural Affairs has expanded its engagement with Amazon Web Services and signed a £20m-plus deal with the cloud vendor.

Newly released procurement information indicates that Defra entered into a three-year contract with AWS on 1 January. The text of the contract reveals that the department has committed to spend a minimum of about $4.7m each year – but expects to spend almost double this amount: $25m over three years, which equates to £20.8m.

The deal appears to supersede and replace a previous agreement between Defra and AWS which commenced at the start of 2021 and was due to expire at the end of this year. That contract was valued at £3.5m over its three-year term – meaning that its replacement is six times larger.

The deals cover three main service areas, the first of which is AWS’s core cloud-hosting offering. The second is the vendor’s so-called ‘bring-your-own-licence’ service through which organisations can manage software deployments. The final area covered in the Defra deal encompasses support, managed and professional services, and training.

Both the new contract and the engagement it replaces were signed under the terms of the One Government Value Agreement – a three-year memorandum of understanding between AWS and the Crown Commercial Service.

Under the terms of MoU, public sector clients that enter into a three-year contract are offered baseline discounts of 18% on Amazon’s core cloud hosting services. An additional reduction of up to 2% is available to organisations paying for services upfront.

Since the agreement was introduced in late 2020, public sector clients have signed deals with AWS cumulatively worth hundreds of millions of pounds and, in a number of cases, have renegotiated and expanded existing contracts that still have months, or even years left to run.

Sam Trendall

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