Two senators are looking to reign in the outsized influence tech giants such as Google, Microsoft and Amazon have over the cloud computing and artificial intelligence defense contracting space.
Sens. Elizabeth Warren, (D-Mass.), and Eric Schmitt, (R-Mo.), introduced legislation on Thursday that, if passed, would require the Defense Department to ensure there is a “competitive award process” when procuring cloud computing, data infrastructure and AI models.
“Right now, all of our eggs are in one giant Silicon Valley basket. That doesn’t only stifle innovation, but it’s more expensive and it seriously increases our security risks. Our new bill will make sure that as the Department of Defense keeps expanding its use of AI and cloud computing tools, it’s making good deals that will keep our information secure and our government resilient,” Sen. Warren said in a statement.
Warren, a vocal critic of big tech giants, has long called for breaking them up — she campaigned in 2020 on the message that big technology companies have “bulldozed competition” and “squashed small business and innovation.”
Meanwhile, Schmitt, who is on the Senate Armed Services Committee along with Warren, has expressed concerns in the past about the Defense Department’s overreliance on major technology companies for cloud computing and cybersecurity services and has advocated for increased competition to drive innovation in the defense sector.
“Competition and innovation are critical drivers of the Department of Defense’s ability to maintain its strategic advantage, ensuring that defense contractors, technology developers, and internal DoD teams are constantly striving to deliver cutting-edge solutions,” Schmitt said.
Specifically, the new bill would require the Defense Department to have a competitive award process when contracting with cloud, advanced AI systems, or data infrastructure vendors that enter into contracts of $50 million or more with DoD annually.
The bill would also require the Defense Department to ensure that it maintains exclusive rights to access and use of all government data.
The DoD’s contracting process would have to prioritize the “appropriate role for the government” with respect to intellectual property and data rights and security, interoperability, and auditability requirements; incorporate modular open systems approaches and “appropriate work allocation;” and consider multi cloud strategy where “feasible and advantageous.”
The bill would also mandate the Pentagon’s chief digital and artificial intelligence office to update the Defense Federal Acquisition Regulation Supplement provisions to make sure that government data provided by the government for development and operation of AI products to DoD won’t be disclosed or used without authorization from the DoD.
In addition, the CDAO would have to ensure that government data stored on vendors’ systems is protected from other data on those systems and segregated from other data on their systems and complies with DoD’s data decrees and Creating Data Advantage (Open DAGIR) principles.
Vendors who violate these provisions would face penalties, including fines or contract termination, according to the bill.
DoD would also be required to publish a report every four years examining competition, barriers to entry for small companies and market power concentration in the AI sector.
The bill comes at a time when the Pentagon is pouring billions of dollars into AI and cloud services — just last month it came out with the first draft of what could be the biggest government AI contract in history.
And in 2022, the Pentagon awarded the Joint Warfighting Cloud Capability contract, which could be worth up to $9 billion over 10 years, to Google, Oracle, Microsoft and Amazon. Although DoD officials have shared they are looking to include more providers in the next phase of the program.
This is the first time Warren and Schmitt have collaborated on legislation, bringing two sides of the aisle together in an attempt to reign in the dominance of tech giants. The legislation would have to pass the House and Senate before getting enacted.
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