DTA to launch cloud marketplace in 2020

By Shannon Jenkins

Tuesday October 22, 2019


The Digital Transformation Agency has invited feedback on its plans to launch a cloud services marketplace.

The proposal outlined in the DTA’s discussion paper aims to respond to changing buyer needs in the cloud services industry, while achieving value-for-money for government agencies. 

The government’s current cloud services panel hosts more than 500 cloud services from roughly 240 sellers — more than 70% of which are SMEs. According to the DTA, the panel has facilitated more than $130 million in government cloud contracts since it was launched in 2015.

But the agency has argued that new offerings like ICT applications, processes, functions, and network connectivity are challenging the traditional view of cloud computing. They have found that digital sourcing arrangements are shifting from traditional deals to a more flexible marketplace concept.

According to the DTA, agencies value security accreditation, location, and transparency of deployment models when buying cloud services. Buyers are looking for more evolved cloud services, and are showing an increased readiness to adopt cloud-centric managed services when outsourcing their ICT requirements.

The proposed marketplace aims to address these changes and achieve “value-for-money outcomes for government agencies when buying cloud offerings” by:

  • establishing a sourcing arrangement flexible enough to accommodate industry developments and technology advances in cloud computing;
  • giving buyers access to a range of cloud offerings;
  • simplifying the buying process;
  • promoting increased participation from Australian SMEs;
  • providing a modern, flexible, competitive and accessible cloud offerings marketplace to buyers; and
  • shortening buyer timelines and reducing costs when buying cloud offerings.

The DTA plans to set up the CMP in two phases. Phase one involves the selection of “capable sellers”, which will be based on their commercial stability, capacity, capability, and compliance with terms and conditions. This phase is expected to be completed in early 2020, with the marketplace up and running by July 2020. In phase two, the DTA will review and approve cloud offerings from the chosen sellers. This will be ongoing as cloud offerings could be added to the marketplace catalogue as they become ready to meet market demands.

The DTA will then conduct assessments of seller requests to review the technical merits and value-for-money of each cloud offering. Sellers will follow an online submission process through the agency’s ICT Procurement Portal.

The new marketplace will be simple to use and cost-efficient to run, the DTA says, the number of cloud offerings per seller will be limited. The DTA has encouraged feedback on the “optimal limit” of cloud offerings in its discussion paper.

However, the agency has noted that current panel sellers will not be able to transition to the new CMP. Those on the CSP will “cease operations” when its term expires in March 2020, and will have to reapply to be considered for the new marketplace.

The DTA says it has also been thinking about updating its contracting framework for the marketplace, “subject to feedback and legal advice”. It has proposed a short-form agreement with a seller rating, where sellers selected to the CMP will need to accept and execute a short-form agreement. The DTA will write the agreement in language that is “easy to understand for people who do not have legal training” and make other changes, such as including “only essential and non-negotiable Commonwealth contractual requirements” in the terms and conditions.

The DTA argues this new approach will benefit SME’s and be more efficient than the traditional contracting approach, which requires sellers to negotiate and execute a common long-form agreement. 

The discussion paper is open until November 13.

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