Home Office cloud services contract may net AWS £1B

Planning notice puts renewal at nearly twice the 2023 value, just as Whitehall frets about US tech dependence 

Amazon Web Services (AWS) looks set to win more than a billion pounds of UK taxpayers' money under for a new Home Office contract for public cloud hosting. 

A planning notice, published on October 30, covers the renewal of the department's public cloud services, to meet its current and future hosting needs. The estimated value is £881,621,007 ($1.18 billion), which passes £1 billion once VAT is included.

AWS won the existing contract with the Home Office in 2023 for about £450 million (c $603 million). The Register has asked the Home Office why the figure has risen so much, and will update this article if it responds.

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Once awarded, the contract is expected to run from December 2027 to December 2029, with a possible extension to December 2031 (four years in total). A market engagement event for suppliers on the G-Cloud 15 Lot 1A procurement framework is scheduled for December 8, giving bidders the chance to pitch.

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The Home Office would not say who else is being considered, saying it does not comment on ongoing procurement.

The notice lands as digital sovereignty becomes a bigger problem in the UK and across Europe, amid suspicion that US authorities have cut off access to American technology for political reasons. A survey found that about three-quarters of businesses in the UK, France, and Germany fear Washington could abruptly sever access to the US tech platforms they rely on.

Earlier this year, the Open Rights Group warned politicians that the UK is far too dependent on US technology companies to run critical operations.

Whitehall is mindful of its over-reliance on American hyperscalers. As The Register revealed in 2024, the Cabinet Office admitted - in an internal document seen by us - that the government’s negotiating power had been inhibited by vendor lock-in.

It said the "UK government’s current approach to cloud adoption and management across its departments faces several challenges" which combined result "in risk concentration and vendor lock-in that inhibit UK government’s negotiating power over the cloud vendors." It acknowledged "the existing dominance of AWS and Azure in the UK Government’s cloud services is set to continue."

A source at one supplier that works with the public sector said the UK administration was "failing to support UK [cloud] providers, it says they can’t meet scale and that is garbage." They claimed that in many cases the government people writing the tenders are advised by professional services companies to favor the hyperscalers. The professional services companies are then "rewarded" as migration or integration partners, our source claimed.

The UK government also pledged to steer more business to  small-to-medium sized enterprises (SMEs) in an action plan published last month. In August it added smaller, local suppliers to G-Cloud 15, though a place on the framework does not guarantee any business.

Pledges like this are nothing new, and they have largely come to nothing, as we reported in 2005, 2013, 2016, and 2018. 

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According to public sector intelligence platform BidSkim, AWS takes 75 percent of the government money on cloud contracts, worth about £1.22 billion ($1.6 billion). It estimates that Microsoft Azure has more contracts, but these are smaller and add up to £355 million ($475 million), while Google Cloud is on £47 million ($63 million) and Oracle Cloud $15 million ($20 million).