£700m government hosting deal limits bidders to North-East England datacentre

Companies bidding to win a £700m government hosting contract will need to have a major datacentre in the north-east of England to stand a chance of winning the deal, Computer Weekly has learned. 

Cabinet Office plans for cheaper, more flexible datacentre hosting using new suppliers could be hindered by the need to conform to a legacy Department for Work and Pensions (DWP) contract.

Under the terms of the recently published £700m Crown Hosting Service (CHS) tender, Whitehall is looking for "small, pragmatic solutions" to allow government to use "more agile, efficient and better-value-for-money commodity services" to host a variety of existing datacentres.

But the tender notice includes a specific requirement relating to existing DWP datacentres in the north-east of England.

Effectively, any companies hoping to win the CHS contract can only offer their services if they have a datacentre less than 50 miles away from both of DWP’s existing HP-hosted datacentres in Wynyard and Doxford, near Newcastle.

Such requirements are bound to limit the number of potential suppliers and could put HP in pole position to win the bid.

The CHS deal specifies a latency less than 0.5 milliseconds from the two HP/DWP sites.

The tender notice for the procurement of infrastructure for the Crown Hosting Service across government said: “In particular, a proportion of DWP's current application demand may be subject to the requirement for any datacentre it uses to have a latency of less than 0.5 milliseconds (round trip delay) from either of DWP's current sites at Wynyard and Doxford in North-East England.”

Latency is the amount of time it takes for a packet of data to get from A to B and back again. The higher the latency, the longer it takes to move data around.

A latency of 0.5 milliseconds is a small time lag, according to Daniel Beazer, a datacentre specialist at consultancy BroadGroup. By comparison, latency from the UK to the US is 30 to 40 milliseconds.

Under perfect conditions, and assuming the data is travelling in a straight line over fibre-optic links, latency of 0.5 milliseconds equates to a maximum round-trip distance of 93 miles. Any CHS datacentre must therefore be less than 46.5 miles away from the Wynyard and Doxford sites.

Wynyard and Doxford are approximately 24 miles apart - so, to be no more than 46.5 miles away from both sites would reduce the geographic availability of a potential new datacentre even further.

Beazer said latency is best delivered by fibre installed in straight lines, and also depends on the equipment used and how much traffic is put through the network. “Think of it as a road network,” he said. “If there’s no one on it you can go pretty fast."

But he said that a latency of 0.5 milliseconds would drastically restrict the location of the proposed datacentre.

“I think you’re looking at that North-East area,” said Beazer.

The Cabinet Office blamed old contracts inherited from the previous government.

“These contracts have a technical requirement for some older DWP datacentres to be located close to each other to work effectively,” said a spokesman.

“We are looking to the market to provide the most effective solution. This could include consortia bids or subcontracting arrangements.”

As HP is the incumbent supplier at DWP’s datacentres in Wynyard and Doxford it is likely to put the supplier in a prime position to win the contract.

The aim of the Crown Hosting Service is to support government applications, which are not yet ready to move to the cloud and still need legacy datacentre hosting. The first departments expected to transfer workload into CHS are DWP, the Home Office and the Highways Agency.

Earlier this month, the Government Digital Service (GDS) invited suppliers to bid for a joint venture partner to provide datacentre co-location services from at least two separate locations, which will be available to central government as well as the wider public sector.