When the cloud eats your contract: a cautionary tale from GAO

EDITOR's NOTE: This story has been updated with a statement from MetTel.

A newly released Government Accountability Office decision that went against MetTel provides a cautionary tale for future contracts as the government seeks to buy more commercial offerings. The decision has stirred debate around cloud procurement practices, competition and the classification of services.

Some context: For around two years, the Social Security Administration used an Avaya-based contact center system, with MetTel providing the toll-free telecommunications services under a competitively awarded EIS contract.

SSA, however, used an existing blanket purchase agreement with Four Points Technology to acquire Amazon Web Services Connect, a contact-as-a-service offering, effectively replacing MetTel’s toll-free services without a new competition in August 2024—a decision the company protested with GAO.  

“Toll-free service isn’t cloud—it’s telecommunications delivered over the public switched telephone network,” MetTel said in a statement to Washington Technology. “The method of delivery remained unchanged. What changed was the vendor—and the justification used to switch providers without recompeting the work.”

Four Points Technology had held a blanket purchase agreement contract for AWS offerings with SSA since 2020 and the agency acquired the AWS contact center services under that BPA. So rather than compete a new telecom contract, SSA used the existing BPA with Four Points Technology for cloud computing services.

This was not a contract termination in the traditional sense. SSA's original task order with MetTel remains in place, but the agency simply started using less of MetTel's services amid the transition to a cloud-based alternative.

The company contends that this reclassification allowed Four Points Technology and AWS to roll in telecommunications revenue under the umbrella of the cloud contract, obscuring the actual scope of services and cost structures. In a statement to Washington Technology, MetTel said it believed this maneuver “not only misrepresented what constitutes a cloud service but also enabled the avoidance of the federal competitive bidding process, contrary to the spirit and letter of acquisition regulations.”

“You wouldn’t classify a power line or an internet connection as part of the cloud,” a MetTel spokesperson said. “Yet that’s essentially what was done here—bundling fundamental, non-cloud telecom infrastructure under a cloud label and removing it from competition.”

MetTel discovered the switch in March as SSA migrated the toll-free lines to the Four Points BPA, according to GAO’s protest decision unsealed Wednesday. GAO ultimately dismissed MetTel’s protest on grounds that the company was not an “interested party” because it does not hold a GSA Schedule contract for cloud computing services. Four Points does have a Schedule contract and that is how SSA is buying the AWS services.

As GAO noted, MetTel "is incapable of providing SSA with the Amazon Connect services required" and would be ineligible for a contract award even if the protest succeeded.

MetTel expressed concerns about the broader implications the decision might have, especially as agencies aggressively pursue cloud cloud-first models.

“This wasn’t just a technicality. It undermined a legitimate, competitively awarded contract to a small business in favor of a large cloud reseller,” the company said. “Taxpayers deserve transparency and fair competition—this precedent jeopardizes both. The GAO’s decision in this case, while focused on procedural grounds, serves as a flashpoint for agencies, integrators, and oversight bodies to re-examine the boundaries between cloud services and legacy infrastructure.”

SSA's acquisition strategy raises important questions for federal contractors because it illustrates how cloud platforms are absorbing functions that were once distinct services.