December 05, 2024

Warren, Schmitt Introduce Bipartisan Bill to Encourage Resiliency, Competition in DoD Procurement of AI, Cloud Computing Tools

New bill offers meaningful guardrails to promote competition, protect national security

Text of Bill (PDF) | One-Pager (PDF)

Washington, D.C. – Senators Elizabeth Warren (D-Mass.) and Eric Schmitt (R-Mo.) introduced the bipartisan Protecting AI and Cloud Competition in Defense Act to ensure that the Department of Defense (DoD)’s procurement of artificial intelligence (AI) and cloud computing tools prioritizes resiliency and competition. The bill offers meaningful regulation to limit Big Tech monopolies from elbowing out competitors in the AI and cloud computing markets.

Government contracts play a powerful role in shaping markets. DoD has already awarded $9 billion in contracts to Google, Oracle, Microsoft, and Amazon to build its cloud computing network, and has requested an additional $1.8 billion for AI programs for fiscal year 2025. The Protecting AI and Cloud Competition in Defense Act will ensure that DoD’s new contracts protect competition in the AI and cloud computing markets, instead of giving an unfair advantage to a few big players. The bill also encourages DoD to consider cloud computing services from multiple providers so the agency isn’t locked in by a single tech company, which also limits national security risk.

Specifically, the bill would: 

  • Require DoD — when contracting with cloud, foundation model, or data infrastructure providers that enter into contracts of $50 million or more with DoD annually — to administer a competitive award process, ensure that the government maintains exclusive rights to access and use of all government data, and consider multi-cloud technology where feasible and advantageous. 
  • Require DoD’s Chief Digital and Artificial Intelligence Office (CDAO) to ensure that government data provided for the purpose of development and operation of AI products to DoD will not be disclosed or used without DoD authorization, and such government data, if stored on vendor systems, is appropriately protected from other data.
  • Require DoD to publish a report every four years on competition, innovation, barriers to entry, and market power concentration in the AI sector, with recommendations for legislative and administrative action.

“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,” said Senator Warren. “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.”

“I am proud to work with Senator Warren on the ‘Protecting AI and Cloud Competition in Defense Act of 2024’, which will encourage resiliency, interoperability, and innovation,” said Senator Schmitt. “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 in an increasingly complex and dynamic global security environment.”

The Protecting AI and Cloud Competition in Defense Act is endorsed by the American Association of People with Disabilities, Economic Securities Project Action, Encode Justice, and the Open Markets Institute.

“It is imperative that we act swiftly to harness the potential of AI to spur innovation, rather than allowing the industry to entrench their narrow interests. Senator Warren’s Protecting AI and Cloud Competition in Defense Act is common-sense legislation that encourages dynamism and resiliency in our country’s cloud computing infrastructure. The Department of Defense has itself identified that consolidation in parts of the private defense industry poses a threat to national security; this legislation would leverage the government’s procurement power to mitigate consolidation and encourage competition in the broader digital economy,” said Taylor Jo Isenberg, Executive Director of Economic Security Project Action.

“The Protecting AI and Cloud Competition in Defense Act will strengthen America's resilient defense technology ecosystem through rigorous procurement standards. This legislation establishes essential safeguards for government data while ensuring the Department of Defense can leverage competitive markets to advance our national security capabilities,” said Sunny Gandhi, VP of Political Affairs at Encode Justice.

"Without reform to the federal tech procurement process, the Department of Defense is likely to fall victim to and further entrench the concentrated power of the tech industry," said Ramsay Eyre, a senior policy analyst at the Vanderbilt Policy Accelerator. "Policies like the ones in this bill will promote competition in AI and cloud computing through DoD's procurement power."

Senator Warren has been a leader in the fight to rein in Big Tech and strengthen antitrust enforcement to boost competition in the tech industry:

  • In September 2024, Senator Warren wrote to Assistant Attorney General of the Antitrust Division at the United States Department of Justice (DOJ) Jonathan Kanter in support of the DOJ’s ongoing probe into Nvidia’s potentially anticompetitive behavior.
  • In August 2024, Senator Warren wrote to Tesla’s Board of Directors with concerns over CEO Elon Musk’s continued conflicts of interest and misappropriation of company resources, and the Board’s failure to hold him accountable. 
  • In August 2024, Senator Warren and Representative Lori Trahan (D-Mass.) wrote a letter to OpenAI, seeking answers about how the company handles whistleblowers and safety reviews after former employees complained that internal criticism is often stifled.
  • In February 2024, Senator Warren delivered the keynote address at RemedyFest, where she called out Big Tech for their anti-competitive tactics that have led to market consolidation and record profits.
  • In January 2024, at a hearing of the Committee on Banking, Housing and Urban Affairs, Senator Warren questioned Emily Kilcrease, Senior Fellow and Director of the Energy, Economics, and Security Program at the Center for a New American Security, on the national security risks posed by digital trade rules that allow tech companies to collect, sell, and store Americans’ data wherever is cheapest, including China.
  • In December 2023, Senators Warren, Amy Klobuchar (D-Minn.), and Bernie Sanders (I-Vt.), along with U.S. Representatives Mary Gay Scanlon (D-Pa.), Hank Johnson (D-Ga.), Pramila Jayapal (D-Wash.), Jan Schakowsky (D-Ill.), Lori Trahan (D-Mass.), and Rosa DeLauro (D-Conn.), sent a letter to President Biden, urging him to continue to reject any trade or policy proposals from Big Tech that would deem the European Union’s Digital Markets Act (DMA) to be discriminatory or an illegal trade barrier, in order to protect the administration’s shared pro-competition priorities with its European allies. 
  • In November 2023, Senator Warren and U.S. Representative Jan Schakowsky (D-Ill.), led 10 lawmakers in a letter to President Joe Biden, commending his administration’s actions countering Big Tech’s influence in trade negotiations, and asking him to replace “digital trade” provisions lobbied for by Big Tech in Indo-Pacific Economic Framework (IPEF) negotiations with new language to ensure regulatory agencies and Congress are able to counter Big Tech abuses and develop a new model for digital rules in trade agreements that promotes competition and protects workers, consumers, and small businesses. 
  • In July 2023, Senators Warren and Graham introduced the Bipartisan Digital Consumer Protection Commission Act which would  rein in Big Tech by establishing a new commission to regulate online platforms. The commission would have concurrent jurisdiction with FTC and DOJ, and would be responsible for enforcing the new statutory provisions in the bill and implementing rules to promote competition, protect privacy, protect consumers, and strengthen our national security.
  • In May 2023, Senator Warren released a 22-page investigative report: Big Tech’s Big Con: Rigging Digital Trade Rules to Block Antitrust Regulation. The investigation, based on a review of previously undisclosed emails, reveals that Big Tech is using its revolving door hires to gain backdoor access to key United States Trade Representative and Commerce Department officials, undermining the Biden Administration’s promises to end rigged trade deals and protect workers, consumers, and the environment. 
  • In October 2022, Senator Warren and Representative Jayapal sent a letter to Secretary Raimondo underscoring the dangers of Big Tech’s digital trade agenda, following up on a letter the lawmakers sent to Secretary Raimondo in July 2022 requesting additional information about the revolving door between Commerce and Big Tech and its potential impact on global digital trade rules.
  • In July 2022, Senator Warren and Representative Jayapal sent a letter to Secretary Raimondo raising questions about the revolving door between the Department of Commerce and Big Tech companies, and its potential impact on global digital trade rules.

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