Why data is key to GSA's e-commerce plan

Nearly two years ago, the General Services Administration began a journey to develop an online marketplace for federal acquisition at the behest of Congress.

In Congress, the e-commerce platform idea was dubbed "Amazon for government," and the provision was tucked in the 2018 National Defense Authorization Act signed in December 2017.

Earlier this month, GSA rolled out the initial vehicle it wants to use to test its online purchasing platform pathway. In a solicitation, GSA asked commercial e-commerce platform providers to compete for its "proof of concept" model that will give federal buyers with government purchase cards an online marketplace where they can buy commercial products priced below the micropurchase threshold of $10,000.

Brock Lyle, associate general counsel at commercial platform Overstock.com, said at a January, 2018, GSA town hall meeting on the e-commerce initiative that a competitive, properly implemented platform could bring down average prices paid by government.

"If it's competitive, it could bring a significant shift," he said. "The government would be driving things and allowing businesses to compete for that business." At the town hall meeting, Lyle and Rob Bohn, senior counsel at Amazon Business, urged GSA to set the rules of the road for sellers, treading closely to already established requirements for sellers.

GSA's proof of concept solicitation seeks at least two vendors to offer their products and those of third-party providers.

This model is one of three e-commerce structures that had been discussed early in the process. GSA opted against allowing providers to sell exclusively their own proprietary or wholesale products and against allowing a software-as-a-service system bringing together existing ecommerce offerings to be managed by buyers.

Responses on the proof of concept solicitation are due Nov. 1. That  quick turnaround for responses, according to Alan Chvotkin, vice president and general counsel the Professional Services Council, suggests GSA has some interested platform providers who already had a good idea of what's in the solicitation.

Amazon and Overstock declined to comment on this story.

GSA has been cautious and deliberate in developing the solicitation over the last year, with open dialogs with industry through industry days and other outlets, Chvotkin said.

"There aren't any surprises" in the RFP for potential providers who have been following the agency's development effort, he said.

Chvotkin explained that with the proof of concept solicitation, GSA is looking for competition at two levels. It wants two platform providers that federal buyers could choose between, as well as competitive order-level competition for products on each platform.

Data details

From the beginning, the transactional data that platform providers might glean from federal buyers has been a major attraction for vendors and a possible obstacle for government. Restrict access to that data too much and potential providers lose interest. Allow too much access to competitive data and it's too prohibitive for providers to participate.

"GSA is walking a tightrope" with how it handles data in the trial, said Chvotkin. "Vendors have to have data, but how do you prevent it being used for other purposes?" he asked.

Alan Thomas, until recently commissioner of GSA's Federal Acquisition Service, told FCW on Oct. 8, that data "is the most important thing."

"We're pretty clear in the RFP in terms of what we want with respect to data," Thomas said. "There is definitely some data that we would consider government sensitive and we're not going to share out."

The solicitation prohibits the platform providers from using the government spend data they get to develop pricing and marketing strategies on their commercial services.

There's also a plan to offer data visibility to federal buyers, including price comparisons, product origins for supply chain security purposes and warranty information. The solicitation also calls for access for platform providers to develop savings information and other spending data. The platform provider also has to give buyers real-time catalog information to GSA that will allow buyers to watch pricing.

GSA's solicitation requires bidders to provide a "detailed" plan on how they will handle data they get from federal buyers on the platform.

"I think we've got a pretty thoughtful plan there," Thomas said. "It's proof of concept, so we might get it out there and find that something's not working and change."

The next phase of development after the proof of concept, he said, will probably get into details of how to limit commercial use of government data, Chvotkin said.

"This solicitation won't get at all" of the concerns about data on the commercial or government side, Chvotkin agreed. "It's important, however, that GSA test out a robust pilot in this segment" before it can move ahead with bigger plans, he said.