[ksec]

But why would any agency chooses smaller cloud providers other than Oracle, AWS, Azure and Google? They are the lowest risk selection in terms of responsibility.

Edit: Another comments actually replied it is much more than hosting but cloud services like BOX. I assume even SaaS could fall into this category.

[Spooky23]

They tend to converge on each other. Also the Feds may have particular needs for connectivity, location, etc.

[cyberge99]

To stay off the radar. To do shady stuff at a small company that you can easily control/manipulate.

[justincormack]

SaaS companies, not just cloud providers.

[tguvot]

Saas is most common use case