Pentagon Sticks With Microsoft Over Amazon for $10B Contract

The Pentagon is seen from Air Force One in 2011. (AP Photo/Charles Dharapak, File)

(CN) — The Pentagon announced Friday that it has completed a reevaluation of cloud computing proposals and will award a $10 billion contract to Microsoft instead of Amazon, despite a court order blocking the contract in light of claims that President Trump’s bias against Amazon influenced the decision.

Numerous delays and controversies have plagued the JEDI, or Joint Enterprise Defense Infrastructure, deal, including a 10-month legal battle initiated by Amazon Web Services after the Department of Defense originally awarded the contract to Microsoft in October 2019.

The contract is intended to update and consolidate the Pentagon’s IT infrastructure and is worth up to $10 billion for services rendered over the next 10 years.

“The department has completed its comprehensive reevaluation of the JEDI cloud proposals and determined that Microsoft’s proposal continues to represent the best value to the government,” the Pentagon said in a statement Friday.

In response to the announcement, a Microsoft spokesperson said the company is “ready to get to work and make sure that those who serve our country have access to this much needed technology.”

Once considered the frontrunner for JEDI due to its existing government contracts, Amazon Web Services, Amazon’s cloud computing unit, sued last November in the U.S. Court of Federal Claims to challenge the decision.

Amazon alleged that the president illegally interfered to direct the contract to Microsoft out of his personal dislike for Amazon CEO Jeff Bezos, who also owns the Washington Post. Trump has frequently criticized the Post for what he views as unfair coverage of his administration.

In its complaint, Amazon argued that the president engaged in a “blatant and sustained effort to direct the outcome” of the contract award and noted several statements by Trump that were critical of the company, including one where the president allegedly told then-Defense Secretary Jim Mattis to “screw” Amazon.

In February, a federal judge temporarily blocked the deal from moving forward while Amazon’s lawsuit is litigated, finding that Amazon was likely to prove the Pentagon made at least one error while evaluating the two applications and that the error affected the outcome.

The Pentagon eventually pulled the award to make corrections and invited Amazon and Microsoft to revise and resubmit their proposals for the contract.

A Defense Department watchdog found in April that the Pentagon did not violate laws or regulations when awarding the contract to Microsoft. Although the inspector general’s report found that Pentagon employees who evaluated and awarded the contract did not feel pressured by senior agency or White House officials, an executive privilege claim prevented the inspector general from fully reviewing whether the White House exerted any influence in steering the contract away from Amazon due to the president’s personal feelings.

The Pentagon’s statement Friday acknowledged that contract performance cannot begin immediately due to the court order but said the department “is eager to begin delivering this capability to our men and women in uniform.”

In a blog post Friday, the Amazon Web Services Public Sector Blog Team said the Pentagon’s reevaluation of the two proposals was “nothing more than an attempt to validate a flawed, biased, and politically corrupted decision.”

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