The Pentagon said Friday it will stick with Microsoft for a massive $10 billion cloud computing contract, snubbing rival Amazon Web Services for a second time.
In a statement, the Defense Department said it has completed a lengthy reevaluation of bids for the 10-year Joint Enterprise Defense Infrastructure (JEDI) contract, which is a central part of the military’s 21st-century strategy to deliver real-time data to personnel stationed all over the world.
Microsoft and Amazon were the two only companies left in the running at the time of the original award in October.
Amazon protested the decision and claimed that President Trump’s disdain for the company led the Pentagon to choose Microsoft. Amazon maintains it is the best choice for JEDI — informally known as the Pentagon’s “war cloud” — and argued Friday that the entire process has been “politically corrupted” by the president.
The company’s objections sparked a thorough review inside the Pentagon, but officials said Microsoft remains the best choice.
“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 Defense Department said in a statement. “The JEDI Cloud contract is a firm-fixed-price, indefinite-delivery/indefinite-quantity contract that will make a full range of cloud computing services available to the DoD. While contract performance will not begin immediately due to the preliminary injunction order issued by the Court of Federal Claims on Feb. 13, 2020, DoD is eager to begin delivering this capability to our men and women in uniform.”
Indeed, work on the JEDI contract cannot begin right away because of legal actions Amazon has brought against the Defense Department.
The company vowed that the legal case will continue and said it has grown even more confident in its position.
“We strongly disagree with the DoD’s flawed evaluation and believe it’s critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence,” Amazon said in a blog post published Friday afternoon. “The question we continue to ask ourselves is whether the president of the United States should be allowed to use the budget of the Department of Defense to pursue his own personal and political ends?”
A previous investigation by the Pentagon inspector general found that the Defense Department followed the law when awarding the contract to Microsoft, but Amazon argued that probe did not address which company would actually be the best choice to do the work.
Friday’s announcement, however, directly addresses the merits of the award and seemingly represents the final step of the administration’s internal review process. The case now is expected to play out in federal court, where Amazon likely will argue that the president’s public and private criticism of the company kept it from winning the contract.
For example, a top aide to former Defense Secretary James Mattis, Guy Snodgrass, claimed in a recent book that Mr. Trump told Mr. Mattis to “screw Amazon” out of the award.
The White House and Pentagon have vehemently denied that allegation, but Amazon has used it as a central pillar in its argument.
“There is a recurring pattern to the way President Trump behaves when he’s called out for doing something egregious: first he denies doing it, then he looks for ways to push it off to the side, to distract attention from it and delay efforts to investigate it (so people get bored and forget about it). And then he ends up doubling down on the egregious act anyway,” the company said. “On JEDI, President Trump reportedly ordered former Secretary Mattis to ‘screw’ Amazon” and took other steps to interfere in the process.”
For Amazon, the loss of the contract means the loss of billions of dollars while its rival, Microsoft, is now poised to be the forefront of technological advancement in the military. The JEDI contract will cover the storage and processing of huge amounts of classified Pentagon data, and military officials say the project is crucial for national security in the 21st century.
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