Pentagon to Reassess $10B JEDI Contract

By Telecom Tech Outlook | Monday, March 16, 2020

Amazon has alleged that President Donald Trump's detest for Amazon CEO and Washington Post owner Jeff Bezos is a key reason in Microsoft winning the contract


Fremont, CA: The U.S. Department of Defense (DoD) said in a court filing on Thursday that it 'wishes to reconsider' the decision to grant a $10 million JEDI cloud contract to Microsoft.

U.S. Court of Federal Claims Judge Patricia Campbell-Smith, issued a ruling last month to stop Microsoft from working on the Joint Enterprise Defense Infrastructure (JEDI) cloud contract. The cloud contract was awarded to Microsoft on October 25, despite the fact that Amazon was a front-runner to be considered for the contract. Lawyers of the U.S. government asked a federal judge to grant Pentagon "120 days to reconsider certain aspects of the challenged agency decision".

Though Campbell didn't release her written opinion, she has ordered Amazon to post $42 million due to the wrong issue of the injunction, while Amazon said that Microsoft's Azure cloud infrastructure doesn't meet the technical requirements set by Pentagon.

"DoD does not intend to conduct discussions with offerors or to accept proposal revisions with respect to any aspect of the solicitation other than price scenario," according to the filing. The Pentagon wants to have another look at parts of the bidders' price proposals and online marketplaces.

Amazon has asked the U.S. Defense Department to cease the award and carry out another review of the submitted proposals. Amazon has also alleged that President Donald Trump's detest for Amazon CEO and Washington Post owner Jeff Bezos is a key reason in Microsoft winning the contract.

The JEDI contract, which was supposed to be awarded in September 2018, was delayed due to some of the competing companies who contended that Amazon had an unreasonable advantage. A number of investigations and legal battles slowed down the process. Cloud giants including Oracle, Amazon, Microsoft, and IBM were all in a race for the JEDI contract. The award was set up to give the contract to just one cloud company.

Wedbush Securities analyst Daniel Ives said that he believed Pentagon would split the JEDI contract. "While initially, this was a single-source contract, we believe the writing is on the wall that the Pentagon needs to likely break up this contract in order to move it along and start the procurement process given how critical the JEDI deal is to the overall DOD and longer-term strategic global military operations/infrastructure," Ives wrote in a note to clients.

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