Amazon Gets Its Wish: Federal Judge Says Microsoft Has to Halt JEDI Work
Microsoft earlier this week was slated to start work on the giant Joint Enterprise Defense Infrastructure (JEDI) cloud computing project at the U.S. Department of Defense but, on Thursday, a federal judge put the kibosh on those plans.
The move, which is temporary, came two days after Microsoft was supposed to take the initial steps on JEDI implementation. However, legal tactics from its biggest competitor, Amazon Web Services, which expected to take home the JEDI contract, interfered with those plans.
AWS filed its much-expected lawsuit not long after the DoD awarded JEDI – which could be worth up to $10 billion – to Microsoft Azure. AWS contends President Trump’s longstanding beef with Amazon founder and The Washington Post owner Jeff Bezos directly led to Microsoft landing JEDI. In fact, the company wants to depose the president. Whether that effort will be successful remains unknown.
Meantime, the federally imposed work stoppage comes as little surprise to Shelly Kramer, founding partner and principal analyst at Futurum Research.
“This isn’t about capabilities, it’s about a presumption of fair and equitable processes in the vetting and selection of candidates in a government bidding process,” she wrote in a Feb. 13 blog. “Ask Oracle and IBM how they feel about this — they have all the feelings on this front.”
Indeed, the whole JEDI process has been fraught with disagreements and lawsuits. Kramer, for her part, suspected all along that Microsoft would end up with the contract, “largely not because of the company’s qualifications, but because the current administration has made no secret of its animosity toward Amazon’s Jeff Bezos.”
That’s not to say, she added, that Microsoft hasn’t proven itself. In fact, it’s important to note that Microsoft Azure has an extensive track record within the federal government and recently secured certification to allow it to store classified data in the cloud.
“I believe Microsoft is both prepared and capable of doing exactly what it is the DoD seeks with regard to the consolidation of its cloud services with one vendor,” Kramer wrote. “Bottom line, both Amazon and Microsoft are fully capable of undertaking this project and delivering stellar results.”
Not all industry analysts have been convinced by Amazon’s argument. At least one, Beth Kindig, has said Microsoft Azure is the superior choice when it comes to cloud security and working with the government.
Meantime, both Microsoft and the DoD are expressing frustration over the temporary halt on Azure’s JEDI implementation.
Here’s Microsoft’s official statement, given to CNBC: “While we are disappointed with the additional delay we believe that we will ultimately be able to move forward with the work to make sure those who serve our country can access the new technology they urgently require. We have confidence in the Department of Defense, and we believe the facts will show they ran a detailed, thorough and fair process in determining the needs of the warfighter were best met by Microsoft.”
The Department of Defense told CNBC it’s disappointed in the ruling and believes the actions tied to the AWS litigation “have unnecessarily delayed implementing DoD’s modernization strategy and deprived our warfighters of a set of capabilities they urgently need. However,” spokesman Lt. Col. Robert Carver said, “we are confident in our award of the JEDI cloud contract to Microsoft and remain focused on getting this critical capability into the hands of our warfighters as quickly and efficiently as possible.”
Futurum’s Kramer similarly noted that holdups in the JEDI process really only hurt one party: “The Department of Defense and the entities within the government who stand to benefit from both consolidation of cloud services and best-in-class cloud services offerings that either vendor could provide.”
Even so, she predicts the AWS lawsuit will not change the outcome of who owns JEDI.
“The reality of the administration today is that it largely does what it wants, with whom it wants and lets pretty much nothing get in the way,” she wrote. “To me, this is a completely understandable move by Amazon to fight what is probably best described as intervention at the highest levels to assure the award didn’t go to Amazon. With Amazon’s pocketbook, it can afford to file this lawsuit and incur the costs associated with fighting this fight. In fact, if I was AWS, I’d be all in on this fight.”