September 14, 2020
It’s official: The $10 billion Joint Enterprise Defense Infrastructure (JEDI) cloud computing contract will remain with Microsoft Azure.
After nearly a year of legal battles raised by Amazon Web Services, a contender for the coveted project, the Pentagon decided to stick with Microsoft.
“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 Department of Defense said in a prepared statement on its website. “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.”
AWS has taken issue with the decision, chalking it up to President Trump’s public feud with Amazon CEO Jeff Bezos. AWS, as Oracle did, also is pushing back against the single-vendor structure for JEDI.
“Given the DoD did not agree to meaningfully review the many evaluation flaws outlined in our protest, we said the corrective action was likely to result in another contract award based on politics and improper influence and not based on the relative strengths of the two offerings,” the company wrote in a blog. “That is exactly where we find ourselves today, with the DoD’s reevaluation nothing more than an attempt to validate a flawed, biased and politically corrupted decision. It’s also important to point out that the DoD cited price as a major factor in the previous decision. This time, AWS offered a lower cost by several tens of millions of dollars. The DoD’s decision to intentionally ignore the clear cost benefits offered by AWS reinforces the fact that this corrective action was never meant to be fair.”
AWS Allegations Not Out of Line
Shelly Kramer, a founding partner and principal analyst at Futurum Research, said AWS “is probably not far off” with its allegation of unfairness.
Futurum Research’s Shelly Kramer
“I understand AWS’ frustration and commend the company for relentlessly pursuing what it believes is a fair and just resolution to this matter,” she wrote in a blog. “I do, however, believe (and have always opined) that Microsoft is as capable as AWS when it comes to fulfilling the needs of the Department of Defense for its JEDI cloud computing needs. While that might not have always been the case, Microsoft has earned its place to stand alongside AWS in the cloud arena. I have also always felt that politics has played a role in this decision, based on what is widely known and demonstrated animosity of the president toward Amazon CEO Jeff Bezos. That aside, I’m also a realist. Politics always plays a role, in every selection process and every contract award. Period.”
With that in mind, Kramer predicts AWS will keep throwing legal roadblocks at Microsoft’s ability to start working on JEDI. Again, a court-ordered injunction remains active, so Microsoft cannot proceed.
“I think chances are good that what we’ll see here is continued delay by AWS up to the November presidential election, at which time the company will decide whether to continue to invest in this fight or to move along,” she said.
AWS Not Backing Down
For its part, AWS doesn’t appear ready to give up. In its blog, the company excoriates Trump and the Pentagon.
“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, adding, “Throughout our protest, we’ve been clear that we won’t allow blatant political interference, or inferior technology, to become an acceptable standard. Although these are not easy decisions to make, and we do not take them lightly, we will not back down in the face of targeted political cronyism or illusory corrective actions, and we will continue pursuing a fair, objective and impartial review.”
Microsoft, meanwhile, told Nextgov that it appreciates the Defense Department’s “careful review.”
“[T]he DoD confirmed that we offered the right technology and the best value,” a spokesperson told the publication. “We’re ready to get to work and make sure that those who serve our country have access to this much-needed technology.”
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