Pentagon’s $10bn winner-takes-all cloud super-contract in stasis as Starship Bezos opens fire
A US federal court today slammed the brakes on the Pentagon’s decision to award Microsoft the JEDI cloud mega-contract.
Judge Patricia Campbell-Smith granted Amazon a restraining order that effectively pauses the ten-year $10bn winner-takes-all deal so that the web giant can challenge the US military’s decision to hand the agreement to the Windows goliath.
Amazon will have to put up a $42m deposit “for the payment of such costs and damages as may be incurred or suffered in the event that future proceedings prove that this injunction was issued wrongfully,” but that’s nothing to the trillion-dollar behemoth.
Microsoft told The Register it remains confident the JEDI – aka the Joint Enterprise Defense Infrastructure – cloud contract will go forward with Redmond at the helm.
“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,” Microsoft said in a statement from comms VP Frank Shaw.
“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 order was made because Amazon is challenging Uncle Sam’s decision-making process in the closing months of the JEDI bidding period. For most of the years-long tender, Amazon was seen as the clear favorite to win the ten-year single-supplier IT modernization contract, to the point where other tech behemoths had claimed the system was unfairly rigged in the internet kingpin’s favor.
Shortly before the contract was to be awarded, word came that President Trump had taken a personal interest in the deal, and had demanded a probe to examine whether Amazon CEO Jeff Bezos – a personal rival – had a finger on the scales of the bidding process.
A few months later, Microsoft’s Azure was awarded the contract over AWS, much to nearly everyone’s surprise, and Amazon immediately got its lawyers on the case. An appeal was immediately filed as Amazon accused the government of deliberately tanking the AWS bid on Trump’s ordering. Part of that appeal was the request that the JEDI contract be blocked until the court decides the matter.
Most recently, Amazon launched an ambitious bid to depose the President as well as both the current and former Secretaries of Defense.
The decision may be a hot topic next week when the President meets with another party involved in the JEDI saga: Oracle supremo Larry Ellison, who is hosting a fundraiser for Trump’s re-election. Oracle was among those who had originally challenged AWS in its bid for the contract, and had alleged that Amazon was rigging the process in its favor. ®