Amazon stalls Microsoft’s $10B ‘war cloud’ contract with the US gov

Amazon says Trump interfered with the JEDI bidding process


A US federal judge sided with Amazon on Thursday to temporarily block a $10 billion government contract awarded to its rival Microsoft, Financial Times reports.

The ecommerce giant requested the Court of Federal Claims to impose an injunction on the Joint Enterprise Defense Infrastructure (JEDI) contract, which would see Microsoft build an enormous cloud environment for the Department of Defence.

Amazon argued that beef between its CEO Jeff Bezos and president Donald Trump swayed Pentagon officials into awarding the JEDI contract to Microsoft last October.

In fact, Amazon‘s lawyers want Trump and other defense officials deposed, having submitted evidence to the court that references recently-published claims that the president told then-defense secretary John Mattis he wanted to “screw Amazon” out of the lucrative contract.

The judge’s decision blocks all related work until Amazon‘s lawsuit is litigated.

Amazon, Microsoft, Oracle fight over $10B mission-critical deal

The JEDI project is no joke. It’s essentially the US government’s “war cloud,” to be responsible for processing and storing intense amounts of classified data, and will even feature an artificial intelligence component to help with war planning.

Pentagon officials have reportedly described it as critical to pushing the US military’s technological advantage forward.
Trump & Bezos photo courtesy of RTLNieuws.

The contract was first announced around 18 months ago, with the likes of Microsoft, IBM, Google, Oracle, and Amazon competing with bids.

By April last year, the Pentagon maintained that Amazon and Microsoft were the only candidates to meet JEDI‘s technical requirements, and many considered the former to be the favorite as it had previously built cloud systems for the Central Intelligence Agency.

Trump eventually weighed in, supposedly after fielding claims from the other companies that the bidding process was unfair. Around the same time, Oracle made an unsuccessful legal challenge that alleged Amazon hired Defense Department employees to work on its internal bidding process, skewing the process in its favor.

Months ago, Pentagon officials warned such back-and-forths were wasting time, ironically putting the United States at a military disadvantage, but with Amazon awarded its injunction, it’s likely this soap opera will drag out for a while yet.

As for Microsoft, it expressed disappointment with what it calls an “additional delay,” and that it believes it will ultimately be able to start work on the JEDI project.

“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,” said the company in a statement (via FT).