President Trump said his administration would look into complaints around JEDI's procurement © Tasos Katopodis/Getty Images
President Trump said his administration would look into complaints around JEDI's procurement © Tasos Katopodis/Getty Images

Pentagon awards controversial $10bn JEDI cloud contract

The US Department of Defense (DoD) has awarded a cloud-computing contract to a single winner, Microsoft, following an intervention by president Donald Trump in the controversial procurement process. 

The Joint Enterprise Defense Infrastructure (JEDI) contract, which is reportedly worth $10bn, will see Microsoft collect and store sensitive military data and provide the armed forces with access to technologies such as artificial intelligence.

The acquisition process had been conducted “in accordance with applicable laws and regulations” and all bidders were “treated fairly and evaluated consistently” against evaluation criteria, the DoD said. 

In July 2018, the DoD announced it was looking to “contract to a single source to acquire a modern commercial enterprise cloud services solution”, despite concerns from technology firms who believed a single supplier method could be flawed.

Earlier this year, the procurement process was met with criticism over concerns the frontrunner to win the contract, Amazon Web Services (AWS), was too closely tied to the government.  

In April 2019, Oracle and IBM were excluded from the competition for failing to meet the contract’s criteria.

Three months later, Oracle challenged the contract in court. According to Bloomberg, the lawsuit alleged the decision to pick just one winner violated federal procurement laws designed to ensure competition. The government had cited security as the reason for awarding the contract to a single supplier. 

Oracle also claimed the procurement had been marred by conflicts of interest, as two DoD officials had been offered jobs at Amazon while working on the JEDI project. 

Federal Claims Court senior judge Eric Bruggink dismissed Oracle’s argument, adding that because it didn’t meet the criteria for the bid, it “cannot demonstrate prejudice as a result of other possible errors in the procurement process”. Oracle has begun the process to appeal the ruling.

In July 2019, Trump told reporters his administration would “take a very strong look” at the procurement process of the contract, following “tremendous complaints” made by Amazon’s rivals. The following month saw the announcement of the contract postponed while defense secretary Mark Esper reviewed accusations of unfairness. 

An AWS spokesperson said the firm was “surprised” at the decision to award the contract to Microsoft as AWS is “the clear leader in cloud computing”.

They added: “We remain deeply committed to continuing to innovate for the new digital battlefield where security, efficiency, resiliency, and scalability of resources can be the difference between success and failure.” 

Toni Townes-Whitley, president, US Regulated Industries at Microsoft, said: “We brought our best efforts to the rigorous JEDI evaluation process and appreciate that DoD has chosen Microsoft. We are proud that we are an integral partner in DoD’s overall mission cloud strategy. 

“As was articulated throughout the JEDI procurement, the DoD has a singular objective – to deploy the most innovative and secure commercially available technology to satisfy the urgent and critical needs of today’s warfighters.”

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