The US Department of Defense (DoD) has scrapped the $10bn JEDI cloud-computing contract that was controversially awarded to Microsoft in the Donald Trump era.
The DoD now plans to launch a new replacement contract that will once again pit Microsoft against its rival Amazon Web Services (AWS).
The DoD said it cancelled the contract because “evolving requirements, increased cloud conversancy, and industry advances” meant the original Joint Enterprise Defense Infrastructure (JEDI) contract no longer met its needs.
Its decision has been widely interpreted as a major win for Amazon. The company had complained it lost the original contract because of former president Trump’s hostility towards Amazon’s then CEO Jeff Bezos.
Amazon filed a lawsuit challenging the Pentagon’s decision in 2019, which put the contract in hold.
Media reports alleged Trump may have tried to influence the contract because of his dislike of Bezos, who owned the Washington Post – a newspaper which had repeatedly criticised Trump.
However since then the DoD re-evaluated the contract several times – most recently in September 2020 – and decided Microsoft offered the best bid.
In April 2020 SM reported the Pentagon’s inspector general had ruled the contract was in line with the law.
His report said media reports of Trump’s statements about Amazon “may have created the appearance or perception that the contract award process was not fair or unbiased”.
The DoD said: “JEDI was developed at a time when the department’s needs were different and both the CSPs' [cloud service providers] technology and our cloud conversancy was less mature.”
The Joint Warfighter Cloud Capability contract will replace the JEDI contract and initially only AWS and Microsoft will be invited to bid.
This was because “available market research indicates that these two vendors are the only CSPs capable of meeting the department’s requirements”, said the DoD.
However the department plans to continue market research to determine whether other companies including Oracle, Google and IBM could potentially meet requirements and be invited to bid.
John Sherman, acting chief information officer for the DoD, has said he believes both Microsoft and Amazon will win cloud contracts.
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