Microsoft wins $10 billion cloud computing contract from the Pentagon

Microsoft beat Amazon Web Services in securing the contract.

Microsoft Corp has beaten Inc in winning a $10 billion cloud computing contract from the Pentagon, said the Defense Department in a statement.

The contracting process, mired in allegations of conflict of interest even drew the attention of President Donald Trump, who has publicly taken swipes at Inc’s founder Jeff Bezos. In August 2019, Trump had said his administration was reviewing Amazon’s bid after complaints from other companies.

This cloud computing contrasct is part of a broader digital modernization effort by the Pentagon and is part of the Joint Enterprise Defense Infrastructure Cloud (JEDI) contract aimed at making the military more agile and provide it better access to data from battlefields and other remote locations.

In a statement, an Amazon Web Services (AWS) spokesman said the company was “surprised about this conclusion.” It goes to read, a “detailed assessment purely on the comparative offerings” would “clearly lead to a different conclusion”.

AWS is considering options for protesting the award, said a source familiar with the matter at hand.

“If I am a warfighter, I want as much data as you could possibly give me,” said Lieutenant General Jack Shanahan, director of the Joint Artificial Intelligence Center, in August 2019 while describing the importance of the contract.

A few companies are concerned that awarding the contract to a single contractor provides an unfair advantage in follow-on work. The Pentagon has responded saying it planned to award future cloud deals to multiple contractors.

Earler this week, U.S. Defense Secretary Mark Esper had removed himself from reviewing the deal due to his son’s employment with one of the original contract applicants – IBM Corp.

Microsoft said it was working on a comment.

IBM and Oracle did not immediately return requests for comment.

“As we continue to execute the DOD Cloud Strategy, additional contracts are planned for both cloud services and complementary migration and integration solutions necessary to achieve effective cloud adoption,” said the Pentagon in a statement.

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