US cancels billionaire contract with Microsoft after clashes with Amazon | Business

The US Department of Defense (DoD) terminated a $10 billion contract with Microsoft for cloud computing solutions. The company won the JEDI cloud project auction in 2019, but Amazon sued the Trump administration and blocked the agreement.


Pentagon, headquarters of the US Department of Defense (Image: Thomas Hawk/ Flickr)

Agreement with Microsoft “does not fulfill demands”, says Defense

This Tuesday morning (6), the US Department of Defense (DoD) announced the cancellation of the JEDI project, signed with Microsoft, because it “no longer meets the demands”.

In notice to the The Verge, the department’s head of cloud infrastructure, John Sherman, said advances in the cloud industry had made the project outdated. “JEDI was developed when the demands of the department were different. Both the cloud service providers’ technology and our cloud dialogue were less articulated,” added Sherman.

Along with the termination, the DoD announced a bid for a new Pentagon contract called Joint Warfighter Cloud Capability; a replacement agreement that provides for the same services as the JEDI.

Amazon locked up in court due to Trump’s bias

the TV network CNBC says the military believes there are only two companies in the US capable of meeting the Defense Department’s cloud demand: Microsoft and Amazon. However, a survey to see if other companies can enter the new bid will be conducted.

Under the terms of the JEDI, Microsoft would provide the DoD with cloud storage, task-capable Artificial Intelligence, and other computing solutions.

Amazon lost the contract dispute to the owner of Windows in 2019, but sued the Trump administration — the former president had a negative view of the retailer. With the request to suspend the agreement, the JEDI was stuck in American courts of justice, until a judge decided to continue the project.

In a statement to Congress in January, the Department of Defense said the JEDI was in serious danger due to an “unfinished application for cloud computing.” The project became a time bomb in the lap of the DoD, which was forced to cancel the agreement with Microsoft in order not to leave empty-handed.

Amazon and Microsoft take a stand on JEDI termination

In note to the The Verge, an Amazon spokesman said the company “understands and agrees” with Tuesday’s decision (6):

“Unfortunately, the contract awarded by the DoD was not based on the merits of the proposals and, in fact, was the result of external influences that have no place in government tenders. Our commitment to supporting our nation’s military, and ensuring that combatants and defense partners have access to the best cloud technology at the best price, is stronger than ever. We look forward to continuing efforts to modernize the DoD, building solutions that help accomplish sensitive missions.”

In a post on its official blog, Microsoft said the Department of Defense faced a difficult decision:

“The DoD faced a dilemma: continue with a litigation dispute that could take years, or move on […] Since the security of the United States depends on critical technology upgrades, and outweighs the importance of any contract, we respect the Department’s decision and will take a different path to secure mission-critical technologies.”

With information: The Verge

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