PDA

View Full Version : DoD Awards Massive 'JEDI' Deal To Microsoft Over "Surprised" Amazon




Swordsmyth
10-25-2019, 07:49 PM
Jeff Bezos will remember this day for a while...
https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/inline-images/BEZO-BROTHER_4.jpg
Not only did Microsoft's Bill Gates overtake him as the richest man in the world (https://www.zerohedge.com/personal-finance/after-amazon-bust-bezos-dethroned-worlds-richest-man), but against the odds-on favorites, Amazon, Microsoft was just awarded a hotly contested contract to provide cloud computing services to the Pentagon, the Defense Department said in a statement on Friday night.

“Today the Department of Defense has taken another step forward in the implementation of our Cloud Strategy with the award of an enterprise general-purpose cloud contract to Microsoft,” the Pentagon said in a statement.
“This continues our strategy of a multi-vendor, multi-cloud environment as the department’s needs are diverse and cannot be met by any single supplier. This contract will address critical and urgent unmet warfighter requirements for modern cloud infrastructure at all three classification levels delivered out to the tactical ed


The Defense Department said the base contract period is two years with a $1 million guarantee.


The contract - known as the Joint Enterprise Defense Infrastructure (or JEDI) and worth up to $10 billion - was the subject of a major lawsuit by Oracle which accused the Pentagon of favoring rival Amazon Web Services in the procurement process (https://www.zerohedge.com/news/2019-08-29/inside-amazon-and-silicon-valleys-jedi-mind-trick-pentagon).
https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/inline-images/jedi-560.jpg
In July, the WSJ publicized new evidence (https://www.zerohedge.com/news/2019-07-08/wsj-exposes-conflicts-interest-involving-amazon-pentagon-over-10b-jedi-contract) showing that senior Amazon executives met with senior DoD officials, including then-Defense Secretary James Mattis, to discuss the project before the bidding even began, while the decision over the program was expected this month.
Oracle eventually lost out on the project after losing a critical court case (https://www.zerohedge.com/news/2019-07-12/oracle-loses-critical-lawsuit-alleging-pentagon-amazon-colluded-over-10b-war-cloud) against the Pentagon and Amazon, allowing the DoD to move forward with either Amazon or Microsoft.
And while Amazon shares are down modestly on the news (for now), a loss of government confidence in AWS (which generated $2.2 billion of net income in the first quarter, up 57% year-over-year and representing two thirds of the consolidated total) could be significant.
https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/inline-images/2019-10-25_16-45-49.jpg
As a D.C.-based observer told ADG in April:

“The AWS story, as sold to enterprise customers and the Street, is built upon the [C.I.A] reference case and the cash that has come in from that deal.”
It remains to be seen how Microsoft’s employees will react to this news. Last year, a number of Microsoft employees posted an open letter asking the company not to bid (https://medium.com/s/story/an-open-letter-to-microsoft-dont-bid-on-the-us-military-s-project-jedi-7279338b7132) for the contract.

More at: https://www.zerohedge.com/technology/dod-awards-massive-jedi-deal-microsoft-over-surprised-amazon