In context: If you keep up with the tech news, chances are you’ve heard of the Defense Department’s high-profile “JEDI” contract, worth around $ 10 billion. The contract was initially awarded to Microsoft in 2019, but through a series of challenges, Amazon managed to block its competitor from receiving the coveted defense agreement.
Had the contract been honored, Microsoft would have assisted the Department of Defense in developing cloud computing technology. More specifically, the advocacy organization wanted to replace its existing IT infrastructure with a unified cloud-based alternative. Although the Defense Department claimed that its selection process for contract recipients was completely fair and based solely on the merits of each applicant company, Amazon was convinced that something else was afoot: interference from former President Donald Trump.
Unfortunately for Microsoft, Amazon has managed to stall the contract long enough to render its competitor’s victory in 2019 useless. As of yesterday, the Department of Defense has officially canceled the contract, he withdrew it from Microsoft and will no longer seek a private company to fulfill its terms.
Interestingly, the Department of Defense does not mention Amazon’s challenges at all in its official cancellation announcement. Instead, the advocacy group cites “evolving requirements, increased cloud conversion, and industry advancements” as the top reasons for the termination of JEDI. Whether that’s really the case or just an attempt to save face, we can’t say.
In any event, both Amazon and Microsoft have offered statements about the Defense Department’s decision. Microsoft is quite extensive and comes in the form of a long-running blog post, which can read here. However, the following excerpt sums up the company’s opinion very well:
We understand the foundation of the Department of Defense and support them and all members of the military who need the 21st century mission critical technology that JEDI would have provided. The Defense Department faced a difficult decision: continue with what could be a litigation battle of years or find another way forward. America’s security is more important than any individual contract, and we know Microsoft will do well when the nation does well.
Amazon, on the other hand, had the following to say:
We understand and agree with the DOD’s decision. Unfortunately, the award of the contract was not based on the merits of the proposals, but was the result of external influence that has no place in public procurement. Our commitment to supporting our nation’s armed forces and ensuring that our fighters and defense partners have access to the best technology at the best price is stronger than ever. We look forward to continuing to support the Department of Defense’s modernization efforts and creating solutions that help fulfill its critical missions.
All is not lost for the tech giants in dispute. In lieu of the JEDI contract, the Department of Defense plans to consider proposals for a new “Joint Combat Capability in the Cloud” contract (not sure how much it will be worth). The Defense Department is only considering Amazon and Microsoft for now, but will conduct market research to see if any other company could handle the workload.