Rather than carrying through with a $10 billion cloud computing contract that became the subject of a legal battle between Microsoft
The now-canceled contract, the Joint Enterprise Defense Infrastructure (JEDI) deal, has been causing the DoD trouble for some time, and this move won't completely end that fight.
"Due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI Cloud contract no longer meets its needs," the Pentagon said in a press release on Tuesday, July 6.
Both Amazon and Microsoft are likely to win a part of the Joint Warfighter Cloud Capability deal, the new multi-vendor contract. The DoD has stated that Amazon and Microsoft are currently the only cloud computing service providers that can meet the agency's needs, but that it will continue to monitor the market for potential vendors.
The purpose of the up to ten-year-long JEDI contract was to bring the Pentagon's IT operations up to date. In 2019, Microsoft won the contract, a decision that was soon contested by Amazon in federal court.
Amazon argued in a lawsuit filed with the U.S. Court of Federal Claims that then-President Donald Trump was biased against the company's CEO, Jeff Bezos, who has since stepped down. That bias allegedly led the former President to influence the Pentagon's decision in favor of Microsoft.
In a book published on his time in the White House, then-Defense Secretary James Mattis reported that Trump told him to "screw Amazon" regarding the JEDI contract.
However, the DoD's inspector general reported that the JEDI contract had not been influenced by anyone in contact with the White House at the time; although, the report also stated that it was impossible to complete its assessment of Amazon's allegations because the White House offered limited cooperation to the investigation.
Despite missing out on the entirety of the cloud computing project, Microsoft was in full support of the DoD's decision to split up the contract.
"We understand the DoD's rationale, and we support them and every military member who needs the mission-critical 21st century technology JEDI would have provided," Microsoft wrote in a blog post. "The DoD faced a difficult choice: Continue with what could be a years-long litigation battle or find another path forward."
"The security of the United States is more important than any single contract," it added.
However, the company also criticized the fact that the legal battle over this contract effectively delayed the "critical technology upgrades for those who defend our nation" for years, citing the multiple positive contract reviews.
Amazon, of course, argues the exact opposite: that Microsoft did not, in fact, offer the best proposal to meet the agency's needs.
"We understand and agree with the DoD's decision. Unfortunately, the contract award was not based on the merits of the proposals and instead was the result of outside influence that has no place in government procurement," an Amazon spokesperson said in a statement.
For its part, the DoD claims that the battle between Amazon and Microsoft in the courts has very little to do with the decision to cancel the JEDI deal. Instead, the agency argued that its needs had changed since when the contract was created, necessitating a new one.
The new multi-vendor deal is expected to last for a maximum of five years, with the cost running up into the multi-billions.
