Amazon demands cancellation of $10bn JEDI cloud contract awarded to Microsoft

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Amazon Web Services (AWS) has called yet again for the $10 billion JEDI cloud contract awarded to Microsoft by the US Department of Defence (DoD) to be rescinded, after a ruling in September found in favor of its competitor.

As shown by court filings from October 23, unsealed this week, AWS has mounted a further challenge on the grounds that the award is the “product of systematic bias, bad faith and undue influence exerted by President Trump.”

According to Amazon, both the original decision and subsequent re-evaluations are blighted by failures to recognize flaws in the procurement process and the superior value for money delivered by its proposal.

“After the Court rejected the flawed initial JEDI evaluation, the DoD spent over four months attempting to revive Microsoft’s non-compliant bid and reaffirm that flawed and politically-biased decision,” said an AWS spokesperson.

“As a result of the DoD fixing just one of many errors, the pricing differential swung substantially, with AWS now the lowest-priced bid by tens of millions of dollars. The fact that correcting just one error can move the needle that substantially demonstrates why it’s important that the DoD fix all of the evaluation errors that remain unaddressed, and ensure they are getting access to the best technology at the best price.”

JEDI cloud contract

The highly lucrative Joint Enterprise Defence Infrastructure (JEDI) contract is designed to deliver a significant upgrade to the Pentagon’s IT operations and cloud computing capabilities.

The bid was hotly contested by Microsoft, AWS, Google Cloud and others, with the contract ultimately awarded to the Redmond giant in late October 2019 - a decision that infuriated Amazon and sparked the first of many subsequent appeals.

The company disputed the result, citing “deficiencies, errors and unmistakable bias”. AWS believes the DoD improperly evaluated a Microsoft price scenario and that involvement of US President Donald Trump, who has frequently been at loggerheads with Amazon CEO Jeff Bezos, amounted to foul play.

In February, Amazon succeeded in having the project frozen until an investigation into the procurement process had been performed, although the probe later conducted by the DoD watchdog uncovered no evidence of malpractice.

The company lodged a further complaint in May, this time directly with the DoD. This complaint eventually resulted in the most recent court ruling, which upheld the view that Microsoft’s proposal delivers the best return on investment for The Pentagon.

Microsoft, for its part, has repeatedly reiterated its desire to begin work on the project and accused AWS of attempting to “bog down JEDI in complaints, litigation and other delays designed to force a do-over”. But Amazon is showing no signs of letting up.

“We had made clear that unless the DoD addressed all of the defects in its initial decision, we would continue to pursue a fair and objective review, and that’s exactly where we find ourselves today,” said AWS.

Frank X. Shaw, CVP Microsoft Communication, has since provided the following statement:

"Amazon seems to be saying the only way they can ever lose is if the procurement isn't fair. But every month, the market tells them that's not true. Large and sophisticated customers regularly choose Microsoft over AWS. They do this because of the strength of our technology, our understanding of complex projects, and our overall value."
"As the losing bidder, Amazon was informed of our pricing and they realized they'd originally bid too high. They then amended aspects of their bid to achieve a lower price. However, when looking at all the criteria together, the career procurement officials at the DoD decided that given the superior technical advantages and overall value, we continued to offer the best solution. We also know what it takes to serve the DoD having worked with them for more than forty years."
"The DOD's independent IG report found there was no evidence of actual procurement interference so it is time we moved on and got this technology in the hands of those who urgently need it: the women and men who protect our nation." 

Via Reuters

Joel Khalili
News and Features Editor

Joel Khalili is the News and Features Editor at TechRadar Pro, covering cybersecurity, data privacy, cloud, AI, blockchain, internet infrastructure, 5G, data storage and computing. He's responsible for curating our news content, as well as commissioning and producing features on the technologies that are transforming the way the world does business.