WASHINGTON: On Tuesday (July 6), the US Defense Department announced the cancellation of its US$10 billion JEDI cloud-computing project, reversing a Trump-era award to Microsoft and unveiling a new multi-vendor deal that is expected to include big tech rival Amazon.com. After Amazon filed a lawsuit challenging the Pentagon’s decision under then-President Donald Trump, the contract was put on hold in late 2019. Then-Amazon CEO Jeff Bezos was publicly chastised by Trump, who regularly criticized the corporation.
Amazon claimed in 2019 that the Pentagon decision was riddled with “egregious flaws,” which it blamed on “improper pressure from Trump.” According to a book published in 2019, Trump ordered the Defense Department to “screw Amazon” out of the JEDI deal. The Defense Department re-evaluated the contract proposals in September and determined that Microsoft’s submission was the best. The Pentagon warned Tuesday that under the new Biden administration, The only firms that can meet the department’s requirements are Amazon and Microsoft, but they later stated that they will be reaching out to additional cloud providers in the next three months to see whether they can match the government’s standards as well. Oracle, Alphabet’s Google, and IBM are among the major cloud providers.
The Pentagon plans to grant the first awards for its new Joint Warfighter Cloud Capability by April 2022. (JWCC).
Both Microsoft and Amazon are expected to win cloud contracts, according to John Sherman, the Defense Department’s acting top information officer. He stated that the situation was critical. “I have to have this immediately – as soon as possible,” Sherman remarked, “preferably as soon as April.” After the news, Microsoft’s stock fell 0.5 percent, while Amazon’s stock rose more than 4% and reached a new high.
Microsoft stated in a statement that it expects to “continue to be successful as the Department of Defense selects partners for new projects.” According to Sherman, Microsoft might submit a termination bid to recoup the costs of the cancelled project. Amazon did not respond right away. The now-cancelled Joint Enterprise Defense Infrastructure Cloud (JEDI) contract was part of a larger digital modernization of the Pentagon aimed at making it more technologically agile, with a budget of up to $10 billion. “We don’t have an estimate yet,” Sherman added, “but I wouldn’t put my money on the US$10 billion amount.” “This proposal calls for a multi-cloud procurement to be conducted through a full and open competition as soon as early 2025. In the short term, however, we are sure that a direct award path is both necessary and acceptable in order to provide the force with much-needed enterprise cloud capabilities “Sherman remarked./n
