Illustration by Alex Castro / The Verge
Following an investigation by the Pentagon, the Department of Defense says it is standing by its decision to award a $10 billion cloud computing contract to Microsoft, not Amazon, the latest in an ongoing legal battle over the lucrative infrastructure project.
On Friday, the Department of Defense said in a statement that it had completed its investigation into the awarding of the Joint Enterprise Defense Infrastructure (JEDI) contract, an investigation it pursued to determine whether there were discrepancies in the procurement process.
The Defense Department said it had “determined that Microsoft’s proposal continues to represent the best value to the Government,” adding that “contract performance will not begin immediately.” That’s because, in February, a judge issued a temporary injunction against the contract after Amazon sued, claiming it was shut out of the contract due to President Trump’s perceived animosity toward CEO Jeff Bezos. Amazon argued that the process of granting the contract had “clear deficiencies, errors and unmistakable bias.”
The contract will provide the Pentagon with cloud services that include basic storage and power, artificial intelligence processing, machine learning, and the ability to process mission-critical workloads.
The government awarded the contract to Microsoft in October 2019, but President Trump said last July that he was looking into the contract following complaints about the bidding process, which prompted concerns about political influence in the decision. IBM and Oracle also bid on the contract but were eliminated from the process in April 2018. Oracle had challenged the decision in court and lost its latest legal appeal earlier this week.
In an email to The Verge on Friday, a Microsoft spokesperson said the company was ready to get to work on the project. “We appreciate that after careful review, the DoD confirmed that we offered the right technology and the best value,” the spokesperson said.
A Friday post on Amazon Web Services’ public sector blog said the company strongly disagreed with the decision, calling the Defense Department’s reevaluation of the contract “nothing more than an attempt to validate a flawed, biased, and politically corrupted decision.” Amazon will continue to pursue a “fair, objective and impartial review” of the process, the post states, adding, “The question we continue to ask ourselves is whether the President of the United States should be allowed to use the budget of the Department of Defense to pursue his own personal and political ends?”
Update September 4th 5:12PM ET: Added statement from Amazon