Amazon to fight giant cloud deal won by rival Microsoft - TechCentral

Amazon to fight giant cloud deal won by rival Microsoft

Amazon.com has given notice that it will file a lawsuit challenging the US defence department’s decision to award Microsoft a cloud computing contract valued at as much as US$10-billion over a decade.

The e-commerce giant plans to lodge its complaint against the contract in the US court of federal claims, Seattle-based Amazon confirmed. The company’s challenge was earlier reported by the Federal Times. A representative for the defence department said the agency wouldn’t speculate on potential litigation.

Oracle is also mounting a legal challenge to the cloud contract, known as the Joint Enterprise Defence Infrastructure, or Jedi. The project is designed to consolidate the defence department’s cloud computing infrastructure and modernise its technology systems.

Amazon spokesman Drew Herdener said in a statement that the procurement was tainted by bias and evaluation deficiencies.

“It’s critical for our country that the government and its elected leaders administer procurement objectively and in a manner that is free from political influence,” he said. “Numerous aspects of the Jedi evaluation process contained clear deficiencies, errors and unmistakable bias — and it’s important that these matters be examined and rectified.”

The defence department is grappling with duelling allegations that political interference may have helped or hurt Amazon’s chances of winning the contract. Some lawmakers questioned whether US President Donald Trump unfairly intervened in the process against Amazon. Trump has long been at odds with Amazon CEO Jeff Bezos, who also owns the Washington Post.

Openly questioned

Trump surprised the industry earlier this year when he openly questioned whether the contract was being competitively bid, citing complaints from Microsoft, Oracle and IBM.

A new book by Guy Snodgrass, a speechwriter to former defence secretary Jim Mattis, alleges that Trump, in the summer of 2018, told Mattis to “screw Amazon” and lock it out of the bid. Mattis didn’t do what Trump asked, Snodgrass wrote. Mattis has criticised the book.

Dana Deasy, the Pentagon’s CIO, said during his confirmation hearing in late October that to the best of his knowledge, no one from the White House reached out to any members of the Jedi cloud contract selection team.

Donald Trump … no fan of Jeff Bezos. Image: Alicia Brand

Meanwhile, Oracle has alleged in court that former Pentagon employees with ties to Amazon may have structured the deal to favour Amazon. Oracle is appealing a July ruling from the US court of federal claims that dismissed its legal challenge to the cloud contract. Amazon offered at least two former Pentagon officials jobs while they were working on the procurement, according to the lawsuit.

The defence department in late October awarded the contract to Microsoft, an upset victory for a company initially viewed as a distant second to Amazon in the market for cloud computing services.

Amazon was also seen as the favourite for the Pentagon deal because it won a lucrative cloud contract from the Central Intelligence Agency and had obtained higher levels of federal security authorisations than its competitors.

Oracle and IBM waged a fierce lobbying and legal campaign over the decision to choose just one provider for Jedi, arguing it would imperil the Pentagon’s data and stifle innovation. Both companies were later eliminated from the competition.  — Reported by Naomi Nix, with assistance from Matt Day, (c) 2019 Bloomberg LP

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