Microsoft's Pentagon cloud computing win comes at a cost, legal and internal

"It's a landmark win that will change the cloud computing battle over the next decade". The Redmond giant told The Register in a statement that it was more than ready to begin.

"For over 40 years, Microsoft has delivered innovative, proven and secure technologies to the US Department of Defense (DoD)". The Pentagon has awarded Microsoft a $10 billion cloud computing contract called JEDI, Friday, Oct. 25, 2019.

AWS also spent much of the previous year litigating the requirements in the Pentagon's JEDI solicitation as a defendant alongside the Defense Department against allegations of improper conflicts among DOD officials that weighted the procurement in the favor of AWS. The Amazon-owned cloud outfit was understandably upset and a bit shocked that it wasn't on the winning end. Amazon could also go to the US Court of Federal Claims, which could allow it to strengthen its case through discovery.

He added that the company was "the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion". "We remain deeply committed to continuing to innovate for the new digital battlefield where security, efficiency, resiliency and scalability of resources can be the difference between success and failure".

As AWS alluded in its statement, the JEDI bidding and award process was dogged from the start by outside politics and accusations.

The Pentagon's inspector general said in a separate statement on Friday night that it had "not found evidence that we believe would prevent the DoD from making a decision about the award of the contract".


The announcement reportedly came as a surprise to some, as Amazon Web Services had been labeled the favourite to receive the contract.

"Amazon and Microsoft...know what the criteria are against which they were being evaluated", said Professional Services Council President and CEO David Berteau on an October 28 call with reporters.

It was definitely considered early on because of AWS' previous contract with the Central Intelligence Agency back in 2013, and Amazon being certified at the highest existing security clearance level, while Microsoft has been playing catch up.

In the past year, Azure has racked up some large deals from Kroger Co.to AT&T Inc., but a customer as big, demanding and secretive as the Pentagon will go a long way toward cementing Azure's reputation as a serious contender.

Then there were the also-rans, like IBM and Oracle, who were out of the running for the contract long-ago, but maintained an interest in the deal.

On the other hand, Berteau noted, if the debrief doesn't provide clear answers to whether a company lost on price, technical factors, experience, past performance or other factors, "the best way to get more information on why you lost is to protest". It's a huge coup for the company, although it is likely to cause some tensions among Microsoft staff.

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