Amazon Shows its Muscle, Pentagon Cancels $10 Billion Microsoft JEDI Cloud Contract
Posted on 07/06/2021
The Pentagon said it is canceling a cloud-computing contract (JEDI Cloud contract) with Microsoft Corporation that could eventually have been worth US$ 10 billion over 10 years. The Pentagon will instead pursue a deal with both Microsoft and Amazon. The Pentagon faced extended legal challenges by Amazon.com Inc to the original October 2019 contract awarded to Microsoft. Amazon complained that the Microsoft award was tainted by politics, specifically then-President Donald Trump’s dislike of Amazon CEO Jeff Bezos. Bezos is the owner of The Washington Post, a D.C. newspaper that was a constant critic of Trump and his policies. In February 2020, Amazon won an injunction, halting work on JEDI.
Microsoft Corporation said in response to the Pentagon announcement, “We understand the DoD s rationale, and we support them and every military member who needs the mission-critical 21st century technology JEDI would have provided.”
“The DoD faced a difficult choice: Continue with what could be a years-long litigation battle or find another path forward.”
“The Department has determined that, due to evolving requirements, increased cloud conversancy, and industry advances, the JEDI Cloud contract no longer meets its needs,” a Pentagon spokesperson said in a statement.
In late 2020, Microsoft Azure held 20 percent of the cloud data market, trailing Amazon’s AWS’ 31 percent.