Microsoft bags $10bn Pentagon contract for JEDI ‘war cloud’ project, edging out presumed frontrunner Amazon

After months of wrangling over the bidding process, tech giant Microsoft has landed the job to develop the Pentagon’s multi-billion dollar “war cloud” storage system, a contract many assumed would go to Amazon.

Dubbed JEDI for short, the Joint Enterprise Defense Infrastructure project has been in the works since November 2017, and sets out to revamp the Pentagon’s computer storage system, upgrading to a remote “cloud” setup. It’s not hard to see why tech firms have jumped at the opportunity to land the decade-long contract, however, worth a hefty $10 billion.

“This contract will address critical and urgent unmet warfighter requirements for modern cloud infrastructure,” the Pentagon said in a statement announcing the decision on Friday.

After a contentious bidding contest teeming with complaints and accusations from some of the firms involved – who expressed concern Amazon would receive favorable treatment – President Donald Trump mulled intervening, with Defense Secretary Mark Esper delaying the project in August for a review of the bidding process.

At that point, Microsoft and Amazon Web Services (AWS) were the last two firms standing in the competition – beating out Google, IBM and Oracle – with many industry observers seeing Amazon as the frontrunner and the best equipped to take on the project. That perception proved incorrect, however.

In a statement issued on Friday, a spokesperson for AWS said the company was “surprised” by the decision.

“AWS is the clear leader in cloud computing, and a detailed assessment purely on the comparative offerings clearly lead to a different conclusion,” the spokesperson said. “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.”

President Trump has feuded with Amazon CEO Jeff Bezos repeatedly while in office, mostly centered on the businessman’s ownership of the Washington Post, which the president has time and again slammed for “fake news.” While it’s not clear if the rancor between the two billionaires affected the JEDI contract, a number of experts suggested it might skew the outcome.

Before dropping out of the contest earlier this year, both IBM and Oracle issued formal protests over the contract, while Oracle filed a lawsuit alleging conflicts of interest between Amazon and the government. The complaints were ultimately dismissed.

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